Shocking Discovery: You Won’t Believe What Was Found in the Green Casket Buried in Ukraine!

Greetings from New York where the political chatter is swelling on former US President Donald Trump’s bid to become the Republican candidate for the 2024 race. But as pundits weigh the US far-right, green activists must also keep an eye on the conservative vote in Europe.

Spanish voters went to the polls this weekend in an election that left Alberto Núñez Feijóo, the leader of the right, greatly strengthened. He, like other conservatives in Europe, has been running on a platform that seeks to slow down the green transition. Meanwhile, in London there are growing calls within the UK Conservative Party for a withdrawal of net zero measures, following the recent parliamentary by-election.

It remains unclear whether British Prime Minister Rishi Sunak heeds these calls to water down green policies. One tricky factor is that polls indicate fairly strong bipartisan support for green policies in the country, even amid a cost-of-living crisis. In a survey by the National Statistical Office this month, for example, 62% of UK adults said they feel ‘very’ or ‘somewhat’ concerned about climate change, compared with 92% who are concerned about the cost of living, 88% about the NHS and 79% about the economy.

That leaves concern about climate issues below the 74% level seen last year, but still significantly elevated. And 62% of respondents this year reported making lifestyle changes in response to climate change.

But even if those polls make conservatives wary of being outright anti-green, or reversing existing policies, there’s a growing risk that Sunak’s team could become less aggressive in pushing for new green reforms. This is important given how much needs to be done – and coordinated – to achieve net zero goals. Upgrading the housing stock, for example, is a policy that will require government intervention. So it will be interesting to see what the opposition Labor Party has to say about the Green Agenda when it meets for the party conference this autumn. Let us know what you think it should do.

And in the meantime, take note of the story below about how the Russian invasion of Ukraine sparked a battle over a vast swath of rare earth minerals needed for green technology. And check out the FT report at how extreme heat is reshaping economies. — Gillian Tett

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Ukraine is sitting on a treasure chest to fuel the energy transition

Another week, another wave of depressing news from Ukraine.

While Kyiv launches its counter-offensive, hitting targets such as the Kerch bridge in Russia bombed the port cities of Ukrainewarning that he would treat grain ships as military targets.

My friends working with the Ukrainian forces in places like Zaporizhzhya are now prepared for long ugly battles as Kiev tries to recapture eastern regions like the Donbas. So are the Western allies, judging by the mood the Aspen Security Forum last week, which featured a video address by Volodymyr Zelensky.

This of course has big consequences for geopolitics. But what’s less well known is that these battles matter hugely for green tech as well. Ukraine is sitting on vast hydrocarbon reserves. But it also sits on one of Europe’s largest deposits of critical minerals needed for electric vehicles and other clean energy applications.

The country has about 500,000 tons of lithium, researchers from the National Academy of Sciences of Ukraine said last year. This total distinguishes Portugal as the largest lithium resource in Europe. But for now, Ukrainian lithium is not being mined, the researchers said.

More generally, Foreign Policy magazine said last yearciting Ukrainian government documents and foreign analysts, that the country had “commercially significant deposits of 117 of the 120 most used industrial minerals in more than 8,700 deposits surveyed”. The total value of these deposits, including titanium, iron, neon, nickel and lithium, has been estimated at up to $11.5 trillion. There are also reserves of other minerals deemed critical by the IEA such as beryllium, niobium, tantalum, titanium and cobalt, along with non-critical elements such as uranium and feldspar, just to name a few.

Before the invasion of Moscow, Ukraine was making plans to develop these assets by offering foreign investors tax breaks and investment rights. Unfortunately, those plans didn’t go very far.

“It’s an incredibly important issue of war that people don’t understand,” a senior US official told me recently. And what makes it doubly critical is that Western allies are frantically looking for ways to break their dependence on Chinese supply chains for these minerals.

To return to lithium: China belongs to the world third largest lithium producer and was also on a “acquisition blitz” for lithium projects around the world. China still accounts for about 50 percent of all batteries installed in electric vehicles globally, more than Europe and the United States combined, according to Morgan Stanley.

While automakers and Western entrepreneurs like Elon Musk are looking to develop alternative sources of lithium, it’s unlikely to deliver quick results anytime soon, not least because getting permits for the messy work of lithium mining and processing is difficult in the US and Europe. Hence the tantalizing prospect of trying to develop critical minerals in a place like Ukraine, which will be desperate for new sources of growth if (or when) the war ends.

Sadly, the Russian authorities are also acutely aware of the geopolitical significance of those minerals and many reserves are located on land controlled by Russia; in fact, Western diplomats suspect that the location of this wealth was one of the reasons Putin’s regime annexed four territories in eastern Ukraine last year.

The Wagner mercenary group is particularly wary of the commercial implications of those minerals, I’ve been told. Titanium, in particular, is a key focus. But no one should underestimate the determination of Western leaders to break their dependence on China and the ability of mineral exploration to hold surprises. Just take note, for example, of what has just happened in Norway: a couple of weeks ago the Anglo-Norwegian group Norge Mining announced that it had discovered in Rogaland vast reserves of phosphate rocks, which apparently amount to at least 70 billion tons, almost equal to the previously known global reserves of phosphates.

Because phosphate is a key mineral used in an important form of lithium-ion battery known as an LFP, this discovery is “a big deal,” said Gavin Harper, a geologist at the University of Birmingham. “Until this discovery, only five countries controlled 85% of world reserveswith 70% in Morocco alone”, he observes. “It is China that extracts the largest quantity of phosphate rock, producing 85 million tons in 2021followed by Morocco with 38 million tons”.

Norge does not expect to sell phosphate from this reserve until 2028, due to the messy and time-consuming approval and investment process in Europe. In the US, the approval issue is probably even worse (as we recently noted.) But as entrepreneurs scour western soil for more deposits, Ukraine is likely to look more and more enticing. Which, of course, is yet another reason to hope that the Western alliance will help Kyiv win the war soon. (Gillian Tett and Patrick Temple-West)

Smart reading

Extreme heat is reshaping economic output, and it’s not just tourism that is threatened by heatwaves. Industries ranging from construction, manufacturing, agriculture, transportation and insurance are all gearing up to change the way they do business, our colleagues write in this Big Read, that’s really worth it. There is evidence that extreme heat is “knocking down our growth.”