In my full-time work as an investment writer, I spend most of my time writing about sustainable finance. This year, I have worked on articles about climate change, the oil and gas sector, cobalt mining, palm oil, fast fashion and renewable energy, to name a few. One of my favourite articles that I’ve worked on this year was all about electric vehicles, looking deeper into the data on whether or not they are actually more environmentally friendly than certain diesel and gasoline cars. This article was a response to a Financial Times article asserting that, gasp, diesel cars might be greener than electric vehicles. I worked with our electric vehicles analyst and a brilliant model he’d built to show that, in almost all cases, that is not the case (and we also called out the FT for their creative use of data).
As I learned from this project, most of the carbon costs of electric vehicles occur during the battery manufacturing process, and the energy needed to make an EV battery is determined by two things: size and manufacturing location. Size is pretty self-explanatory – bigger battery, more energy required – but finding out just how big of an impact location had on the total energy costs blew my mind.
The reason why the carbon costs of different manufacturing locations vary so much is because each country gets its energy from a different mix of sources. Some countries are already powered mostly by renewable energy sources, while others still rely heavily on coal. This affects the carbon cost of all manufacturing, as each joule required in a coal-dependent nation is costing the planet far more than the same process in a country full of wind turbines and solar panels. What does this mean for electric vehicle batteries? It means that each unit of power (kilowatt hour, or kWh) manufactured for a battery – with batteries having varying capacities of 35 kWh, 50 kWh, 100 kWh, etc. – will release a mere 13.3 grams of carbon dioxide if made in Sweden, which fuels most of its national grid with renewable energy, and will release 773.3 grams per kilowatt hour if manufactured in Poland, which primarily powers its national grid with coal. This means that a battery produced in Poland will release sixty times as much carbon dioxide as the exact same battery produced in Sweden.
Is it not clear that there are easy climate wins to be had here? Poland should not be making electric vehicle batteries. Every electric car made in Poland puts sixty times as much carbon dioxide into the atmosphere as a car made in Sweden (and of course, each country falls somewhere along that scale too). It’s insanity to think that we continue to produce almost all the same items in every country in the world, with no thought to the carbon consequences, especially when you consider that the country a battery is manufactured in has little to do with where the car ends up being sold (so it’s not as if manufacturing in-country cuts down on the carbon cost of transporting the final product). If we took a broader, more global view of production, rather than leaving each country to do its own thing regardless of the relative carbon consequences, then perhaps we could think more intelligently about where we make things, and why.
This leads back to global governance, an idea I started exploring in a blog post a few weeks ago. Because we grant the highest autonomy to the nation state, we have little power to look at production and distribution at the global level. Of course, the international free market and free trade are not totally free – regulations, agreements and tariffs abound to make sure that the most powerful still benefit most from international trading structures. But there is little governance infrastructure in place to consider the colossal waste of energy involved in these kinds of carbon discrepancies and to do something about it. It makes no sense to make things – let alone ‘green’ products! – in a place where you could make sixty of the same item for the carbon costs of one only a few hundred miles away. Given the urgency of the climate crisis, these are the things about which we need to be thinking.
Of course, this is not an issue limited to electric vehicle batteries. If Poland’s grid is powered mostly by coal, and Sweden’s by wind and solar, then everything manufactured in Poland would be better manufactured in Sweden from a climate perspective. There are people in Poland who needs jobs and money, and it’s not as if the few countries with very green energy grids can support the weight of the world’s manufacturing needs alone. Clearly, the long-term aim must be to ensure that every grid looks like Sweden’s. By doing this we would slash the world’s production of carbon dioxide without changing a thing about the volume produced. But just how feasible is this? I don’t know a lot about the nuances of renewable energy, but I imagine that access to enough ocean for wind farms is key to harnessing wind power and a steady stream of powerful sunlight is required to run your cities directly from the sun’s rays. In addition, renewable energy is exceptionally difficult to store and transport. I know there are some renewable alliances starting to form, with nations stacked with wind turbines trading solar power with interconnectors, but they are in the early stages and require close proximity. So what if going green won’t be possible for some countries any time soon?
It’s a matter of priority. If addressing the climate crisis is the most important thing, then perhaps nations that cannot manufacture items powered by renewable energy should not be manufacturing. There are so many potential answers to climate change and yet we continue to mindlessly burn fossil fuels even if there are much greener ways to get the exact same products. Of course, in any conversation like this, climate justice must be paramount. Part of the backlash to any efforts made to curb our most polluting industries is that of social and labour justice. What happens to the people out of work? What happens if a sustainable planet means that Poland loses much of its income? The answer is that any viable climate change solution will have solutions to these problems embedded. In order for a post-climate crisis world to be one that people can see themselves living in, and happily so, all green industry plans must involve bringing people of all backgrounds and identities forward together. That means that, if Poland couldn’t switch to renewables, and therefore could no longer manufacture, the people of Poland would still have their needs met and have other avenues of work and purpose available to them. The highest priority would be climate-conscious lives and industries, but with support and opportunities available to ensure a just transition. Global governance would help these aims; right now, wealth distribution is poor even within countries, let alone between them. Other than the miniscule amounts of money given as foreign aid, most countries are not expected to cough up cash for citizens of other nations, as of course your citizens take priority, even if you have a hand in ensuring other countries are kept in poverty. A global look at resources would mean that governments would not be scrambling to provide their citizens with income at all costs, even if the cost was that of the planet and the future of our species.
We must be able to do better. It makes no sense to have the same products manufactured in a host of different places, with one factory producing sixty times as much carbon dioxide as another. We have to work smarter. Our survival depends on it.