and other locations. 10 There might be much to learn from oil and gas exploration companies that—despite several warnings of “peak oil”— found innovative solutions to ensure more
supply. When applying advanced analytics to enable increased extraction, it will be critical for suppliers to respect local laws, environments, and communities.
10 Willem Marx, “Forget gas prices. The billionaire club’s run on cobalt says everything about our battery-powered future,” Vanity Fair , April 2022.
Strengthening supply chains
Potential sources of disruption and delay Five factors could contribute to delays in deployment of the technologies needed for a more orderly energy transition: 1. Volume shortages. Suppliers could be unable to deliver sufficient quantities of materials or components because of long lead times required to scale up or fundamental limits. For example, constraints on mining capacity for lithium while demand for lithium-ion batteries increases could result in a supply–demand gap. 2. Price volatility. Market forces could create price volatility for many materials and components. 3. Geographical sourcing dependency. Political, social, regulatory, and other uncertainties could roil trade flows in some regions, disrupting materials or component suppliers. 4. Long lead times. Material or compo nents could take even longer to procure as manufacturers grapple with capacity and logistical constraints. - 5. Unreliable quality. Demand increases could affect quality as suppliers (and their vendors) loosen quality controls to accelerate production.
As the power sector begins a dramatic transformation toward electrification and clean energy, critical supply chain challenges could pose a challenge to the ability of the United States to execute a more orderly energy transition. The new technologies required for this transformation rely heavily on the steady supply of resources that, in many cases, are vulnerable to disruptions. We estimate, for example, that by 2030, the global energy transition would demand a nearly ninefold increase from 2020 levels in lithium supplies, more than eight times the volume of nickel, twice the amount of copper, and three times the level of rare earth minerals. The United States could seek stable access to supply even as many other countries pursue the same base materials, exacerbating the challenges. In addition, the construction of new capacity for clean power generation and storage in the United States could require surging the production of generation equipment, including solar panels (more than triple 2020 levels), wind turbines (more than four times higher), and lithium-ion batteries (more than 20 times
components could slow the pace of deployment of these assets. For example, when the United States began investigating tariff challenges on key solar supplies at the beginning of 2022, project delays increased, and solar developers raced to identify alternative pathways to access supply. Significant portions of the solar manufacturing supply chain remain concentrated in China: 95 percent of solar ingot manufacturing supply is concentrated in China or Taiwan. Development of renewables, meanwhile, could require significant scaling of the labor market. In the Achieved Commitments scenario, more than 550,000 direct and indirect job opportunities could be created in 2030 to support deployment of needed generation resources, including solar, wind, and natural gas. 1 Those jobs would be in addition to those needed to develop other technologies, perform grid build- out and management, and deploy electrified equipment and vehicles. And the number of jobs required to support the transition could continue to increase beyond 2030 as the United States seeks to achieve longer- term commitments.
higher). Insufficient or unsecured manufacturing capacity for key
1 Employment and job opportunities are not equal to full-time-equivalent (FTE) roles but rather an industry-specific mix of full-time, part-time, and seasonal employment roles typically referred to as job years. This metric accounts for seasonality and follows definitions used by the US Bureau of Labor Statistics and Bureau of Economic Analysis.
Accelerating the journey to net zero
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