Thinking in terms of sustainability and circularity has a potential to shatter geopolitics dynamics. Why? Because sustainability can foster self-reliance and can drive a focus on local circular economy loops. In fine, it can reduce the leverage from foreign powers who supply raw materials or energy. Yes, it is costly to create efficient and effective circular loops, but there is no price tag for freedom. And remember, every little helps: it takes many droplets to make an ocean.
An harsh reminder of dependence
Today, as Russia is invading Ukraine on this somber February 2022, we have a blatant reminder how the reliance on Russia for basic needs (gas supply to warm homes during winter) complicates the European Union’s response to the invasion of Ukraine.
The response of the European Union towards the aggression maybe has not been as clear-cut and firm as one could have hoped. It took time for Germany to put a halt to the Nordstream 2 project which was supposed to bring 10% of Europe’s gas consumption with its 55 billion cubic feet capacity. It took a week for leaders to decide to ban selected Russian banks from the SWIFT system and to decide to stop granting Golden passports. Why? Because Europe depends heavily on Russian oil and gas to warm its population, especially during this harsh 2022 winter. Europe relies on Russia for around 40% of its natural gas. European leaders needed to make sure that they could continue to pay for their energy to keep the gas flowing to people’s homes. Will the sanction on the SWIFT system be as effective as people claim today? It will certainly damper Russia’s ability to use its foreign currency reserves. But the existence of FinTech and cryptocurrencies are likely offering alternative payment flows that could soften the blow. Time will tell if these sanctions are effective or backfire.
Granted, the situation is complex and we need to find ways to de-escalate the situation to avoid a full blown WW3 in front of a leader who clearly does not care about signed peace treaties, nor civil casualties. Let’s not digress more.
Sustainability and circularity to fuel self-reliance?
Exploiting the value of waste to reduce imports of raw materials
- Recycling rare metals from e-waste can reduce the reliance on foreign countries for supplying the same rare earth materials. In fact, there is more gold in e-waste than in gold ore! Figures vary. This article How to mine precious metals in your home — BBC Future claims that “the electronics inside a phone can surrender around 1kg of silver and 235g of gold per tonne of devices. This compares very favourably to primary mining, which only averages 100g of silver in each tonne of mined ore, and 2–5g of gold per tonne of ore..”.
- Creating refurbishing and remanufacturing loops can foster local production without the need for supply of raw material that often come from foreign lands (or at least reducing part of the reliance, which is a start).
Reducing the reliance on oil and gas with renewable energy
- Using renewable energy may reduce the reliance on gas and oil supply from foreign nations. Unfortunately, renewables are not yet fit for mass electrification for three big reasons: (1) the timely disconnection between generation and demand (think of solar energy generating during the day when you need it at night), (2) the intermittent characteristic of the electricity generated by wind energy affects the networks and requires costly infrastructure adaptations unless we change the energy supply paradigm to promote self-supply at small scale, (3) the sheer scale of the demand for electricity can hardly be satisfied with sprawling wind farms or solar farms that require much more land use than traditional Oil & gas plants. In other words, solar and wind energy produce low density energy. The deployment of electric batteries may help the first two problems, but it’s still considered as experimental and will not solve problem #3.
- Problem #3 is the main reason why nuclear energy is often touted as an enticing “clean” energy as it is high density and does not produce greenhouse emissions (granted, it’s not really renewable because it depends on a rare fuel — Uranium U235 — that needs to be extracted from a foreign soil and produces toxic waste). We’re still decades away from nuclear fusion which is supposed to create less harmful waste.
Hence, innovation in circular loops and renewable energy solution can be key for geopolitics too, they’re no just good for the planet.
In conclusion, let remind ourselves that the sustainability discussion can also play a role in geopolitics. Because businesses can be creative and find sustainable solutions that will promote self-reliance and local production loops, they can also play their part in the geopolitics game too.