Material World

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29 February 2024

One option, nearly (but not) suggested by Ed Conway, would be to dig up Cornwall that is, in the name of energy transition.

It seems unfittingly twee to begin in England’s beautiful and rugged southwestern-most tip for what amounts to a sweeping, urgent and thorough examination of civilisation’s dependence on the physical resources making up the ‘material world’.

A material world distinct from the services and technology age we live in, which Conway calls the ethereal world.

This is the tension at the heart of Conway’s story – an ethereal world disconnected from the material world, but entirely dependent upon it.

Disconnected Dependence

Conway uses six physical substances as his medium: sand, salt, iron, copper, oil and lithium. By examining the people and processes behind their extraction, distribution and application, he unearths unexpected and uncomfortable truths about the extent of modern society’s reliance on the physical world.

By now, most of us understand lithium’s indispensable role in the energy story.

Lithium-ion batteries are used in everything from industrial scale energy storage farms and electric vehicles to wireless headphones and vaping devices. But where does lithium come from? Conway takes us to the salt flats in Chile’s Atacama Desert, one of the driest places on earth. A few metres below ground, there are gigantic underground reservoirs of brine.

These lithium ponds have sat undisturbed for millions of years. The extraction process involves pumping up the brine and gradually allowing the sun to evaporate away the water, then separating the lithium from the other residual salts.

It is a complex process with a heavy footprint. Lithium extraction reveals two of the major questions surrounding our interaction with the material world. Are we willing to destroy a pristine ecosystem to extract valuable minerals? And who foots the bill? Battery makers are in a tussle with each other, and with governments, to secure access to lithium. This raises political questions. At the national level, local populations demand compensation for the impact on their land and politicians seek to protect or exploit these resources; and, at the geopolitical level, access to resources determines power on the international stage.

No imaginary matriarch and her inventive offspring here.

You can't eat oil

So read the placards held aloft by protestors outside the London HQs of some major energy companies last year. Their message: we are at a critical point for humanity and, unless we stop using oil, we will slide towards extinction. We must prioritise our survival, or else.

But we do eat oil. Or at least fans of salt and vinegar crisps do. Conway reveals that the vinegar taste in crisps comes from petrochemicals.

Now this isn’t reason enough in itself to keep the drills spinning, but it does illustrate how (unknowingly) reliant we have become on the ‘dirty’ resources in environmental activists’ crosshairs.

Like two atoms in a molecule, inseparably combined

Beyond the obvious environmental challenges posed by our reliance on the material world, Conway’s study demonstrates the hidden complexity of modern supply chains.

Raw substances are surprisingly intertwined, with the production or processing of one entirely dependent on another. Hence Conway’s scepticism that the energy transition can happen with minimal disruption to the planet. He puts some numbers on it, to illustrate our collective underestimation. To produce one tonne of steel, you need to extract 1.6 tonnes of iron ore and burn 770 kg of coal. For one tonne of concrete, 1.3 tonnes of sand are required. One two-megawatt wind turbine (which can power 2,000 houses) requires 295 tonnes of steel, 48 tonnes of iron and 1,300 tonnes of concrete.

Ultimately, we will remain beholden to the material world, and harnessing the power of raw materials depends upon the continued running of vast, intricate global supply chains.

Nuanced optimism

Now, and for the foreseeable future, resourcehungry industries are primarily concerned with finding the path of least resistance to the raw materials they need. Which brings us back to Cornwall, specifically Cornwall’s abundant copper.

The suggestion that we should dig great holes in the Cornish countryside to extract copper for industry is anathema to most British readers. Material World forces us to confront these tricky and essential questions. Ultimately, what price are we willing to pay to keep our modern world running?

But Conway doesn’t leave his readers to ruminate on the intractable problem that “the world’s twin goals of decarbonisation and development are heading for a collision.” Nor does Conway conclude with any blithe assumption about civilisation inevitably muddling its way through. No imaginary matriarch and her inventive offspring here.

Conway isn’t didactic in the slightest. Rather, we’re left with a deeper understanding of the critical importance of narrowing the gap between our ethereal society and our Material World.

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Piers Wheeler

Director – Institutional

T +44 (0)20 7963 8258

Developing and executing asset management strategy for capital raising and strategic relationship management. Coverage includes EMEA, Asia and Australia. Piers joined Ruffer in 2021, having previously worked with asset management firms including Eastspring, AMP Capital and LEK as a strategic consultant. He holds a MA from the Bayes Business School and a BA (Hons) from the University of Oxford.

Annabel Paterson

Senior Associate – Institutional

T +44 (0)20 7963 8123

Joined Ruffer in 2021, having graduated with a first class honours degree in land economics from the University of Cambridge. After two years working with the UK Private Wealth team and completing her IMC and CFA Level I qualifications, she now supports Ruffer’s global business development and client servicing efforts.

Articles by Annabel

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