Welcome back folks. When last we spoke in Bitcoin follies Part I, I outlined how the expanding cryptocurrency market would drive renewable resources not kill them. I also talked a bit about how energy storage was still the real issue we need to be talking about.
Where’s my power armour?
Did you know there’s only one thing stopping you from having your own set of power armour? Or a practical flying car? Or a jetpack? Or 100 per cent continent-wide Wi-fi? We’ve solved the engineering problems. There’s just no way to run any of these gizmos for more than five minutes before hitting the wall of our electricity storage tech.
Electricity is great. it does everything, from moving your muscles to playing DOOM. It’s a royal bitch to store. It wants to turn into heat and light as fast as possible, and keeping that em-effer quiet is the number one holy grail of materials engineering.
For the last decade, battery technology has followed an incremental improvement model. The basic technology is the same, an anode and a cathode in some kind of medium. The materials have been refined, manufacturing has improved, but no one’s found a practical way to make a serious jump in storage capacity, life-cycle or charge/discharge rates.
Every week there’s a story about some bright eyed engineer who can improve batteries by hundreds of percent. Invariably the process is A. Expensive, B. Delicate C. Non-Scalable or D. All of the above.
There are promising new ideas, but past history teaches us to be very wary. For the time being, we’ll have to go to war with the batteries we have, not the batteries we wish we had.
Do you even juice Bro?
Presuming the Doom-and-Gloomers to be correct, the future will be about two things, water and electricity. Power to run the modern economy and clean water so we don’t die. Since water futures and politics is a whole other kettle of (freshwater) fish, I’mma stick to electricity.
Since we don’t have the magic ARC reactor Tony Stark uses as a power source, any storage needs will have to be met by current battery technology. There are multiple pressures from different sectors, driving growth in the battery market.
First the power needs of an expanding bitcoin and Crypto market will drive capacity. The commitment by places such as China and Switzerland to wind, solar and other renewables will ensure the need for massive parallel banks of batteries as it is the solution-du-jour.
Next, the electric vehicle revolution will only continue to grow. Last week I noted Budweiser had ordered 40 electric trucks from Tesla. Today, PepsiCo announced they were ordering 100. You can take a look at my piece to see what my analysis of this trend is all about.
The growing need for power, the storage of that power plus the demand for electric vehicles makes investing in battery markets very promising.
This is a clear trend, but it’s still gathering steam. To get in on the action I suggest looking at energy metals. I’d plagiarize myself, but I can explain it again just as easily…
Energy metals such as Lithium, Graphite and Cobalt are essential to the latest generation of batteries.
Other metals like Vanadium are important too, but those are the big three. We have a lot of clients and analysis in this sector. I’d recommend checking it out. Energy metals are the hot young thing right now, the money is spilling over from Crypto – but fundamentally, there’s a lot of money in the ground.
Once the big Bitcoin boom ends, even if it’s in the 2020s with the final BTC being mined, those computers will still exist – someone will find a use for them, and they will need power. Barring a black swan technological breakthrough, the best bet is to be selling shovels to gold miners, or in this case, battery metals to Elon Musk.
Next time Part III: Bitcoin, The Long Play (Buy, Forget, Get Rich)
FULL DISCLOSURE: Equity Guru has Blockchain and Energy Metal clients. I do not own stock in any of them. I do however own some old Xbox 360 power packs that still hold a charge.