Renewables Disadvantage - Gonzaga 2014

***Rare Earth Metals DA

Hegemony DA

1NC ShellRare earth supply and demand is stable now but supply is limited – the plan causes supply shortages and bottlenecksSnyder, Bloomberg writer, 12 [Jim, 1/5/12, Bloomberg News, “Five Rare Earths Crucial for Clean Energy Seen In Short Supply,” http://www.bloomberg.com/news/2012-01-05/five-rare-earths-crucial-for-clean-energy-seen-in-short-supply.html]Falling Prices While prices of rare earths fell in the second half of 2011, they remain volatile, leading some companies to search for ways to consider reducing reliance on the minerals, the Energy Department said. The department is also researching how to use rare-earths more efficiently, including through recycling, and to increase production in the U.S. The department’s Advanced Research Projects Agency--Energy has given about $31.6 million to 14 research projects to study ways to reduce or eliminate use of rare-earth elements. In Congress, at least a dozen bills have been introduced supporting development of a domestic rare-earth industry, including through U.S. loan guarantees, according to the Energy Department report. None of the measures has passed. “The biggest challenge is a permitting system that has historically taken multiple years to go from exploration to production,” Daniel McGroarty, president of Lonoke, Arkansas- based U.S. Rare Earths Inc. (UREE), said in an interview. The company has claims in Colorado, Montana and Idaho, he said. Worldwide Demand The five minerals most at risk of supply disruptions are used to make wind turbines, solar panels, electric car batteries and energy-efficient lights, according to the report. A 2007 law requiring the phase-out of incandescent light bulbs may increase demand for terbium, europium and yttrium, used in compact fluorescent bulbs that comply with higher efficiency standards, according to the report. “While these materials are generally used in low volumes relative to other resources, the anticipated deployment of clean-energy technologies could substantially increase worldwide demand,” the report said. Smaller mining companies have difficulty raising the $100 million to $1 billion it takes to open a rare-earth ore mine, while global mining companies are often not interested because of the relatively small size of the $3 billion market and its unpredictability, the report said. The report also recommends greater emphasis on education and job training. “Strengthening the U.S. position across the supply chain requires a capable workforce,” the report said.The plan causes massive bottlenecks and tradeoffs that collapse competing industries and prevent a transition to renewablesSpence, writer for EurActiv, 11 [Timothy, 11/16/11, "Rare-earth shortage to hamper clean energy: EU study," www.euractiv.com/sustainability/rare-earth-shortage-hamper-clean-news-508967]Looming shortages of metals that are in high demand and dominated by a single supplier – China – threaten Europe’s goals for cleaner transport and sustainable energy, says a new study prepared for the European Commission. The study by the Joint Research Centre says supply shortfalls of component metals in the next two decades risk the production of solar, wind and nuclear technologies as well as electric vehicles and carbon-capture systems. “This adds more evidence to the fact that Europe has to look within itself … and more toward waste management, to re-use existing metals,” said Dr. Raymond Moss, lead author of the report. The findings could have serious implications for the EU’s “Roadmap for moving to a low-carbon economy in 2050” that hinges on development of renewable energy, cleaner transport as well

as modernising and integrating Europe’s electricity grids. Such ambitions depend heavily on the availability of neodymium, dysprosium, indium, tellurium and gallium, metals that are in demand globally. EU’s vital raw materials The Commission has already identified many so-called rare-earth minerals as well as metals like cobalt in its lists of 14 economically vital raw materials that are prone to supply disruption. The JRC study is part of the Commission’s examination of raw material needs. Europe depends on imports for nearly all of its rare-earth metals. Though many are in abundant supply on the planet, the metals are dispersed or difficult to access, and despite their importance to green energy, require intensive mining and processing. China controls more than 90% of the market. In July, the World Trade Organisation called on China to ease its export restrictions on 17 rare-earth metals important to energy, transport and electronics manufacturing. Shortages or limitations on supply would have serious impact on many industries. But with solar and wind power expected to account for the biggest energy growth markets over the next 20 years, the impact on alternative energy could be profound. The JRC report says five metals - dysprosium, neodymium, tellurium, gallium, and indium - are at the highest risk of supply “bottlenecks” from high demand, concentration of supply and “high political risks due to an extreme concentration of supply in China.” The study examines 14 rare-earth metals. Solar energy technologies, for example, will require half the current world supply of tellurium and 25% of the supply of indium, the report says. Europe’s wind energy technology will require about 4% of the supply of both neodymium and dysprosium. “While the percent might be small, it could have a significant effect on wind technology,” Moss told EurActiv. The concern, he said is that “90 percent of the source is in China at the moment, and they themselves have a rapidly growing demand for the same metals whilst they have also limited restrictions on export.”Government Incentivized renewables production trades off with military acquisition of rare earthsBurnett, senior fellow with the Natonal Center for Policy Analysis, 11 [Sterling, 11/1/11, NCPA, "Will Green Energy Make the United States Less Secure?," www.ncpa.org/pub/ib103]The more the United States embraces green energy technologies, the worse off it will be geopolitically and economically. Demand for green energy would fall if there were not huge government subsidies, grants and mandates, because green energy is more expensive and less reliable than traditional energy production. As the push to adopt rare earth-intensive energy technologies intensifies, those concerned about U. S. energy security could find that the tradeoff involves swapping one form of dependence for a much more perilous one. In addition, the diversion of scarce rare earths to green energy technologies means that there is less available for critical aerospace and military technologies.Rare earth acquisition is key to nuclear primacy - guided missiles, first strike capabilitiesKennedy, President of Wings Enterprises, internationally recognized expert on rare earths, 10 [J. Kennedy, March 2010, “Critical and Strategic Failure of Rare Earth Resources,” http://www.smenet.org/rareEarthsProject/TMS-NMAB-paperV-3.pdf)The national defense issues are equally important. Rare earths are critical components for military jet engines, guided missiles and bombs, electrical countermeasures, anti-missile systems, satellite communication systems and armor, yet the U.S. has no domestic sources. Innovation Drives Industry – Industry Carries the Economy Advances in Materials Science are a

result of tireless innovation; innovation seeking improvements in the performance and characteristics of material properties or a change in their form or function. Much of this work must eventually translate into commercial and military applications. Today many advances in material science are achieved through the application of rare earth oxides, elements and alloys. This group of elements, also known as the lanthanide series, represents the only known bridge to the next level of improved performance in the material properties for many metallurgical alloys, electrical conductivity, and instrument sensitivity and in some cases a mechanical or physical change in function. These lanthanides hold unique chemical, magnetic, electrical, luminescence and radioactive shielding characteristics. Combined with other elements they can help maintain or alter physical and structural characteristics under changing conditions. Today, these rare earth elements are essential to every computer hard drive, cell phone, energy efficient light bulb, many automotive pollution control devices and catalysts, hybrid automobiles and most, if not all, military guidance systems and advanced armor. Tomorrow, they will be used in ultra capacity wind turbines, magnetic refrigeration, zero emission automobiles, superconductors, sub-light-speed computer processors, nano-particle technologies for material and metallurgical applications, structurally amorphous metals, next generation military armor and TERFENOL-D Radar. America must lead in these developments. The entire U.S. defense system is completely interdependent upon REO enhanced technologies for our most advanced weapons guidance systems, advanced armor, secure communications, radar, advanced radar systems, weapons triggering systems and un-manned Drones. REO dependent weapons technologies are predominantly represented in our ‘first strike’ and un-manned capabilities. This national defense issue is not a case of limited exposure for first-strike capabilities. This first-strike vulnerability translates into risk exposure in every level of our national defense system, as the system is built around our presumptive technological and first-strike superiority. Yet the DoD has abandon its traditional procurement protocols for “strategic and critical” materials and components for weapons systems in favor of “the principles of free trade.”Loss of U.S. nuclear primacy causes global nuclear war Caves, Senior Research Fellow in the Center for the Study of Weapons of Mass Destruction at the National Defense University, 10 [John P. Caves Jr., January 2010, “Avoiding a Crisis of Confidence in the U.S. Nuclear Deterrent,” Strategic Forum, No. 252]Perceptions of a compromised U.S. nuclear deterrent as described above would have profound policy implications, particularly if they emerge at a time when a nuclear-armed great power is pursuing a more aggressive strategy toward U.S. allies and partners in its region in a bid to enhance its regional and global clout. A dangerous period of vulnerability would open for the United States and those nations that depend on U.S. protection while the United States attempted to rectify the problems with its nuclear forces. As it would take more than a decade for the United States to produce new nuclear weapons, ensuing events could preclude a return to anything like the status quo ante. The assertive, nuclear-armed great power, and other major adversaries, could be willing to challenge U.S. interests more directly in the expectation that the United States would be less prepared to threaten or deliver a military response that could lead to direct conflict. They will want to keep the United States from reclaiming its earlier power position. Allies and partners who have relied upon explicit or implicit assurances of U.S. nuclear protection as a foundation of their security could lose faith in those assurances. They could compensate by accommodating U.S. rivals, especially in the short term, or acquiring their own nuclear deterrents, which in most cases could be accomplished only over the mid- to long term. A more nuclear world would likely ensue over a period of years. Important U.S. interests could

be compromised or abandoned, or a major war could occur as adversaries and/or the United States miscalculate new boundaries of deterrence and provocation. At worst, war could lead to state-on-state employment of weapons of mass destruction (WMD) on a scale far more catastrophic than what nuclear-armed terrorists alone could inflict.

2NC – DeterrenceDeterrence key to preventing global nuclear wars and acts as a conflict dampener Murdock, senior advisor in the CSIS International Security Program, 8[Clark, March 2008, “The Department of Defense and the Nuclear Mission of the 21st Century,” A Beyond Goldwater-Nichols Phase 4 Report ISBN 978-0-89206-525-7]The violence-suppressive effect of nuclear weapons has not gone away with the end of the Cold War. Noted Cold War deterrent theorist and Nobel economics laureate Thomas Schelling told a recent World Economic Forum retreat (according to Thomas Barnett, the Pentagon’s favorite futurist) that (1) no state that has developed nuclear weapons has ever been attacked by another state and (2) no state armed with nuclear weapons has ever attacked another state similarly armed.18 With his characteristic flair, Barnett observes that the United States and the Soviet Union learned that nuclear weapons are for having and not using. Due to the equalizing threats of mutually assured destruction, these devices cannot win wars but only prevent them. The same logic has held—all these decades—for powers as diverse as the United Kingdom, France, China, India, Pakistan and Israel, with North Korea stepping up to the plate and Iran on deck. Thus we have survived the democratic bomb and the totalitarian bomb, as well as the capitalist bomb and the communist bomb. In religious terms, we have survived the Christian and atheist bombs, the Confucian and Hindu bombs and the Islamic and Jewish bombs. Somehow, despite all the “irrationalities” ascribed to each new member, the logic of nuclear deterrence holds fast.19 The proposition that nuclear weapons make the world “safe” for great power competition clearly belongs to the ranks of self-fulfilling prophecies, since it depends on the credibility of each state’s nuclear deterrent. Moreover, while it doesn’t make this author sanguine about the risks of further nuclear proliferation to states, regimes or individuals that are more difficult to deter, it seems to be the case that, to date, possession of a nuclear weapon has made the possessor, and its adversaries, much more cautious about embarking on courses of action that could escalate to nuclear use.

Tomahawk Deterrence ImpactRare earth metals are key to Tomahawk cruise missiles Husband, writer for Harvard Law National Security Journal, 12 [David, 3/7/12, "On-Shoring the Production of Rare Earth Metals," Harvard Law National Security Journal, harvardnsj.org/2012/03/on-shoring-the-production-of-rare-earth-metals/]Rare earth metals have numerous military applications. The U.S.-China Economic and Security Review Commission has a mandate to submit “an annual report on the national security implications of the bilateral trade and economic relationships between the United States and the People’s Republic of China.” According to the Commission, rare earth metals play a critical role in “sophisticated military applications including guidance and control systems; advanced optics technologies; radar and radiation detection equipment; and advanced communications systems. Some of the defense related weapons and equipment that contain rare earths are: Predator unmanned aerial vehicles, Tomahawk cruise missiles, Zumwalt-class destroyers, night vision goggles, smart bombs, and sonar transducers.” The Commission also notes that the United States was once the world leader of the rare earth metals industry, accounting in 1984 for at least one-third of global exports, a position that China successfully challenged through heavy governmental subsidies of non-profitable mines.The Tomahawk is key to deterrence and preventing nuclear escalationReynolds, Naval Postgraduate School, 98 [Guy, December, "The Nuclear-Armed Tomahawk Cruise Missile: Its Potential Utility on United States and United Kingdom Attack Submarines,", www.dtic.mil/cgi-bin/GetTRDoc?AD=ADA359545]The process of analyzing complex strategic questions is called Grand Strategy. The ability to step back and look at the entire picture has sometimes allowed the United States to focus on long-term goals and on shaping the future security environment rather than simply reacting to events. Steps in any policy area should be taken only after thorough deliberation and in the light of the nation's grand strategy. The United States has agreed to consider the possible limitation of sea-launched nuclear Tomahawk cruise missiles, but the United States evidently has no long-term strategy concerning the future of nuclear Tomahawk. The nuclear Tomahawk could be used in lieu of for gravity bombs, as a response to a rogue state or terrorist use of a weapon of mass destruction, or as a hedge reserve weapon. The United States should adopt a clear strategy concerning nuclear Tomahawk cruise missiles before considering any limitations. B. THE POSSIBLE USE OF A NON-STRATEGIC NUCLEAR WEAPON When might the United States consider using a non-strategic nuclear weapon? This is a difficult question to answer, given the accuracy and destructive capability of modern conventional weapons. The question must be answered before decisions are taken on the future of non-strategic nuclear weapons. The answer depends on the political and military requirements involved. U.S. military doctrine states that "the employment of nuclear weapons must offer a clearly significant advantage over nonnuclear munitions." 81 While debating the ratification of the United Nations Convention on Chemical Weapons, the U.S. Senate attempted to clarify when the use of non-strategic nuclear weapons might be considered. William Perry, then the Secretary of Defense, was questioned concerning the use of chemical weapons against United States military forces. Senator Pell asked, "If, God forbid, another country did stage a chemical weapon attack, what would be the response: Would it be—are you thinking in terms of nuclear weapons? Are you thinking in terms of conventional weapons? What would be the means of responding?" 82 Perry answered: We would not specify in advance what our response to a chemical attack is except to say it would be

devastating. And we have a wide range of military capabilities to make good that threat. 83 Because politicians are reluctant to rule out military options, they avoid defining the circumstances in which a non-strategic nuclear weapon might be used. This approach has been referred to as the strategy of "calculated ambiguity," Non-strategic nuclear weapons might be employed as a possible response to the use of a weapon of mass destruction. This might be difficult or impossible if the responsible party cannot be identified. U.S. strategy toward weapons of mass destruction emphasizes preventing proliferation and maintaining capabilities that would diminish the value of their use by other nations. Part of America's deterrent capability resides in its non-strategic nuclear weapons. President Clinton addressed the proliferation of weapons of mass destruction in Executive Order 12938. I, William J. Clinton, President of the United States of America, find that the proliferation of nuclear, biological, and chemical weapons (“weapons of mass destruction") and of the means of delivering such weapons, constitutes an unusual and extraordinary threat to the national security, foreign policy, and economy of the United States, and hereby declare a national emergency to deal with that threat. 84 President Clinton reaffirmed the importance of this executive order by extending its effectiveness and adding additional measures on 28 July 1998. The order contained diplomatic, commercial, and administrative remedies to respond to proliferation, but did not include military measures that might be considered. The ambiguity in the political considerations for the use of a nuclear weapon is intentional. Statements such as "all available responses" or "devastating response" have been used to indicate that nuclear weapons could be considered without making a clear overt threat. Nuclear weapons are used as a tool to prevent war or to deter escalation to higher levels of violence. In the case of WMD, a non-strategic nuclear weapon might be used to prevent further escalation and the outbreak of a much larger general war. James Baker has described the condition as living with ambiguity. 85 According to Baker, The demise of the Soviet Union decreased the risk of global thermonuclear war while increasing the possibility of lesser, but still dangerous, regional conflict. International power has been diffused and international discipline loosened. Under these circumstances, the proliferation of weapons of mass destruction raises the possibility of a "New World Disorder" with a vengeance. 86 The disorder that may result is exactly why United States nuclear policy must remain ambiguous. Ambiguity ensures that there will be flexibility in any policy position and liminates hollow threats. Flexibility in strategy and the strength to consider all response options are the keys to coping with a turbulent security environment. Employment doctrine should be unambiguous. Employment doctrine does not address when to respond, but how to respond once authorized and ordered to do so by civilian authority. The Joint Chiefs of Staff Doctrine for Joint Theater Nuclear Operations describes the possible enemy forces and facilities that might warrant a non-strategic nuclear military response. The possession or use of weapons of mass destruction is covered under non-state actors as well as state actors. Non-state actors and weapons of mass destruction, including their delivery systems, are described as "likely candidates" for the use of a nuclear weapon. 87 The best choice today against these target types might be a single non-strategic nuclear weapon if the civilian National Command Authority determined that the use of a nuclear weapon was indeed necessary. The advantages offered by nuclear Tomahawk are that "heavily defended areas may be penetrated without risk to crew, highly mobile platforms in international waters serve as launch sites, weapons are highly accurate, launching platform is recallable, basing issues are simplified, and maximum stealth and surprise can be maintained prior to launch." 88 These advantages make nuclear Tomahawk the best weapon system choice to accomplish difficult non-strategic nuclear missions.

Nuclear deterrence prevents extinction – deters rogue states, halts proliferation, and deescalates conflicts worldwide – modernization is key. Bruner and Cockey, Office of the Chief of Naval Operations, 14 [Rear Admiral Barry, Captain Michael, February, Office of the Chief of Naval Operations, Proceedings Magazine Vol. 140/2/1,332, “Now Hear This – We Must Have Nuclear Deterrence,” http://www.usni.org/magazines/proceedings/2014-02/now-hear-we-must-have-nuclear-deterrence) [Gender Modified]We are on the precipice of a different world. As Iran pursues nuclear capability, Kim Jong-un rattles his saber while threatening the United States and its regional allies with a nuclear weapon. North Korea’s closest neighbors, South Korea and Japan, are watching closely, knowing we are their shield. They live daily with the threat of an enemy that casually and repeatedly speaks of using nukes and has demonstrated its ability to attack without warning, as it did when its submarine sank the South Korean ship Cheonan on 26 March 2010. Should these countries decide they need their own nuclear weapons, they certainly have the technology and the ability to build them , thereby significantly raising the stakes and the likelihood of war. Enter deterrence. U.S. nuclear deterrence should: • Discourage such attacks against the United States by ensuring the ability to deliver an overwhelming response in kind • Make us resistant to coercion by adversaries using the threat of such an attack to induce concessions • Reduce the chance of large-scale conventional war between nuclear-armed adversaries because of the shared fear of escalation • Extend a guarantee to allies and partners, reducing the proliferation of these weapons and, thus, the likelihood of their use The mission of our nuclear forces is to threaten what an adversary values, thereby averting an attack of this nature on us, our friends, or our regional partners. Deterrence is a matter of perceptions . Its effect takes place in the mind of an opponent living in another country with different values, pressures, and goals. Its purpose is to influence the other[‘s] guy’s decision making, not ours. This is so simple, yet so easy to forget. The world’s foremost experts struggle to decipher Kim Jong-un’s thought process, but he may well believe he cannot survive without these weapons. He may feel that they are his source of power. It is possible he believes he holds the ultimate trump card and threatens using nuclear weapons to influence calculations in future international engagements. Nine countries have this capability. This means conflicts similar to those playing out with North Korea and to a lesser degree Iran will continue to make headlines. The value of our deterrence is that it limits aggressors to threats. They cannot hold us or our partners at risk because we maintain forces that are credible, survivable, and ready. Additionally, our nuclear power may delay hostile action long enough for negotiations to relieve tensions. Kim Jong-un must understand that if he attacks, we will respond with a strong resolve, and that we have an assured second-strike capability. What is more, our readiness influences China and Russia , both nuclear-capable countries with wide ties and significant sway. The credibility of our nuclear forces and our resolve must remain clear to these great powers as they exert pressure on rogue leaders. And we must remember that decisions we make now affect the believability of our deterrence later, as we analyze an uncertain future based on what we know today and our best estimate of coming trends. As our nuclear forces reach the end of their lives, we must take action to keep our capability strong and flexible. President Barack Obama has taken a position consistent with those of many prior administrations. The responsible action now is for us to reaffirm our embrace of a strong nuclear deterrent, thus reducing the chances of proliferation

and miscalculation. We must not flinch from this critical test of national character. Our planned 12 ballistic-missile submarines will provide strategic nuclear deterrence into the 2080s. As we debate the merits of various programs over coming years, we must not lose sight of the fact that they guarantee our very existence, deterring potential enemies from using weapons with unimaginable consequences.

REMs K2 HegRare earth dependence can collapse US military offensives in months – fastest internal link to heg Barry, Editor At Global Asset Strategist, 10 [Jennifer, 10/22/10, Financial Sense, “China's Rare Earth Revenge,” http://www.financialsense.com/contributors/jennifer-barry/china-rare-earth-revenge]For decades, China has slowly increased their market share in rare earth metals, but this year marks a quiet crisis in these elements. As James Dines reported in a recent interview, the Chinese now produce 97% of rare earth oxides and have cut back sharply on exports, slashing them 72% for the second half of 2010. These quotas are causing price spikes from panic buying. I decided to research why China would slash their rare earth exports. One major factor in China’s decision is surging domestic demand. The nation needs to reserve these key metals for their own future. With more than 1.3 billion citizens and a rapidly expanding economy, the Chinese consume 60% of world demand. While China is the dominant producer of REEs, the nation only holds 36% of known global reserves according to energy analyst Marc Humphries. The rate of mineral exploitation is unsustainable, and it makes sense for Beijing to assure they retain enough REEs to carry out their plans for development. As an anonymous Chinese expert put it, “It's unwise to drain the pond to catch all the fish." Just as China moved from a major exporter of crude oil to one of the biggest importers, some pundits believe that China will even have to import certain rare earths by 2015 for certain high tech products like super magnets for wind turbines. To back up this theory, China attempted to purchase Australian REE miner Lynas Corporation last year. China is not just interested in hoarding a depleting store of rare earths. According to the People’s Daily, much of the government’s concern is environmental. The area around Baitou - where the majority of production occurs - was polluted by toxic chemicals used to process this ore. Much of the damage was caused by illegal, uncontrolled mining operations. Even worse, the contamination happened while much of these valuable resources were wasted due to the use of outdated technology. While many analysts doubt that Beijing cares about ecological damage, I believe this is truly a motive for Chinese leaders. Up to 5% of China’s economic output is lost due to environmental destruction each year, as well as 400,000 excess deaths. Over the past decade, the nation has made great strides in improving the environment. China increased its forest cover and lessened both air and water pollution. It’s also making huge investments in green energy like solar and wind power to wean itself away from coal. Decades of Planning China did not reach 97% of rare earth oxide production by accident. The nation has always been a long term planner. In the 1960s, leaders realized the significance of REE deposits. Deng Xiaoping stated, “The Middle East has oil, and China has rare earths.” However, the country wasn’t a major player in the rare earth market until 1985. In that year, China significantly increased production at their Bayan Obo mine. These elements could be mined very cheaply as they are a by-product of iron ore production. In addition, the elements are relatively easy to extract, with low radioactivity. At the same time, electronics manufacturing was outsourced to Asia, and it made sense to source raw materials like REEs locally as well. With lower costs for labor and fewer regulations, China was able to outcompete other countries like Australia easily. Foreign mines were shuttered due to unprofitability or environmental concerns. By 1996, the Chinese had totally dominated the market, and most of the technical expertise had

been transferred to the East. China funds continued research in REEs in order to develop new applications and keep their lead in this field. Now that the Chinese control the rare earth market, the government has decided to reorganize the entire industry. Smuggling and illegal mining will no longer be tolerated. Ninety mining companies will be consolidated into 20 by 2015 to improve efficiency. In Inner Mongolia, the Baotou Steel Rare-Earth company will be the only legal miner, and 9% of annual production will be saved in stockpiles. Chinese leaders are also considering creating official state reserves. China’s Revenge These decisive moves from China have upset countries that manufacture items containing REEs, most notably Japan. In August, Japan begged the Chinese to ease restrictions on exports as surging prices are hurting corporations. The Japanese argued that these cuts were harming Chinese companies that depend on finished parts from Japan containing these elements. The Japanese government was so concerned about the impact on its manufacturing base that it sent 160 business leaders to China for economic talks. Despite these entreaties, China was not very flexible, citing WTO rules that allow quotas for environmental protection. In fact, Chinese leaders suggested that Japan implore other countries to produce more rare earths rather than depend on their output. The Japanese realized they had little bargaining power, so they agreed to transfer technology on purifying REEs. In fact, China is in the position to demand territorial concessions in exchange for access to these metals. I’m sure that the Chinese are enjoying turning the tables on the Japanese, even if only economically. These two nations have been rivals for centuries, with the first recorded battle occurring in 663 AD. Japan has borrowed many aspects of Chinese culture from its writing system to philosophy, but these contributions are rarely credited by the Japanese. Most of the source of Chinese anger is directed at Japan’s aggressive military history. Japan has repeatedly invaded and occupied Chinese territory, most recently from 1931 to 1945. Hundreds of thousands of civilians were massacred in Nanking, and other atrocities like medical experiments were perpetrated on the public. This rage simmers below the surface today, as massive anti-Japanese demonstrations occurred as late as 2005. While Japan seems unwilling to make formal reparations or an apology for the occupation, the nation has quietly been China’s largest financial aid donor for years. To cope with supply disruption, Japanese corporations are are reformulating products so they no longer require rare earth elements to work. Hitachi has developed a motor that uses an iron alloy instead of dysprosium, but the prototype is not large enough yet for production. The Teijin Group has also successfully produced a new magnet out of iron and nitrogen, replacing one using REEs. However, I doubt that these elements can be replaced everywhere in the supply chain, as they have unique qualities which prompted their use in the first place. US Military Vulnerable Although the US is not a major manufacturer of high tech consumer products containing REEs, the military is dependent on them. As modern weapons from smart bombs to tanks require these metals, the ability of America to wage war depends on a steady supply of rare earths. The US was not always dependent on the continued goodwill of foreign countries for critical materials. The National Stockpile was established after World War II to assure that essential elements would be available in case of an emergency. In the 1990s, the US Department of Defense (DOD) decided that 99% of the stockpile was “surplus” and the vast majority was sold. Although China has dominated the rare earth market since the mid-1990s, the US government was unconcerned about Chinese control of these elements for many years. Only in April 2009, did the DOD and Congress finally place a freeze on the sale of some materials, and decide to conserve a minimum of a one year supply for others.

While the US House of Representatives has passed a bill to promote locating and exploiting rare earth resources, I wonder if this action is too little too late. Not only are these metals necessary for weapons, but for “green” technology that attempts to lessen dependence on foreign oil, supplied mostly by countries unfriendly to the US. While the Mountain Pass mine in California was allowed to reopen, and Congress may subsidize more rare earth resource development, it takes 7 to 15 years to move from a promising deposit to a producing ore body. With inadequate domestic stockpiles, China could shut down America’s military offensives in a matter of months.

Prefer our internal link – increased wind and solar development specifically trades off with effective military technology – alternative metals will ruin US military primacyHurst, Research Analyst in the Foreign Military Studies Office at Fort Leavenworth, 10 [Cindy A. Hurst, NDU, "China's Ace in the Hole: Rare Earth Elements," Joint Force Quarterly Issue 59, October 2010 www.ndu.edu/press/chinas-ace-in-the-hole.html]Of course, not all REEs are created equal. Some experts predict that by 2015 there will be a shortage of neodymium, terbium, and dysprosium, while supplies of europium, erbium, and yttrium could become tight.9 The neodymium-iron-boron (NdFeB) permanent magnets are so strong that they are ideal for the miniaturization of a variety of technologies, including possible nanotechnologies. Many solid state lasers use neodymium due to its optimal selection of absorption and emitting wavelengths. Consumption of neodymium is expected to increase significantly as more wind turbines come online. Wind may be "free," but some of the newer generation wind turbines use up to two tons of these magnets. Terbium and dysprosium can be additives to enhance the coercivity in NdFeB magnets.10 Yttrium is used, along with neodymium, in lasers. Europium is the most reactive of the REEs. Along with its current use in phosphors for fluorescent lamps and television/computer screens, it is being studied for possible use in nuclear reactors.11 Erbium is used as an amplifier for fiber optic data transmission. It has also been finding uses in nuclear applications and metallurgy. For example, adding erbium to vanadium, a metal used in nuclear applications and high-speed tools, lowers the hardness and improves the workability of the metal. Samarium is another REE used in military applications. Samarium is combined with cobalt to create a permanent magnet with the highest resistance to demagnetization of any material known. Because of its ability to withstand higher temperatures without losing its magnetism, it is essential in both aerospace and military applications. Precision-guided munitions use samarium-cobalt (SmCo) permanent magnet motors to direct the flight control surfaces (fins). SmCo can also be used as part of stealth technology in helicopters to create white noise to cancel or hide the sound of the rotor blades. These magnets are used in defense radar systems as well as in several types of electronic countermeasure equipment, such as the Tail Warning Function.12 According to the U.S. Geological Survey, substitutes are available for many rare earth applications, but they are generally less effective. 13 Steven Duclos, chief scientist with General Electric Global Research asserts, "There's no question that rare earths do have some properties that are fairly unique, but for many applications these properties are not so unique that you cannot find similar properties in other materials. [REEs] are just better, from either a weight, strength, or optical property and that's why people have moved to them." Duclos went on to explain, "It always comes down to a tradeoff. You can build a motor that does not have rare earth permanent magnets in it. It will be bigger and heavier for a given amount of power or torque that you

want."14 Some scientists argue that in many cases, while there may be substitutes, the tradeoff would diminish military superiority. According to George Hadjipanayis, a Richard B. Murray Chair Professor of Physics at the University of Delaware, the alnico and ferrite magnets, the first two permanent magnets ever produced, do not have rare earth in them and their performance is much lower. Hadjipanayis is currently working with a group of researchers to develop a "next generation magnet" that will be stronger than either the NdFeB or SmCo magnets. The project is being conducted using a three-tiered approach:15 The University of Nebraska is striving to develop a permanent magnet that does not require rare earth. The U.S. Department of Energy's Ames Laboratory in Iowa is pursuing options that might use new materials based on combinations of rare earths, transition metals, and possibly other elements that have not been used with magnets before. The University of Delaware is striving to create a new magnetic material that is based on an idea of "nano-composite" magnets. It is a complex process that could slash the use of neodymium or samarium in magnets by 30 or 40 percent.16 Rare earth permanent magnets constitute the widest use of REEs. In the 1960s, the United States was number one in the research and development of magnets. The Nation enjoyed many technological breakthroughs until about the early 1980s. Since the discovery of the NdFeB magnet in 1983, research and development in the United States has been relatively flat.17

China DA

1NC ShellRare earth supply and demand is stable now but supply is limited – the plan causes supply shortages and bottlenecksSnyder, Bloomberg writer, 12 [Jim, 1/5/12, Bloomberg News, “Five Rare Earths Crucial for Clean Energy Seen In Short Supply,” http://www.bloomberg.com/news/2012-01-05/five-rare-earths-crucial-for-clean-energy-seen-in-short-supply.html]Falling Prices While prices of rare earths fell in the second half of 2011, they remain volatile, leading some companies to search for ways to consider reducing reliance on the minerals, the Energy Department said. The department is also researching how to use rare-earths more efficiently, including through recycling, and to increase production in the U.S. The department’s Advanced Research Projects Agency--Energy has given about $31.6 million to 14 research projects to study ways to reduce or eliminate use of rare-earth elements. In Congress, at least a dozen bills have been introduced supporting development of a domestic rare-earth industry, including through U.S. loan guarantees, according to the Energy Department report. None of the measures has passed. “The biggest challenge is a permitting system that has historically taken multiple years to go from exploration to production,” Daniel McGroarty, president of Lonoke, Arkansas- based U.S. Rare Earths Inc. (UREE), said in an interview. The company has claims in Colorado, Montana and Idaho, he said. Worldwide Demand The five minerals most at risk of supply disruptions are used to make wind turbines, solar panels, electric car batteries and energy-efficient lights, according to the report. A 2007 law requiring the phase-out of incandescent light bulbs may increase demand for terbium, europium and yttrium, used in compact fluorescent bulbs that comply with higher efficiency standards, according to the report. “While these materials are generally used in low volumes relative to other resources, the anticipated deployment of clean-energy technologies could substantially increase worldwide demand,” the report said. Smaller mining companies have difficulty raising the $100 million to $1 billion it takes to open a rare-earth ore mine, while global mining companies are often not interested because of the relatively small size of the $3 billion market and its unpredictability, the report said. The report also recommends greater emphasis on education and job training. “Strengthening the U.S. position across the supply chain requires a capable workforce,” the report said.Sudden energy investment skyrockets rare earth prices – that devastates manufacturers and deters innovation across all industries – that flips the aff Epstein, writer for the Chicago Policy Review, 12 [Nicholas, 7/12/12, “Medium Rare: What’s Cooking in the Rare Earth Element Market?.” http://chicagopolicyreview.org/2012/07/12/medium-rare-whats-cooking-in-the-rare-earth-element-market/]REE supplies are vulnerable for several reasons. Most importantly, one nation, China, controls 98 percent of the world’s REE production. Further, REEs are found together in geological formations. As a result, REEs are co-mined, so production is highly concentrated geographically. Lastly, Rare Earth extraction has negative environmental impacts and China’s poor labor standards add social concerns to the supply market.The authors identify circumstances under which REEs may experience revolutionary demand, that is, when new sudden technological innovations sharply increase the demand for REEs. They explain that revolutionary demand changes can lead to supply and price instability in the

materials market. This effect is harmful to manufacturers, who depend on a consistent supply-chain, and deters additional innovation.Chinese resource monopoly uniquely makes war more likely and more dangerous – export cutoffs destroy military effectiveness and collapse hard power Kim, writer for The Catalyst, 14 [William Kim, 2/23/14, The Catalyst, Colorado College, “Control of rare earth elements crucial to American stability,” http://catalystnewspaper.com/2014/02/23/control-of-rare-earth-elements-crucial-to-american-stability/]An episode of House of Cards deals with a crisis between China and the United States as a result of China cutting off US access to Samarium, a rare earth element. Unfortunately, this situation is not very far fetched. Rare earth elements are extremely important to the United States. They have vital applications in electronics, as they are used in the production of hard disks, smart phones, TV screens, and touch screens. Rare earth elements have also allowed electronics like headphones to become smaller, and they are critical to the energy sector. They are used in oil refineries, hybrid cars, wind turbines, nuclear control rods, energy efficient light bulbs, and solar panels. Other civilian applications include water treatment, medical imaging, and super alloys. Rare earth elements are even more important to the military. As a result of the Pentagon’s “network-centric” warfare doctrine, the US military is highly computerized, so all of the IT applications of rare earth elements apply to the military. Thus, these elements are found in tanks, warships, fighter jets, smart munitions, missile defense systems, satellites, and communication gear. Fighting a war without rare earth elements would be like fighting without fuel or ammunition . It’s no surprise that a Congressional finding called rare earth elements “ critical to national securit y.” Currently, China controls 97 percent of the world’s production of rare earth elements. This gives China a massive upper hand in international disputes. In response to a maritime dispute with Japan, China cut off rare earth exports to Japanese customers and cut global export quotas, claiming that they were trying to “fight pollution.” If China were to cut off rare earth exports to the United States in response to a trade war, military conflict, or a cold war, they would bring the United States to its knees economically and militarily. Given the fact that tensions still remain high in the South China Sea and the Strait of Taiwan, this is a dangerous situation for the US. It is critical that the United States finds alternate sources of rare earth elements. These sources do exist. Although China controls the vast majority of the world’s current production, it only has 37 percent of the world’s reserves. Despite the name, rare earth elements are actually relatively abundant. There are many rare earth element mines outside of China that were shut down after China undercut world prices in the 1990s. Surprisingly, the US was the largest producer in the 1980s. Mines in Australia are appearing online, and mines in the US, Brazil, Vietnam, Greenland and Canada could be online by 2015. The United States government should subsidize domestic rare earth production and encouragwe other countries to do the same in order to end China’s monopoly. Another source of rare earth elements is the piles of dirt and rock that were discarded during the gold rush. These mine tailings were once thought to be worthless, but could in fact be a “gold mine” of rare earth elements. Recycling rare earth elements is also an option. Japan has already built recycling plants that extract these elements from old hybrid car batteries and electronics. This would lead to additional environmental benefit, since rare earth mining and refining creates

toxic waste and emits carbon dioxide. In the long term, it may be possible to remove rare earth elements from the equation altogether. Companies and universities are trying to develop substitute materials with nanotechnology, as well as devices that do not need rare earth elements. However, these technologies remain elusive after years of research. As a short-term plan, the United States should create a prudent reserve of rare earth elements to add to the other stockpiles of strategically important resources like medicine and oil. There’s even a National Raisin Reserve! Since rare earth elements are vital to the American economy and military, there is no reason why the government should not have a national emergency stockpile of them. Many ask why the Allies won the Second World War. One of the reasons was that the Allies had far more natural resources, especially oil. The United States produced 60 percent of the world’s oil, and the remainder was largely produced by other Allied nations. Britain controlled the oil-rich Middle East, while the Soviet Union had significant oil reserves in the Caucuses. In contrast, the Germans had a few oil wells in Romania, but they had no efficient way of processing or transporting this oil (which was made harder by Allied bombing). The Japanese captured the oil rich Dutch East Indies early in the war, but American submarines made transportation difficult. Ultimately, Axis warships, planes, and tanks simply ran out of gas. Training had to be cut back, resulting in unskilled pilots and tank crews. Axis fleets and armies had to disengage or avoid fights altogether due to a lack of fuel. While a major great power war is far less likely now than it was in the 1900s, the United States faces a similar problem. Rare earth elements are about as important as oil to our military and economy. In the unlikely but possible event of war with China (or even a cold war for that matter), America would find itself in a similar predicament in regard to rare earth elements that Germany and Japan faced with regard to oil. The United States cannot let such a critical resource remain in the hands of a single foreign nation, particularly a nation that could be a major competitor for world power.

China war escalates to nuclear extinctionWittner, professor of history emeritus at SUNY Albany, 11[Lawrence, 11-30-2011, “Is Nuclear War with China Possible”, http://www.huffingtonpost.com/lawrence-wittner/nuclear-war-china_b_1116556.html, DOI 7/12014]While nuclear weapons exist, there remains a danger that they will be used. After all, for centuries international conflicts have led to wars, with nations employing their deadliest weapons. The current deterioration of U.S. relations with China might end up providing us with yet another example of this phenomenon. The gathering tension between the United States and China is clear enough. Disturbed by China's growing economic and military strength, the U.S. government recently challenged China's claims in the South China Sea, increased the U.S. military presence in Australia, and deepened U.S. military ties with other nations in the Pacific region. According to Secretary of State Hillary Clinton, the United States was "asserting our own position as a Pacific power." But need this lead to nuclear war? Not necessarily. And yet, there are signs that it could. After all, both the United States and China possess large numbers of nuclear weapons. The U.S. government threatened to attack China with nuclear weapons during the Korean War and, later, during their conflict over the future of China's offshore islands, Quemoy and Matsu. In the midst of the latter confrontation, President Dwight Eisenhower declared publicly, and chillingly, that U.S. nuclear weapons would "be used just exactly as you would use a bullet or anything else." Of course, China didn't have nuclear weapons then. Now that it does, perhaps the behavior of national leaders will be more

temperate. But the loose nuclear threats of U.S. and Soviet government officials during the Cold War, when both nations had vast nuclear arsenals, should convince us that, even as the military ante is raised, nuclear saber-rattling persists. Some pundits argue that nuclear weapons prevent wars between nuclear-armed nations; and, admittedly, there haven't been very many -- at least not yet. But the Kargil War of 1999, between nuclear-armed India and nuclear-armed Pakistan, should convince us that such wars can occur. Indeed, in that case, the conflict almost slipped into a nuclear war. Pakistan's foreign secretary threatened that, if the war escalated, his country felt free to use "any weapon" in its arsenal. During the conflict, Pakistan did move nuclear weapons toward its border, while India, it is claimed, readied its own nuclear missiles for an attack on Pakistan. At the least, though, don't nuclear weapons deter a nuclear attack? Do they? Obviously, NATO leaders didn't feel deterred, for, throughout the Cold War, NATO's strategy was to respond to a Soviet conventional military attack on Western Europe by launching a Western nuclear attack on the nuclear-armed Soviet Union. Furthermore, if U.S. government officials really believed that nuclear deterrence worked, they would not have resorted to championing "Star Wars" and its modern variant, national missile defense. Why are these vastly expensive -- and probably unworkable -- military defense systems needed if other nuclear powers are deterred from attacking by U.S. nuclear might? Of course, the bottom line for those Americans convinced that nuclear weapons safeguard them from a Chinese nuclear attack might be that the U.S. nuclear arsenal is far greater than its Chinese counterpart. Today, it is estimated that the U.S. government possesses over 5,000 nuclear warheads, while the Chinese government has a total inventory of roughly 300 . Moreover, only about 40 of these Chinese nuclear weapons can reach the United States. Surely the United States would "win" any nuclear war with China. But what would that "victory" entail? An attack with these Chinese nuclear weapons would immediately slaughter at least 10 million Americans in a great storm of blast and fire, while leaving many more dying horribly of sickness and radiation poisoning. The Chinese death toll in a nuclear war would be far higher. Both nations would be reduced to smoldering, radioactive wastelands . Also, radioactive debris sent aloft by the nuclear explosions would blot out the sun and bring on a " nuclear winter " around the globe -- destroying agriculture, creating worldwide famine, and generating chaos and destruction. Moreover, in another decade the extent of this catastrophe would be far worse. The Chinese government is currently expanding its nuclear arsenal, and by the year 2020 it is expected to more than double its number of nuclear weapons that can hit the United States. The U.S. government, in turn, has plans to spend hundreds of billions of dollars "modernizing" its nuclear weapons and nuclear production facilities over the next decade.

2NC – China Cut-offChina will respond by cutting off rare earth supply – that causes US-China conflictCohen, writer for NewScientist, 7 [David, 5/23/7, New Scientist, “Earth's natural wealth: an audit,” http://environment.newscientist.com/channel/earth/mg19426051.200-earths-natural-wealth-an-audit.html]These may sound like drastic solutions, but as Graedel points out in a paper published last year (Proceedings of the National Academy of Sciences, vol 103, p 1209), "Virgin stocks of several metals appear inadequate to sustain the modern 'developed world' quality of life for all of Earth's people under contemporary technology." And when resources run short, conflict is often not far behind. It is widely acknowledged that one of the key motives for civil war in the Democratic Republic of the Congo between 1998 and 2002 was the riches to be had from the country's mineral resources, including tantalum mines - the biggest in Africa. The war coincided with a surge in the price of the metal caused by the increasing popularity of mobile phones (New Scientist, 7 April 2001, p 46).Similar tensions over supplies of other rare metals are not hard to imagine. The Chinese government is supplementing its natural deposits of rare metals by investing in mineral mines in Africa and buying up high-tech scrap to extract metals that are key to its developing industries. The US now imports over 90 per cent of its so-called "rare earth" metals from China, according to the US Geological Survey. If China decided to cut off the supply, that would create a big risk of conflict, says Reller.

China will hold exports hostage – that turns clean tech developmentSchuessler, writer for Aljazeera America, 14 [Ryan, 1/30/14, Aljazeera America, “Missouri mine shines spotlight on global battle for rare-earth metals,” http://america.aljazeera.com/articles/2014/1/30/us-counts-on-pearidgerareearthsmine.html, accessed 7/19/14, TYBG]China’s export restrictions and supply-chain acquisition have taken U.S.-based operations to that country to receive a reliable source of rare earths needed for modern manufacturing. It has been a process that has played out over the last 25 years or so. In 1992, the then-leader of the Communist Party of China, Deng Xiaoping, said: “The Middle East has oil and China has rare earth.” The country has since lived up to that promise.Thirty years ago, U.S. production of rare earths was nearly three times that of China, just under 30,000 tons. However, U.S. production shut down in the early 21st century after being outdone by Chinese production, which had grown to approximately 70,000 tons and has continued to increase ever since.The most notable single example of China taking on the U.S. was in 1995, when Chinese companies acquired Magnequench, a GM subsidiary built in conjunction with the Department of Defense that developed high-tech magnets using the rare earth neodymium. By 2002, Magnequench’s facilities had been duplicated in China, and all U.S. operations were shut down.China’s actions have hardly gone unnoticed. Last year, the Bangalore, India–based National Institute of Advanced Studies released an independent report describing Chinese dominance of

the rare-earths industry. The report suggested that China’s upper hand, including the acquisition of Magnequench, was the “result of a well-thought out carefully crafted dynamic long term strategy.”These days China’s rare-earth production is almost equal to global rare earth consumption, around 135,000 tons. That gives China power, especially as the world economy moves ever more high tech. “If the advanced countries such as U.S.A. and some of the European countries want to build an economy which moves towards the Green Energy systems, then China being a major supplier of (rare earths) could hold these countries ransom,” said Lalitha Sundaresan, one of the authors of the study, in an email from India.China’s leverage also exists when it comes to military technology based on rare earths, used in radar systems, missiles and satellites, to name a few things. That gives China powerful influence in global diplomacy. In September 2010, reports emerged alleging that China had suspended exports of rare earths to Japan over an incident surrounding disputed islands in the South China Sea. Chinese officials continue to deny this claim, but rare-earth consumers nonetheless have been scrambling to find an alternative supply ever since.

Impact – Trade WarChinese REM dominance causes a trade war with the US – export quotas create conflict and exploitable military vulnerabilities.Robison & Ratnam 10 [Pentagon Loses Control of Bombs to China Metal Monopoly By Peter Robison and Gopal Ratnam - Sep 29, 2010 3:49 PM PT. http://www.bloomberg.com/news/2010-09-29/pentagon-losing-control-of-afghanistan-bombs-to-china-s-neodymium-monopoly.html]“The Pentagon has been incredibly negligent,” said Peter Leitner, who was a senior strategic trade adviser at the Defense Department from 1986 to 2007. “There are plenty of early warning signs that China will use its leverage over these materials as a weapon.” China may already be flexing its muscles amid a diplomatic spat with its East Asian neighbor Japan. China last week imposed a “de facto” ban on exports to Japan of the metals used in liquid crystal displays and laptop computers, Japanese Economy Minister Banri Kaieda said Sept. 28. That followed Japan’s detention of a Chinese fishing boat captain whose ship collided with two Japanese Coast Guard vessels. Japan later released the man. No such ban exists, China’s Ministry of Commerce spokesman Chen Rongkai said. New Factor “What it does, clearly, is bring a new factor into the consideration of supply of critical materials,” said Dudley Kingsnorth, director of Industrial Minerals Co. of Australia, a forecaster in Perth. The U.S. Congress’s investigative arm, the Government Accountability Office, in April warned of “ vulnerabilities” for the military because of the lack of domestic rare-earth supplies. The House of Representatives Armed Services Committee will hold a hearing in October, the same month a Pentagon report on how to secure future supplies of the metals is due. “The department has long recognized that rare-earth elements are important raw material inputs for many defense systems and that many companies in our base have expressed concern regarding the future availability of the refined products of these elements,” Brett Lambert, director of the Pentagon’s Office of Industrial Policy, said. While two rare-earth projects are scheduled to ramp up production by the end of 2012 -- one owned by Molycorp Inc. in California and another by Lynas Corp. in Australia -- the GAO says it may take 15 years to rebuild a U.S. manufacturing supply chain. China makes virtually all the metals refined from rare earths, the agency says. The elements are also needed for hybrid-electric cars and wind turbines, one reason supply may fall short of demand in 2014 even with the new mines, according to Kingsnorth of Imcoa. Doggy Day Care Just how far U.S. manufacturing has waned is apparent at a factory in Valparaiso, Indiana, where dogs skitter across a bare concrete shop floor, their nails clicking. This brick plant on Elm Street once made 80 percent of the rare-earth magnets in laser-guided U.S. smart bombs, according to U.S. Senator Evan Bayh, a Democrat from Indiana. In 2003, the plant’s owner shifted work to China, costing 230 jobs. Now the plant houses Coco’s Canine Cabana, a doggy day care the current tenants started to supplement sagging income from their machine shop. On most days dogs outnumber the 15 metalworkers, said Kathy DeFries, co-owner of Excel Machine Technologies Inc. “When things got slow for manufacturing, we had this big empty shop floor,” said DeFries, nuzzling a floppy-eared puppy. “It’s a great stress reliever.” Expensive to Mine The rare earths are chemically similar elements, with names such as yttrium and dysprosium. China has the largest share of worldwide reserves, about 36 percent, and the U.S. is second, with 13 percent, the U.S. Geological Survey says. While the elements aren’t rare, they’re less frequently found in profitable concentrations, expensive for Western producers to extract and often laced with

radioactive elements. China produced 120,000 tons, or 97 percent, of the world’s 124,000-ton supply last year, according to the GAO. Half of that came from Baotou, said Kingsnorth. The raw elements have many applications. Neodymium is used by Chinese companies including magnet makers, who sell to U.S. suppliers of defense contractors. Export Quotas Export quotas and taxes for overseas buyers that the GAO says can reach 25 percent are pushing up prices of elements even in relatively large supply. For example, the cost of a kilogram of samarium powder, needed for the navigation system of General Dynamics’ M1A2 Abrams tank, jumped to $34 in early September, from $4.50 in June, according to U.K. researcher Metal Pages Ltd. The U.S. and the European Union consider Chinese restrictions on a range of raw goods part of a strategy to draw in higher-paying manufacturing jobs by making them cheaper to buy inside China. The export taxes violate World Trade Organization rules because China pledged to limit them to 84 product categories when it joined the trade group in 2001, said Terence Stewart, managing partner of Washington law firm Stewart & Stewart. In 2010, China had taxes on 329, he said. The U.S. and the EU filed a WTO complaint over raw materials including bauxite and coke last year. China’s commerce minister, Chen Deming, said Aug. 28 that the policies comply with WTO rules. Some manufacturers in China are lobbying the ministry to back off the latest quotas because a dispute will disrupt the market, said Constantine Karayannopoulos, chief executive officer of Toronto-based Neo Material Technologies Inc., which has rare-earth production facilities in China. Risk of Trade War “ It was very sudden and didn’t give the industry any time to adjust,” he said. “ This quota action could risk a trade war . ” For Western companies, China’s policies are creating the real “unobtanium,” the fictional mineral fought over in James Cameron’s 2009 film “Avatar.” It’s taking as long as 10 weeks to get neodymium magnets, double the previous wait time, said Joe Schrantz, group supply chain manager at Moog Inc. in East Aurora, New York. He said the company buys hundreds of thousands of magnets a year to make motors for cars, trucks and weapons including Raytheon’s AMRAAM -- or Advanced Medium-Range Air-to-Air Missile -- and Boeing’s Joint Direct Attack Munition, a tail fin kit for making precision-guided “smart” bombs out of ordinary weapons.

Impact - US-China WarSupply bottlenecks lead to China warAnthony, lead editor at Ziff Davis, Inc., 11[Sebastian, December 30, 2011, Owner at SA Holdings, Past Columnist at Tecca, Editor at Aol (Weblogs, Inc), degree from University of Essex, “Rare earth crisis: Innovate, or be crushed by China”, Extreme Tech, http://www.extremetech.com/extreme/111029-rare-earth-crisis-innovate-or-be-crushed-by-china/2]The doomsday event that everyone is praying will never come to pass, but which every Western nation is currently planning for, is the eventual cut-off of Chinese rare earth exports. Last year, 97% of the world’s rare earth metals were produced in China — but over the last few years, the Chinese government has been shutting down mines, ostensibly to save what resources it has, and also reducing the amount of rare earth that can be exported. Last year, China produced some 130,000 tons of rare earths, but export restrictions meant that only 35,000 tons were sent to other countries. As a result, demand outside China now outstrips supply by some 40,000 tons per year, and — as expected — many countries are now stockpiling the reserves that they have. Almost every Western country is now digging around in their backyard for rare earth-rich mud and sand, but it’ll probably be too little too late — and anyway, due to geochemistry, there’s no guarantee that explorers and assayers will find what they’re looking for. The price of rare earths are already going up, and so are the non-Chinese-made gadgets and gizmos that use them. Exacerbating the issue yet further, as technology grows more advanced, our reliance on the strange and magical properties of rare earths increases — and China, with the world’s largest workforce and a fire hose of rare earths, is perfectly poised to become the only real producer of solar power photovoltaic cells, computer chips, and more. In short, China has the world by the short hairs, and when combined with a hotting-up cyber front, it’s not hard to see how this situation might devolve into World War III . The alternate, ecological point of view, is that we’re simply living beyond the planet’s means. Either way, strategic and logistic planning to make the most of scarce metals and minerals is now one of the most important tasks that face governments and corporations. Even if large rare earth deposits are found soon, or we start recycling our gadgets in a big way, the only real solution is to somehow lessen our reliance on a finite resource. Just like oil and energy, this will probably require drastic technological leaps. Instead of reducing the amount of tantalum used in capacitors, or indium in LCD displays, we will probably have to discover completely different ways of storing energy or displaying images. My money’s on graphene.

Neodymium shortages will cause a conflict between the US and China – shapes relations and geopolitical landscape of AsiaLeithead, BBC News reporter, 11 [Alastair, July 12, 2011, BBC, “Rare Earth Elements May Affect Future Global Relations”, http://www.bbc.co.uk/news/world-us-canada-14114107, KB]Wars have been fought over oil and water. But are the future global tensions going to be over access to Scandium, Neodymium or Dysprosium? Or could conflicts be fought over any other of the 17 rare earth elements, which, week by week, are becoming more and more important in developing the latest high-tech products? Tucked onto the periodic table of the elements, in a

little section once ignored by chemistry teachers, rare earths are now everywhere. They are in your iPod or tablet computer, are vital for the red colour in your TV screen whatever make you have and allow your headphones to be small enough to fit into your ears. Continue reading the main story “ Start Quote As China's exports are being restricted, we are looking at outright shortages of rare earths, probably this year and next” Jim Sims Molycorp representative They are in hybrid cars - both in the batteries and the fuel - and in new generation wind turbines, missile defence systems, solar panels and even F-16 fighter jets. At the moment China provides 97% of the world's rare earth elements, which is making America nervous from both an economic and a security perspective. Their price has gone up 1000% in just a year, which is making mining them in the US worthwhile once again. 'Rare earth shortages' A deep hole in the ground high up in the Mojave Desert is America's only rare earths mine, and the race is on to dig out the supply to match the demand as only a few places in the world have enough reserves to make mining them practical. "The world - America, Britain, everyone - relies on what China exports to meet their needs," says Jim Sims from Molycorp, the company running California's Mountain Pass mine. "As China's exports are being restricted, we are looking at outright shortages of rare earths, probably this year and next," he adds. America's only rare earths mine is located in the Mojave Desert in the US south-west So the huge diggers and trucks moving vast volumes of rocks around, the daily explosive charges blasting the mountainside apart, are harvesting one of the world's biggest deposits. The mine closed down 10 years ago when a flood of cheap Chinese rare earth elements made profits hard to maintain. Until just a few weeks ago, Molycorp was asking for the US government's help to cover costs of digging these elements out, separating them off and moulding them into metal alloys. But the price has gone up so rapidly, rare earths is suddenly looking like a good business. Last year China's exports of rare earth elements to Japan were interrupted during a political row over territorial waters, which sent shudders around the world. "We should be worried when any country completely dominates any raw material supplies," says Christine Parthemore, from the Center for New American Security in Washington DC. "I don't think China is uniquely at fault in this situation, but they are using the political leverage that's derived from cornering the market they have as any country would. "I'm sure America would do the same," he adds. Increasing demand The creation of permanent magnets, a key component in so many green technologies, is one of the key uses of rare earths. They make the new generation of wind turbines more efficient and reliable. But there are such an increasing variety of uses for these elements, down to glass polishing, that there aren't enough of the raw materials to go around. The speed of China's growth means the country is consuming more of its own rare earths, which has led to a drop in the amount available for export. "It is a security issue strictly in the sense that these minerals are used in critical military components for their properties, which we don't currently have substitutes for," says Christine Parthemore. "If the prices go way up or there are actual supply shortages, it can drive prices up over the long term on military procurement - or it can mean there are parts that we can't manufacture here in the United States anymore." It increases the need for an industry to extract the ore and process the materials. "The elements are all mixed together in the ore we mine," Jim Sims says. "We turn them into a liquid, and let these elements settle out into oxides which are like powders," he adds. Inside a warehouse at the mine are dozens of huge white sacks, each weighing a metric tonne and each worth $200,000 (£125,700). "Those powders then get turned into metals as magnets or used in their oxide forms for a variety of

uses in a variety of different substances," Mr Sims says. As new uses are found for materials like rare earth elements, there will be more competition, and access to them may change the shape of global politics.

AT: China Monopoly CollapseNo China monopoly collapse – refinement still has to happen in ChinaLifton, writer for Investor Intel, 14

[Jack, 1/12/14, Investor Intel, “Jack Lifton refutes WSJ article: ‘How the Great Rare-Earth Metals Crisis Vanished’,” http://investorintel.com/rare-earth-intel/jack-lifton-refutes-wsj-article-great-rare-earth-metals-crisis-vanished/, accessed 7/19/14, TYBG]

The WSJ article published on January 8, 2014 How the Great Rare-Earth Metals Crisis Vanished declares that the “rare earth crisis” is over, and as support refers to the conclusions of a “leaked” Pentagon report. It glibly declares, analyses, and dismisses, as a failure, a Chinese plot to maintain control of the production and pricing of the rare earths as having been defeated by the forces of the market and capitalism. But the real crisis is that western end-users of rare earth enabled components have proved that if you don’t capitalize the security of supply then when the market turns in your favor you are unprepared to take advantage of it. It is in the naked greed of the stock market where the real rare earth crisis was invented, fomented, sucked dry — and forgotten. The stock market flies no national flag and its players care little for apple pie or mom. Notwithstanding what this author states there is today no nation other than China that has in place a total domestic rare earth supply chain. Thus even if you do produce rare earths outside of China you must send them to China if you want to first refine mining concentrates and then to fabricate rare earth metals and alloys for use, for example, as magnets. In particular none whatsoever today of the “critical” heavy rare earths are produced outside of China.

Uniqueness

NeodymiumNeodymium supplies for wind energy are limited – but demand will continue to increaseCho, analyst and reporter for Phys.org, 12[Renee, September 20, 2012, Phys.org, “Rare earth metals: Will we have enough?", phys.org/news/2012-09-rare-earth-metals.html]"To provide most of our power through renewables would take hundreds of times the amount of rare earth metals that we are mining today," said Thomas Graedel, Clifton R. Musser Professor of Industrial Ecology and professor of geology and geophysics at the Yale School of Forestry & Environmental Studies. There is no firm definition of rare earth metals, but the term generally refers to metals used in small quantities. Rare earth metals include: rare earth elements—17 elements in the periodic table, the 15 lanthanides plus scandium and yttrium; six platinum group elements; and other byproduct metals that occur in copper, gold, uranium, phosphates, iron or zinc ores. While many rare earth metals are actually quite common, they are seldom found in sufficient amounts to be extracted economically. According to a recent Congressional Research Service report, world demand for rare earth metals is estimated to be 136,000 tons per year, and projected to rise to at least 185,000 tons annually by 2015. With continued global growth of the middle class, especially in China, India and Africa, demand will continue to grow. High-tech products and renewable energy technology cannot function without rare earth metals. Neodymium, terbium and dysprosium are essential ingredients in the magnets of wind turbines and computer hard drives; a number of rare earth metals are used in nickel-metal-hydride rechargeable batteries that power electric vehicles and many other products; yttrium is necessary for color TVs, fuel cells and fluorescent lamps; europium is a component of compact fluorescent bulbs and TV and iPhone screens; cerium and lanthanum are used in catalytic converters; platinum group metals are needed as catalysts in fuel cell technology; and other rare earth metals are essential for solar cells, cell phones, computer chips, medical imaging, jet engines, defense technology, and much more. Ads by Google Donate Car to Make-A-Wish - Donate Your Car to Help NC Kids Free Towing & Maximum Tax Deduction - WheelsForWishes.org/Make-A-Wish Wind power has grown around 7 percent a year, increasing by a factor of 10 over the last decade, noted Peter Kelemen, Arthur D. Storke Memorial Professor of Geochemistry at the Earth Institute's Lamont-Doherty Earth Observatory. "Every megawatt of electricity needs 200 kilograms of neodymium—or 20 percent of one ton," he said. "So if every big wind turbine produces one megawatt, five turbines will require one ton of neodymium. If wind is going to play a major part in replacing fossil fuels, we will need to increase our supply of neodymium ." A recent MIT study projected that neodymium demand could grow by as much as 700 percent over the next 25 years; demand for dysprosium, also needed for wind turbines, could increase by 2,600 percent. China currently supplies 97 percent of global rare earth metal demand, and 100 percent of heavy rare earth metals such as terbium and dysprosium, used in wind turbines. In 2005, it began restricting exports to preserve resources and protect the environment, causing prices to soar. Today, the United States is 100 percent dependent on imports for rare earth metals . From the mid-1960s through the 1980s, however, Molycorp's Mountain Pass mine in California was the world's main source of rare earth metals. As the U.S. share of rare earth metal production declined, China used government

support, research and development, training programs, cheap labor and low prices to develop its supply chain, increasing its share of rare earth metal production from 27 percent in 1990 to 97 percent in 2011. In March, the U.S., Japan and the European Union lodged a complaint with the World Trade Organization over China's limits on rare earth exports. In response, China announced that it will export 30,996 more metric tons of rare earth metals in 2012 than it did in 2011.

DysprosiumPrices are low—less production and export quotasMining.com 2013

[Frik Els, 1/8/13, Mining.com, “China’s 2013 rare earth production, export caps can’t stop prices diving,” http://www.mining.com/chinas-2013-rare-earth-output-export-caps-cant-stop-prices-falling-87874/, 7/19/14, IC]

China is responsible for more than 95% of the global supply of rare earths and over the weekend the country's Ministry of Land and Resources (MLR), announced that the first production quota for rare earths this year will be set at 46,900 tonnes.

Another quota will be announced later this year and the allotment is broadly in line with recent output caps.

2012 output has not been disclosed, but the production quota totaled 93,800 tonnes in 2011,according to Bloomberg. The MLR also set production for tungsten concentrate at 43,500 tonnes and antimony at 37,680 tonnes.

In December China pegged 6-month export quotas at 15,501 tonnes, also broadly in line with the 2012 figure.

The export quotas – which Japan and the US took all the way to the World Trade Organization dispute resolution body – appears to have become a meaningless exercise.

China only exported some 13,000 tonnes of rare earths through authorized channels during the whole of last year, a mere 40% of the allowed export.

A crackdown on illegal mining, consolidation of the industry under a few large producers, mothballing mines – China's number one producer recently decided to extend its production halt to three months – and the quotas have not helped to put a floor under REE prices which have continued to fall from 2011's stratospheric levels.

The value of many of the 17 elements used in a variety of industries including green technology, defence systems and consumer electronics are down more than 80%.

While mid-2012 prices looked as if it will begin to stabilize, values continue to soften.

Abundant, less valuable REEs have experienced the sharpest reversals.

Lanthanum oxide – used in ceramics and fuel catalysts – for example rose from a price of just $8.71/kg in 2008 to average $117/kg in the third quarter of 2011. By the third quarter of 2012 it was down to $19.54/kg.

As of 7 January 2013 it’s fallen further to $11/kg. Inside China that same kilogram costs $7.54.

This price behaviour can be seen across the board: cerium oxide, used to polish TV screens and lenses, is trading at $12 from an all-time high of $118 in the September 2011 quarter. In 2008 the price for cerium oxide was $4.56.

Praseodymium, used as an alloy in aircraft engines and welder goggles, was available from China in 2009 for $18/kg. After peaking in the second half of 2011 along with all the other rare earths it was still priced at $163/kg during the first quarter of 2012. Monday's benchmark price was $85, down from $105 last September.

The price of a kilogram of samarium oxide increased dramatically from a mere $3.40/kg in 2009 to average $103/kg in 2011. Used in jet fighter electrical systems among other applications, samarium actually increased in value from the first to the second quarter of 2012, from $73/kg to $82/kg.

Now it has plummeted to $25/kg free-on-board while the domestic price in China is only $7.70 for samarium.

Heavy, scarcer REEs have generally held up better, but some have experienced price declines of more than 50%.

Neodymium oxides, used in windmills, continue to slump – from $338/kg in Q3 2011 to $105.31/kg in Q3 2012 to $80/kg today.

A hybrid vehicle ingredient, dysprosium, rocketed from a price of $118.49/kg in 2008 to average $1,449/kg in 2011. It peaked at an astonishing $2,300 by September of that year.

Dysprosium, also used in conjunction with vanadium and other elements in making laser materials, has now given up more than $1,500 per kilogram and now goes for $630/kg. Inside China it is worth only $385/kg.

Dysprosium prices are low—consumers lack confidence in the marketTop Mag 2013

[10/14/13, Top Mag, “Dysprosium oxide prices on the decrease,” http://www.topmag.net/NEWS/20131014/67.html, 7/19/14, IC]

BEIJING (Asian Metal) 14 Oct 13 - Some suppliers lower dysprosium oxide offers slightly to promote deals at present, but few of consumers plan to place orders at current price levels.

A source from a separation plant whose production volume is 4tpm in South China claimed that they received rare inquiries for dysprosium oxide in October. They lower their quotation a bit to RMB2,000/kg (USD327/kg) now, down by around RMB50/kg (USD8/kg) from that of last week.

The source disclosed that end users lack confidence in current market, so they delay purchasing the material further.

A source from a smelter in South China confirmed that dysprosium oxide market remains soft with the mainstream prices hovering at RMB1,900-2,100/kg (USD310-343/kg) at present, down slightly from those of last week. As they still have enough stocks in hand, they are not in a hurry to rebuild stocks in the near term.

Dysprosium prices are down 12.2%Metal Miner 2013

[1/8/13, “Rare Earths Prices Still Dropping: Dysprosium Oxide Falls 12.2% Over Week,” http://agmetalminer.com/2013/01/08/rare-earths-prices-still-dropping-dysprosium-oxide-falls-12-2-over-week/, 7/19/14, IC]

This past week, dysprosium oxide dropped 12.2 percent on the weekly Rare Earths MMI®, making it the week’s biggest mover. Terbium oxide saw a 6.7 percent drop-off this week. The price of praseodymium oxide also decreased, down 6.1 percent from the previous week.

Dysprosium demands and pricing low nowZhejiang and Dongyang, Magnet manufacturers and administrators of Asian coal and rare earth mining , 14

(3-8-14, Strong Magnet News, “Rare Earth prices stable or volatile week”, http://www.strong-magnet.com/en/news/newsinfo.asp?id=76, accessed 7-19-14, YLP)

Rare steady this week, a slight downward market as a whole , the market demand seems to be rather dull , turnover is not lively enough , manufacturers , traders shipped positive attitude . This week lanthanum, cerium products is not much change in the basic price , 4N lanthanum oxide is currently quoted by traders Ganzhou , was 24,000 yuan / ton, Baotou manufacturers said lanthanum metal price is currently at 50,000 yuan / ton the following low. 3N5 ceria currently with votes 2.2-2.3 million / ton, nearly a week of inquiries scarce. Relatively light rare earth lanthanum, cerium , europium oxide ionic rare earth oxide , terbium oxide prices are low volatility, there is not enough momentum . Currently , according to Ganzhou businesses that europium oxide with tickets currently about 4200 yuan / kg , lower prices even in 4100 yuan / kg , with no votes at 3,450 yuan / kg. Terbium oxide without a ticket around 2850 yuan / kg , with votes in the 3200-3350 yuan / kg. This week the price changes as well as praseodymium , neodymium , dysprosium, gadolinium products. Praseodymium neodymium metal prices this week lowered its 5,000 -1.5 million / ton, praseodymium , neodymium oxide prices fell also 10,000 yuan / ton , despite the current relatively high prices of both have declined in February , compared with last year but or slightly higher than , and from country to actively promote new energy vehicles standpoint, praseodymium , neodymium metal although the latter may have dropped , but the price declines will not be too big , nor too fast fluctuations. This week's transaction price of dysprosium oxide basically down to 180 yuan / ton or less , merchants offer flat or down in the range of about 50,000 yuan / ton , demand a lot of deserted , nearly a week Measure the volume of small business procurement . Dysprosium iron and metal dysprosium have different ranges of price decline . Other oxides , such as erbium oxide , neodymium oxide , etc., about five thousand dollars a

smooth or changes / ton price , the latter temporarily vendors have expressed positive expectations too high , most stable based. According to Ganzhou manufacturers now reflect the needs of holmium products rarely yield less . No significant market turnaround , short-term demand for the release was not much room . Holmium oxide with ticket prices currently at around 420,000 yuan / ton, the business purchases of more than 1 ton.

Dysprosium prices low nowRare Earth News 13

(Rare Earth News, 12-06-13, China Tungsten, “Heavy rare earth dysprosium oxide prices hit a four-month low”, http://news.chinatungsten.com/en/rare-earth-news/35758-ren-1314, accessed 7-19-14, YLP)

Due to the rare earth reserve, hitting hot markets such concern is not up to the expected delay, the severity of the rare earth oxide, praseodymium , neodymium , dysprosium oxide prices gradually lower , data showed that the average price of dysprosium oxide is currently about 175 yuan / ton, compared with the high point in August has fell 27.8 percent , a record low in four months , analysts said the current transaction deserted , rare earth prices still further downward trend .Separation of rare earth enterprises have ceased production or help to protect the price.Minmetals Rare Earth the 5th evening announcement shows that its subsidiaries have completed mandatory production plan in 2013 , recently stopped production . It is understood that the downstream market is quiet and private crack down on rare earth mine, back in September and October, most of Ganzhou Rare Earth separation plant and other places have been cut, analysts said Minmetals other formal enterprises stop production of rare earth production is a normal phenomenon, rare earth prices have no direct impact on the end .Another rare earth analyst on condition of anonymity said, "because it is late, many rare earth companies to return the funds to clear inventory , prices have continued to fall still possible , but limited downstream demand , volume or difficult to improve , the decline should not be too great . "To delay purchasing and storage, short-term market untold.Analysts said the short-term rare earth -related companies are still expected to benefit from the national reserve, purchasing and storage once opened, should also have short-term market broke out, but the state purchasing and storage is turned on , it is still not sure, great wisdom news agency associations and business people also were not to receive messages.Analysts believe that the medium and long term, the relevant listed company is expected to continue to benefit from the country 's rare earth industry consolidation. It is understood by the Ministry led Rare large group program has been submitted to the State , once the program is approved rare large group formation is expected to officially start after the Deputy Minister of Industry and Su Bo also said publicly that the formation of rare large group program is expected before the end of baked , in order to better improve industry concentration, production quotas , mandatory plan , the new mining permits and other policies in general will be inclined to a large group in the future. But the big news is not yet definite group integration.

REMsDemand for rare earth elements are increasing – but supply issues result in global price shocksIHS, global information company, 13[Information Handling Service, June 3, 2013, “Pricing Instability, Growing Demand and Supply Fears Drive Rare Earth Industry as China Dominates Market, Says IHS Study”, http://press.ihs.com/press-release/country-industry-forecasting-media/pricing-instability-growing-demand-and-supply-fears, KB]According to a new IHS Chemical (NYSE: IHS) global market research report, a growing global dependence upon a multitude of diverse technologies—including computers, smart phones, TVs, lighting systems, hybrid automobiles, life-saving medical technologies, offshore wind turbines, petroleum refining, microwave communications and laser-guided missile defense systems -- has left manufacturers and countries vulnerable to the availability and uninterrupted supply (largely from China) of some key elements used to produce these technologies, called rare earths. In the report, the IHS Chemical Rare Earth Minerals and Products Report, production and consumption of these industrial minerals in 2012 was more than 100 thousand metric tons (KMT). During the study period of 2012 to 2017, IHS estimates average global demand for rare earth products will grow by 7.6 percent annually, reaching more than 150 KMT of consumption, with China leading consumption growth at 8.3 percent annually. Rare earths are a set of 17 chemical elements in the periodic table, more specifically, the 15 lanthanides, plus scandium and yttrium, which share similar chemical properties. Despite their name, rare earth elements are fairly abundant. The challenge for manufacturers and countries dependent upon these minerals though, is two-fold. First, they generally occur naturally as mixtures of various rare earth elements and are not always found in economically exploitable concentrations. Second, the minerals must be mined, then concentrated into rare earth oxides, and finally, separated into individual rare earth elements and compounds. A major proportion of the world’s rare earth reserves are located in China – the production and consumption of rare earths is dominated by China. China alone accounted for more than 85 percent of world rare earth production in 2012, and consumed approximately 70 percent. In terms of consumption, Japan followed with approximately 15 percent of world production in 2012, but has no domestic rare earth reserves. This imbalance creates an uncomfortable dependence for Japan and other countries requiring both a steady supply of these elements and pricing stability. Recently, these issues came to a head in a dramatic way according to Samantha Wietlisbach, principal analyst of specialty chemicals at IHS Chemical and the report’s lead author. “Supply disruptions over the last few years interrupted Japanese automotive and electronics industry production and sent shock waves through the global manufacturing industries that rely on rare earths,” Wietlisbach said “Other governments have realized their national security interests and industrial sectors were vulnerable, since China dominates the market in terms of both supply and demand,” she said. “The supply shortages also resulted in unprecedented price spikes, impacting global consumers of these materials. It was a wake-up call to address diversity of supply and to explore possible substitutions. This, in turn, has led to many new mining projects being announced globally, with rare earth ore as the main product.”

REM prices and supply are stable now- our evidence is predictiveEditorial Staff from the Magnetics Business and Technology 4-7-14’

(“Global Market for Permanent Magnets to Reach $15 Billion by 2018”, http://www.magneticsmagazine.com/main/news/global-market-for-permanent-magnets-to-reach-15-billion-by-2018/, accessed 7/19/14, LLM)

With the heavy reliance on Neodymium magnets in manufacturing, rare earth (RE) materials neodymium and dysprosium are playing a very important role because of the scarcity of these materials and the dominance of a single country (China) in providing them. The permanent magnet industry will start to see the end of serious RE shortages as new supplies begin to hit the market during 2014 and beyond, with new designs and new materials. Applications related to permanent magnet direct current motors, brushless direct current (BLDC) and brush-type (PMDC), and power generation will be the largest usage segment of neodymium-iron-boron (NdFeB) permanent magnets, followed by voice coil motors (VCMs) in disk drives, because of the need for reduced size and higher performance. The third major usage segment is hybrid and electric automotive drives. Several rare earth (RE) elements are essential ingredients in the highest performance magnets available in the world today; these magnets have enabled miniaturization and a significant increase in power density in hundreds of applications. The market experienced a boom in 2011, due to increased demand for RE permanent magnets. But as demand increased, supply chain interruptions resulted in a scarcity of RE permanent magnets. This affected the market adversely, and it plunged in 2012. As the supply of REs became stable, the market became stable, and it is expected to further stabilize in the future . This stabilization is predicted because of a reduction in the amount of dysprosium content in Neo magnets as well as a marked improvement in overall magnetic properties of ferrite magnets. Globally, many other countries have also started mining RE oxides in order to reduce dependence on China. These initiatives and efforts of Western governments are expected to bear fruit in the next five to 10 years. -

AT: Wind NowStatus quo can’t trigger the link -- no increase in wind energyJackson, award-winning columnist at the Boston Globe, 12 [Derrick, “Wistful hopes for US offshore wind energy”, Boston Globe, http://www.bostonglobe.com/opinion/2012/12/29/wistful-hopes-for-offshore-wind-energy/npbaIxVU4sAcnKSlnd3QRP/story.html, KB]DESPITE ITS promise, the American wind industry is caught in the crosswinds of American politics — and that uncertain situation set up a surreal contrast when wind enterprises gathered here to tout their technologies. The American Wind Energy Association’s conference exhibition hall was full of European and multinational firms that are busy plunging scores of turbines into their waters. German developers talked about how the industry has transformed rusting homeland harbors into bustling ports, while British officials boasted that industry investment in offshore wind will leap from $8 billion in the last decade to $80 billion in the next eight years. Representatives of American firms could only watch wistfully and wish the US government cared as much about wind energy as Europe does. Peter Duclos and Tim McAuliffe were two of those wistful watchers. Gladding-Hearn, their Somerset, Mass., company, specializes in ferries, patrol boats, pilot boats, and tugboats. They want to make boats to transport workers and equipment out to turbines. “Some people estimate that for every 10 to 15 turbines, you need a vessel to get the technicians out there,” said Duclos, the company’s president. “And every active shipyard means other companies making more piping, electronics, even more business at the local liquor store.” If the East Coast had a thriving offshore-wind industry, the ship-building company could double its current workforce of 100, added McAuliffe, the company’s engineering liaison. “We could support 200 if we cranked up a second shift,” he said. “Those kind of boats are $3 million apiece. We make five or six boats a year, but we could turn out one a month. It’ll probably never happen that way, but that could be $36 million a year.” Whether that happens all depends on politics, as does the fate of the American wind industry itself. The Department of Energy estimates that the potential power generation of offshore wind is approximately four times the capacity of the current US electric-power system.

AT: WTO RulingChina won’t follow the WTO rulingRevolve, sustainability news source, 13[1/1/13, Revolve, “Rare Earth: Chinese Shadows on “Green” Growth,” http://www.revolve-magazine.com/home/2013/01/01/rare-earth-chinese-shadows-on-green-growth/, accessed 7/19/14, TYBG]As the almost exclusive worldwide producer (97%), China has become increasingly, following its skyrocketing growth, the main consumer of rare earths. As domestic demand develops, the country reduces its exportation quotas. In 2006, China exported 61,560 tons of rare earths of the 86,520 tons officially produced, or more than 70%. In 2011, 93,800 tons were officially produced, but the Chinese government had set the exportation quotas at 30,246 tons, barely 32%! The consequence: prices increased tenfold between January 2010 and January 2011.Confronted by these exponential and severe exportation restrictions imposed by China, the European Union, Japan and the United States – who, combined, use over 90% of Chinese rare earth exportations – decided in March 2012 to register a joint complaint with the World Trade Organization (WTO). In July 2012, with no agreement in sight, the WTO litigation body established a “working group” that has six months to submit a series of recommendations that China would be obliged to respect.These will be difficult to enforce given that China has some solid arguments in its favor. First, it justifies its quota policy by the necessity to eliminate illegal mines which, according to the United States Geological Service, accounted for 17-36% of total Chinese production between 2006 and 2011. From China’s perspective, the eradication of illegal mines is indispensable for the preservation of their resources, which depends on reinforcing public oligopolies, but also on reducing overall production. However, as a strong emerging economy, China has to maintain its own supply and make decisions to determine strategic stocks for the most critical rare earths.The first adjustment variable was naturally to adjust exportation quotas. The second argument justifying exportation quotas is far more devious. Heavily criticized for the catastrophic management of the environmental consequences of the extraction process, China claims it wants to support a “sustainability” principle in managing its rare earth resources.

AT: Supply InfluxNo new supply influx for rare-earth metals – no mines will be ready soon enough Adams, Editor of Natural News Online, 10 [Mike, Natural News, “Global Supply of Rare Earth Elements Could be Wiped out by 2012”, http://www.naturalnews.com/028028_rare_earth_elements_mining.html, KB]China isn't the only geographic region where these rare earth elements are found, but constructing mines to pull these elements out of the ground takes many years. Some mines are under construction right now in other countries that could help fill the demand for REEs, but making them operational is "five to ten years away," says Lifton. That means these other mines won't really be operational until 2015 - 2020. Meanwhile, China could cut off its supply in 2012. That leaves a 3-7 year gap in which these rare earth elements will be in disastrously short supply. This brings up a couple of very important realizations related to investments:

Links

Link – Green Tech (General)The plan uniquely triggers the link – status quo supply is keeping up with demand - an unexpected surge in alternatives demand will outstrip supply Yahoo Finance, 12 [3/12/12, "Rare Earth ETF Revocers on Improved Demand," finance.yahoo.com/news/rare-earth-etf-recovers-improved-190001151.html]“Economic turmoil in the U.S. and Europe has hurt rare-earth stocks, like other mining stocks,” Anthony Young, an analyst with Dahlman Rose & Co., said in a Wall Street Journal article. “But I remain extremely bullish on the rare-earths sector over the next three to five years. Whether prices for these materials increase or decline, demand is going to remain extremely strong.” Current world demand for rare earths is estimated at 136,000 metric tons per year and meeting supply levels, but industry expert Marc Humphries of the U.S. Congressional Research Service expects global demand to increase to 185,000 tons by 2015 and cross 200,000 tons by 2020. Additionally, Dr. Randolph E. Kirchain believes that advancements in green technology to reduce greenhouse gas emissions will also require huge supplies of rare earths, reports Esther Tanquintic-Misa for the International Buisness Times. “To meet that need, production of dysprosium would have to grow each year at nearly twice the historic growth rate for rare earth supplies,” Kirchain said. “Although the rare earths supply base has demonstrated an impressive ability to expand over recent history, even the rare earths industry may struggle to keep up with that pace of demand growth.”

Link – WindUnique link – Critical rare earth supplies necessary for wind are limited now but demand is keeping pace – the plan causes massive bottlenecks and price spikes -we are 100% dependent on ChinaCho, analyst and reporter for Phys.org, 12 [Renee, 9/20/12, "Rare earth metals: Will we have enough?,"phys.org/news/2012-09-rare-earth-metals.html]"To provide most of our power through renewables would take hundreds of times the amount of rare earth metals that we are mining today," said Thomas Graedel, Clifton R. Musser Professor of Industrial Ecology and professor of geology and geophysics at the Yale School of Forestry & Environmental Studies. There is no firm definition of rare earth metals, but the term generally refers to metals used in small quantities. Rare earth metals include: rare earth elements—17 elements in the periodic table, the 15 lanthanides plus scandium and yttrium; six platinum group elements; and other byproduct metals that occur in copper, gold, uranium, phosphates, iron or zinc ores. While many rare earth metals are actually quite common, they are seldom found in sufficient amounts to be extracted economically. According to a recent Congressional Research Service report, world demand for rare earth metals is estimated to be 136,000 tons per year, and projected to rise to at least 185,000 tons annually by 2015. With continued global growth of the middle class, especially in China, India and Africa, demand will continue to grow. High-tech products and renewable energy technology cannot function without rare earth metals. Neodymium, terbium and dysprosium are essential ingredients in the magnets of wind turbines and computer hard drives; a number of rare earth metals are used in nickel-metal-hydride rechargeable batteries that power electric vehicles and many other products; yttrium is necessary for color TVs, fuel cells and fluorescent lamps; europium is a component of compact fluorescent bulbs and TV and iPhone screens; cerium and lanthanum are used in catalytic converters; platinum group metals are needed as catalysts in fuel cell technology; and other rare earth metals are essential for solar cells, cell phones, computer chips, medical imaging, jet engines, defense technology, and much more. Wind power has grown around 7 percent a year, increasing by a factor of 10 over the last decade, noted Peter Kelemen, Arthur D. Storke Memorial Professor of Geochemistry at the Earth Institute's Lamont-Doherty Earth Observatory. "Every megawatt of electricity needs 200 kilograms of neodymium—or 20 percent of one ton," he said. "So if every big wind turbine produces one megawatt, five turbines will require one ton of neodymium. If wind is going to play a major part in replacing fossil fuels, we will need to increase our supply of neodymium." A recent MIT study projected that neodymium demand could grow by as much as 700 percent over the next 25 years; demand for dysprosium, also needed for wind turbines, could increase by 2,600 percent. China currently supplies 97 percent of global rare earth metal demand, and 100 percent of heavy rare earth metals such as terbium and dysprosium, used in wind turbines. In 2005, it began restricting exports to preserve resources and protect the environment, causing prices to soar. Today, the United States is 100 percent dependent on imports for rare earth metals. From the mid-1960s through the 1980s, however, Molycorp's Mountain Pass mine in California was the world's main source of rare earth metals. As the U.S. share of rare earth metal production declined, China used government support, research and development, training programs, cheap labor and low prices to develop its supply chain, increasing its share of rare earth metal production from 27 percent in 1990 to 97 percent in 2011. In March, the U.S., Japan and the European Union lodged a complaint with the World Trade Organization over China's limits on rare earth exports. In

response, China announced that it will export 30,996 more metric tons of rare earth metals in 2012 than it did in 2011.And, no turns or thumpers – only government incentives for wind production trigger the link – best studies proveGreen Car Congress, renewable energy news source, 12 [Report based on MIT Research, 3/9/12, GCG, "MIT study finds shift to green energy sources could mean crunch in supply of key rare earth elements," www.greencarcongress.com/2012/03/ree-20120309.html]A large-scale shift from coal-fired electric power plants and gasoline-fueled cars to wind turbines and electric vehicles could increase demand for two already-scarce rare earth elements (REE)—dysprosium and neodymium, available almost exclusively in China—by 600-2,600 percent over the next 25 years, according to a new study published in the ACS journal Environmental Science & Technology. The study by researchers at MIT also points out that production of the two metals has been increasing by only a few percentage points per year. ...the availability of REEs appears to be at risk based on a number of factors. Of particular significance, one country (China) controls 98% of current supply (production). Historically, much lower levels of market concentration have harmed manufacturing firms. For example, in 1978 Zaire controlled 48% of the cobalt supply and yet political unrest in Zaire resulted in a disruption to global supply that became known as the “Cobalt Crisis”. Another contributor to supply risk for REEs is the fact that they are comined; individual REEs are not mined separately. REEs are found together in geological deposits, rendering mining of individual elements economically inefficient. The supply of any individual REE depends on the geology of the deposits, the costs of the extraction technology employed, and the price of the basket of rare earths (RE). Finally, REEs have come under global scrutiny due to the environmental and social conditions under which they are mined, further increasing their supply risk. —Alonso et al. While the literature contains a number of reports that evaluate different aspects of RE availability, Randolph E. Kirchain, Ph.D., and colleagues evaluated future potential demand scenarios for REEs with a focus on the issue of comining. They analyzed the supply of lanthanum, cerium, praseodymium, neodymium, samarium, europium, gadolinium, terbium, dysprosium and yttrium under various scenarios, and projected the demand for these 10 rare earth elements through 2035. In particular, they estimated resource requirements for electric vehicles and windturbines (revolutionary demand areas for REEs) from performance specifications and vehicle sales or turbine deployment projections. Future demand was estimated for a range of scenarios including one developed by the International Energy Agency (IEA) with adoption of electric vehicles and wind turbines at a rate consistent with stabilization of CO2 in the atmosphere at a level of 450 ppm. In one scenario, demand for dysprosium and neodymium could be higher than 2,600 and 700 percent respectively. To meet that need, production of dysprosium would have to grow each year at nearly twice the historic growth rate for rare earth supplies. The applications that will be most negatively affected by constraints in these REEs (i.e., increased costs) will be those dependent upon high performance magnets. Applications such as petroleum refining, which depend on elements whose supply is projected to exceed demand, may be positively affected if primary producers increase overall production to meet the higher demand for specific elements. If a secondary market emerges to meet the higher demand for specific elements (i.e., recycling of magnets, but not catalysts), then, given that the portfolio of recycled REEs would be significantly different from the portfolio of primary supply, the overall supply portfolio of REEs could change. ...In the end, prices are not the only forces that will influence the REE markets. Government intervention in this market is prevalent. Also, corporate social responsibility

policies may influence some firm’s decisions to use REE unless environmental concerns around their mining are addressed. These issues should be considered carefully by interested stakeholders and future research on this topic. Government mandates and incentives for renewables massively increase rare earth demand – especially for solar and wind The Obama administration has touted solar panel manufacturing as a green-job growth sector. Production of photovoltaic cells for solar panels relies on tellurium. However, the world’s only tellurium mine is in China. Tellurium is also produced as a by-product of copper purification, and a number of countries produce limited quantities this way. However, the decline in U.S. lead mining and movement to lower grades of copper ore, which require a different refining process, has reduced domestic tellurium recovery. Demand has also increased due to government green energy subsidies and mandates to increase their use. As a result, imports of tellurium have soared along with its price. The U.S. Geological Survey notes that the price of tellurium increased 14-fold between 2002 and 2006.3 From 2003 to 2007 China supplied 13 percent of U.S. tellurium imports. However, by September 2010 China’s share of imports had grown to 43 percent and it is currently the single largest source of imported tellurium.4 China’s share of world tellurium production will likely grow since it has also become the world’s largest copper consumer and refiner. In 2009, China used approximately 40 percent of the world’s copper production. China now is the world’s largest purifier of tellurium from copper, lead and other ores where it is found as a trace element. China’s near monopoly has made it virtually impossible for American solar power companies to compete with Chinese-owned firms. For instance, according to Manufacturing and Technology News [see Figure I]:5 In 2003, China produced only 1 percent of the world’s solar panels but by 2009 its share had grown to 38 percent. In 2003, U.S. production of solar panels accounted for 14 percent of the world total, but by 2009 the U.S. share had fallen to just 4 percent. Production in countries other than China fell from 85 percent of the world market in 2003 to 58 percent in 2009. The boom in China’s solar panel production has driven down the prices of similar U.S. products by around 50 percent, which is good for consumers in the short-run but not good for U.S. manufacturing jobs.6 Solar panel manufacturer Solyndra, Inc., for instance, despite more than $500 million in federal grants and loan guarantees, declared bankruptcy in September 2011, citing its inability to compete with cheaper Chinese solar panels.7 Currently, as Figure II shows, a number of technologies depend on rare earths. For example, neodymium and lanthanum are essential components in the newest generation of batteries used in hybrid and electric vehicles. Thus, domestic manufacture of these vehicles depends on China’s willingness to export rare earths. Wind power is also promoted as a way to decrease American energy dependence; however, as with electric cars, the magnets in wind-powered electrical generators require neodymium. General Electric, one of the leading companies developing wind energy technologies, purchases its entire supply of neodymium from China. Indeed, the U.S. Department of Energy estimates that the magnets in wind turbines and electric cars alone account for as much as 40 percent of worldwide demand.8Wind Generation saps 40% of global supplies now – an increase would be devastatingBurnett 11 (Sterling, senior fellow with the Natonal Center for Policy Analysis"Will Green Energy Make the United States Less Secure?" November 1, 2011 www.ncpa.org/pub/ib103)Wind power is also promoted as a way to decrease American energy dependence; however, as with electric cars, the magnets in wind-powered electrical generators require neodymium. General Electric, one of the leading companies developing wind energy technologies, purchases its entire supply of neodymium from China. Indeed, the U.S. Department of Energy estimates

that the magnets in wind turbines and electric cars alone account for as much as 40 percent of worldwide demand.8Rapid wind infrastructure development causes rare earth supply bottlenecks – causes price hikes and tradeoffs – best studies proveChandler, MIT News Office, 12 [David Chandler, 4/9/12, "Clearn energy could lead to scarce materials," web.mit.edu/newsoffice/2012/rare-earth-alternative-energy-0409.html]As the world moves toward greater use of low-carbon and zero-carbon energy sources, a possible bottleneck looms, according to a new MIT study: the supply of certain metals needed for key clean-energy technologies. Wind turbines, one of the fastest-growing sources of emissions-free electricity, rely on magnets that use the rare earth element neodymium. And the element dysprosium is an essential ingredient in some electric vehicles’ motors. The supply of both elements — currently imported almost exclusively from China — could face significant shortages in coming years, the research found. The study, led by a team of researchers at MIT’s Materials Systems Laboratory — postdoc Elisa Alonso PhD ’10, research scientist Richard Roth PhD ’92, senior research scientist Frank R. Field PhD ’85 and principal research scientist Randolph Kirchain PhD ’99 — has been published online in the journal Environmental Science & Technology, and will appear in print in a forthcoming issue. Three researchers from Ford Motor Company are co-authors. The study looked at 10 so-called “rare earth metals,” a group of 17 elements that have similar properties and which — despite their name — are not particularly rare at all. All 10 elements studied have some uses in high-tech equipment, in many cases in technology related to low-carbon energy. Of those 10, two are likely to face serious supply challenges in the coming years. The biggest challenge is likely to be for dysprosium: Demand could increase by 2,600 percent over the next 25 years, according to the study. Neodymium demand could increase by as much as 700 percent. Both materials have exceptional magnetic properties that make them especially well-suited to use in highly efficient, lightweight motors and batteries. A single large wind turbine (rated at about 3.5 megawatts) typically contains 600 kilograms, or about 1,300 pounds, of rare earth metals. A conventional car uses a little more than one pound of rare earth materials — mostly in small motors, such as those that run the windshield wipers — but an electric car might use nearly 10 times as much of the material in its lightweight batteries and motors. Currently, China produces 98 percent of the world’s rare earth metals, making those metals “the most geographically concentrated of any commercial-scale resource,” Kirchain says. Historically, production of these metals has increased by only a few percent each year, with the greatest spurts reaching about 12 percent annually. But much higher increases in production will be needed to meet the expected new demand, the study shows. China has about 50 percent of known reserves of rare earth metals; the United States also has significant deposits. Mining of these materials in the United States had ceased almost entirely — mostly because of environmental regulations that have increased the cost of production — but improved mining methods are making these sources usable again.

Link - SolarUnique link – Critical rare earth supplies necessary for solar are limited now but demand is keeping pace – the plan causes massive bottlenecks and price spikes -we are 100% dependent on ChinaCho, analyst and reporter for Phys.org, 12 [Renee, 9/20/12, "Rare earth metals: Will we have enough?,"phys.org/news/2012-09-rare-earth-metals.html]"To provide most of our power through renewables would take hundreds of times the amount of rare earth metals that we are mining today," said Thomas Graedel, Clifton R. Musser Professor of Industrial Ecology and professor of geology and geophysics at the Yale School of Forestry & Environmental Studies. There is no firm definition of rare earth metals, but the term generally refers to metals used in small quantities. Rare earth metals include: rare earth elements—17 elements in the periodic table, the 15 lanthanides plus scandium and yttrium; six platinum group elements; and other byproduct metals that occur in copper, gold, uranium, phosphates, iron or zinc ores. While many rare earth metals are actually quite common, they are seldom found in sufficient amounts to be extracted economically. According to a recent Congressional Research Service report, world demand for rare earth metals is estimated to be 136,000 tons per year, and projected to rise to at least 185,000 tons annually by 2015. With continued global growth of the middle class, especially in China, India and Africa, demand will continue to grow. High-tech products and renewable energy technology cannot function without rare earth metals. Neodymium, terbium and dysprosium are essential ingredients in the magnets of wind turbines and computer hard drives; a number of rare earth metals are used in nickel-metal-hydride rechargeable batteries that power electric vehicles and many other products; yttrium is necessary for color TVs, fuel cells and fluorescent lamps; europium is a component of compact fluorescent bulbs and TV and iPhone screens; cerium and lanthanum are used in catalytic converters; platinum group metals are needed as catalysts in fuel cell technology; and other rare earth metals are essential for solar cells, cell phones, computer chips, medical imaging, jet engines, defense technology, and much more. Wind power has grown around 7 percent a year, increasing by a factor of 10 over the last decade, noted Peter Kelemen, Arthur D. Storke Memorial Professor of Geochemistry at the Earth Institute's Lamont-Doherty Earth Observatory. "Every megawatt of electricity needs 200 kilograms of neodymium—or 20 percent of one ton," he said. "So if every big wind turbine produces one megawatt, five turbines will require one ton of neodymium. If wind is going to play a major part in replacing fossil fuels, we will need to increase our supply of neodymium." A recent MIT study projected that neodymium demand could grow by as much as 700 percent over the next 25 years; demand for dysprosium, also needed for wind turbines, could increase by 2,600 percent. China currently supplies 97 percent of global rare earth metal demand, and 100 percent of heavy rare earth metals such as terbium and dysprosium, used in wind turbines. In 2005, it began restricting exports to preserve resources and protect the environment, causing prices to soar. Today, the United States is 100 percent dependent on imports for rare earth metals. From the mid-1960s through the 1980s, however, Molycorp's Mountain Pass mine in California was the world's main source of rare earth metals. As the U.S. share of rare earth metal production declined, China used government support, research and development, training programs, cheap labor and low prices to develop its supply chain, increasing its share of rare earth metal production from 27 percent in 1990 to 97 percent in 2011. In March, the U.S., Japan and the European Union lodged a complaint with the World Trade Organization over China's limits on rare earth exports. In

response, China announced that it will export 30,996 more metric tons of rare earth metals in 2012 than it did in 2011.And, no turns or thumpers – only government incentives for solar production trigger the link – best studies proveGreen Car Congress, renewable energy news source, 12 [Report based on MIT Research, 3/9/12, GCG, "MIT study finds shift to green energy sources could mean crunch in supply of key rare earth elements," www.greencarcongress.com/2012/03/ree-20120309.html]A large-scale shift from coal-fired electric power plants and gasoline-fueled cars to wind turbines and electric vehicles could increase demand for two already-scarce rare earth elements (REE)—dysprosium and neodymium, available almost exclusively in China—by 600-2,600 percent over the next 25 years, according to a new study published in the ACS journal Environmental Science & Technology. The study by researchers at MIT also points out that production of the two metals has been increasing by only a few percentage points per year. ...the availability of REEs appears to be at risk based on a number of factors. Of particular significance, one country (China) controls 98% of current supply (production). Historically, much lower levels of market concentration have harmed manufacturing firms. For example, in 1978 Zaire controlled 48% of the cobalt supply and yet political unrest in Zaire resulted in a disruption to global supply that became known as the “Cobalt Crisis”. Another contributor to supply risk for REEs is the fact that they are comined; individual REEs are not mined separately. REEs are found together in geological deposits, rendering mining of individual elements economically inefficient. The supply of any individual REE depends on the geology of the deposits, the costs of the extraction technology employed, and the price of the basket of rare earths (RE). Finally, REEs have come under global scrutiny due to the environmental and social conditions under which they are mined, further increasing their supply risk. —Alonso et al. While the literature contains a number of reports that evaluate different aspects of RE availability, Randolph E. Kirchain, Ph.D., and colleagues evaluated future potential demand scenarios for REEs with a focus on the issue of comining. They analyzed the supply of lanthanum, cerium, praseodymium, neodymium, samarium, europium, gadolinium, terbium, dysprosium and yttrium under various scenarios, and projected the demand for these 10 rare earth elements through 2035. In particular, they estimated resource requirements for electric vehicles and windturbines (revolutionary demand areas for REEs) from performance specifications and vehicle sales or turbine deployment projections. Future demand was estimated for a range of scenarios including one developed by the International Energy Agency (IEA) with adoption of electric vehicles and wind turbines at a rate consistent with stabilization of CO2 in the atmosphere at a level of 450 ppm. In one scenario, demand for dysprosium and neodymium could be higher than 2,600 and 700 percent respectively. To meet that need, production of dysprosium would have to grow each year at nearly twice the historic growth rate for rare earth supplies. The applications that will be most negatively affected by constraints in these REEs (i.e., increased costs) will be those dependent upon high performance magnets. Applications such as petroleum refining, which depend on elements whose supply is projected to exceed demand, may be positively affected if primary producers increase overall production to meet the higher demand for specific elements. If a secondary market emerges to meet the higher demand for specific elements (i.e., recycling of magnets, but not catalysts), then, given that the portfolio of recycled REEs would be significantly different from the portfolio of primary supply, the overall supply portfolio of REEs could change. ...In the end, prices are not the only forces that will influence the REE markets. Government intervention in this market is prevalent. Also, corporate social responsibility

policies may influence some firm’s decisions to use REE unless environmental concerns around their mining are addressed. These issues should be considered carefully by interested stakeholders and future research on this topic. Government mandates and incentives for renewables massively increase rare earth demand – especially for solar and wind The Obama administration has touted solar panel manufacturing as a green-job growth sector. Production of photovoltaic cells for solar panels relies on tellurium. However, the world’s only tellurium mine is in China. Tellurium is also produced as a by-product of copper purification, and a number of countries produce limited quantities this way. However, the decline in U.S. lead mining and movement to lower grades of copper ore, which require a different refining process, has reduced domestic tellurium recovery. Demand has also increased due to government green energy subsidies and mandates to increase their use. As a result, imports of tellurium have soared along with its price. The U.S. Geological Survey notes that the price of tellurium increased 14-fold between 2002 and 2006.3 From 2003 to 2007 China supplied 13 percent of U.S. tellurium imports. However, by September 2010 China’s share of imports had grown to 43 percent and it is currently the single largest source of imported tellurium.4 China’s share of world tellurium production will likely grow since it has also become the world’s largest copper consumer and refiner. In 2009, China used approximately 40 percent of the world’s copper production. China now is the world’s largest purifier of tellurium from copper, lead and other ores where it is found as a trace element. China’s near monopoly has made it virtually impossible for American solar power companies to compete with Chinese-owned firms. For instance, according to Manufacturing and Technology News [see Figure I]:5 In 2003, China produced only 1 percent of the world’s solar panels but by 2009 its share had grown to 38 percent. In 2003, U.S. production of solar panels accounted for 14 percent of the world total, but by 2009 the U.S. share had fallen to just 4 percent. Production in countries other than China fell from 85 percent of the world market in 2003 to 58 percent in 2009. The boom in China’s solar panel production has driven down the prices of similar U.S. products by around 50 percent, which is good for consumers in the short-run but not good for U.S. manufacturing jobs.6 Solar panel manufacturer Solyndra, Inc., for instance, despite more than $500 million in federal grants and loan guarantees, declared bankruptcy in September 2011, citing its inability to compete with cheaper Chinese solar panels.7 Currently, as Figure II shows, a number of technologies depend on rare earths. For example, neodymium and lanthanum are essential components in the newest generation of batteries used in hybrid and electric vehicles. Thus, domestic manufacture of these vehicles depends on China’s willingness to export rare earths. Wind power is also promoted as a way to decrease American energy dependence; however, as with electric cars, the magnets in wind-powered electrical generators require neodymium. General Electric, one of the leading companies developing wind energy technologies, purchases its entire supply of neodymium from China. Indeed, the U.S. Department of Energy estimates that the magnets in wind turbines and electric cars alone account for as much as 40 percent of worldwide demand.8Solar economy requires 50% of all available supplies – causes massive bottlenecks and tradeoffs that collapse competing industries and prevent a transition to renewablesSpence, writer for EurActiv, 11 [Timothy, 11/16/11, "Rare-earth shortage to hamper clean energy: EU study," www.euractiv.com/sustainability/rare-earth-shortage-hamper-clean-news-508967]Looming shortages of metals that are in high demand and dominated by a single supplier – China – threaten Europe’s goals for cleaner transport and sustainable energy, says a new study prepared for the European Commission. The study by the Joint Research Centre says supply

shortfalls of component metals in the next two decades risk the production of solar, wind and nuclear technologies as well as electric vehicles and carbon-capture systems. “This adds more evidence to the fact that Europe has to look within itself … and more toward waste management, to re-use existing metals,” said Dr. Raymond Moss, lead author of the report. The findings could have serious implications for the EU’s “Roadmap for moving to a low-carbon economy in 2050” that hinges on development of renewable energy, cleaner transport as well as modernising and integrating Europe’s electricity grids. Such ambitions depend heavily on the availability of neodymium, dysprosium, indium, tellurium and gallium, metals that are in demand globally. EU’s vital raw materials The Commission has already identified many so-called rare-earth minerals as well as metals like cobalt in its lists of 14 economically vital raw materials that are prone to supply disruption. The JRC study is part of the Commission’s examination of raw material needs. Europe depends on imports for nearly all of its rare-earth metals. Though many are in abundant supply on the planet, the metals are dispersed or difficult to access, and despite their importance to green energy, require intensive mining and processing. China controls more than 90% of the market. In July, the World Trade Organisation called on China to ease its export restrictions on 17 rare-earth metals important to energy, transport and electronics manufacturing. Shortages or limitations on supply would have serious impact on many industries. But with solar and wind power expected to account for the biggest energy growth markets over the next 20 years, the impact on alternative energy could be profound. The JRC report says five metals - dysprosium, neodymium, tellurium, gallium, and indium - are at the highest risk of supply “bottlenecks” from high demand, concentration of supply and “high political risks due to an extreme concentration of supply in China.” The study examines 14 rare-earth metals. Solar energy technologies, for example, will require half the current world supply of tellurium and 25% of the supply of indium, the report says. Europe’s wind energy technology will require about 4% of the supply of both neodymium and dysprosium. “While the percent might be small, it could have a significant effect on wind technology,” Moss told EurActiv. The concern, he said is that “90 percent of the source is in China at the moment, and they themselves have a rapidly growing demand for the same metals whilst they have also limited restrictions on export.”Independently, REMs are key to solar development – Chinese monopoly kills the industry and destroys international cooperation on solarFinley, writer for the Denver Post, 11 [Bruce, 1/16/11, Denver Post, “China's control of rare-earth metals poses risk to U.S. solar future,” http://www.denverpost.com/ci_17108810]China's tight control of rare metals may hurt developing domestic solar industries , according to a research director at the National Renewable Energy Lab. "Folks are looking at, if we don't get it from China, how will we get it?" said Ryne Raffaele, director of the center for photovoltaics at NREL, the U.S. government's premier energy lab. "Can it easily be mined?" Scientists at NREL, west of Denver, use an array of rare metals in their research. The Chinese government's recent move to cut rare-metal exports by 35 percent and rapid growth of solar-panel manufacturing inside China also are chilling the climate for scientific cooperation. China produces 55 percent of the world's solar panels.

Link – Government Incentives

Government incentives for wind generation would hamstring global REM supplies The Economist 12 [3/17/12, "In a hole?," www.economist.com/node/21550243]MANY plans for reducing the world's emissions of carbon dioxide—at least, those plans formulated by environmentalists who are not of the hair-shirt, back-to-the-caves persuasion—involve peppering the landscape with wind turbines and replacing petrol-guzzling vehicles with electric ones charged up using energy gathered from renewable resources. The hope is that the level of CO2 in the atmosphere can thus be kept below what is widely agreed to be the upper limit for a tolerable level of global warming, 450 parts per million. Wind turbines and electric vehicles, however, both rely on dysprosium and neodymium to make the magnets that are essential to their generators and motors. These two elements, part of a group called the rare-earth metals, have unusual configurations of electrons orbiting their nuclei, and thus unusually powerful magnetic properties. Finding substitutes would be hard. Motors or generators whose magnets were made of other materials would be heavier, less efficient or both. At the moment, that is not too much of a problem. Though a lot of the supply of rare earths comes from China, whose government has recently been restricting exports (a restriction that was the subject of a challenge lodged with the World Trade Organisation by America, Europe and Japan on March 13th), other known sources could be brought into play reasonably quickly, like the Mountain Pass mine in California, pictured above, which re-opened for business in February. At current levels of demand any problem caused by the geographical concentration of supply would thus be an irritating blip rather than an existential crisis. But what if the environmentalists' dream came true? Could demand for dysprosium and neodymium then be met? That was the question Randolph Kirchain, Elisa Alonso and Frank Field, three materials scientists at the Massachusetts Institute of Technology, asked themselves recently. Their answer, just published in Environmental Science and Technology, is that if wind turbines and electric vehicles are going to fulfil the role environmental planners have assigned them in reducing emissions of carbon dioxide, using current technologies would require an increase in the supply of neodymium and dysprosium of more than 700% and 2,600% respectively during the next 25 years. At the moment, the supply of these metals is increasing by 6% a year. To match the three researchers' projections it would actually have to increase by 8% a year for neodymium and 14% for dysprosium. That will be hard, particularly for dysprosium. Incremental improvements to motors and generators might be expected to bring demand down a bit. But barring a breakthrough in magnet technology (the discovery of a room-temperature superconductor, for example) the three researchers' figures suggest that the world's geologists would do well to start scouring the planet for rare-earth ores now. If they do not, the mood of the Chinese government may be the least of the headaches faced by magnet manufacturers.

Impact/Misc

2NC – Turns CaseTurns the case - rare-earth supply bottlenecks prevent a transition and collapse the economyVidal, writer for the Guardian, 12 [John, 1/27/12, The Guardian, "Rare minerals dearth threatens global renewables industry," www.guardian.co.uk/environment/2012/jan/27/rare-minerals-global-renewables-industry]Shortages of a handful of rare minerals could slow the future growth of the burgeoning renewable energy industries, and affect countries' chances of limiting greenhouse gas emissions, business leaders were told at the World Economic Forum in Davos this week. Last year, prices of many scarce minerals exploded, rising as much as 10 times over 2010 levels before dropping back, said PricewaterhouseCoopers (PwC). Terbium, yttrium, dysprosium, europium and neodymium are widely used in the manufacture of wind turbines, solar panels, electric car batteries and energy-efficient lightbulbs. But because these "rare earths" are mined almost exclusively in China, it is becoming increasingly difficult and expensive to source them in the required quantities. In a survey of some of the largest clean energy manufacturers, 78% told PwC said they were already experiencing instability of supply of rare metals, and most said they did not expect shortages to ease for at least five years. Currently, 95% of the rare earth minerals needed by clean tech industries come from China which has set strict export quotas. Last year China reserved most for its own for its domestic wind, solar and battery industries, shifting costs to the US and Europe which do not mine any of the minerals. Scarcity of the mineral resources could affect disrupt entire supply chains and countries' attempts to meet emissions targets, said PwC. "The energy sector could face very great problems if the world turns to [renewables] in a big way. In the short term, there will be major supply problems. The availability of these metals will define the growth of these industry sectors. There are so far not many alternatives," said Rob Mathlener, author of a report that urged companies to build future strategies around recycling and reusing resources. Last December, Janez Potočnik, the EU commissioner for the environment, warned that the waste of valuable natural resources threatens to produce a fresh economic crisis. None of the minerals is likely to physically run out, but it can take 10 years for countries to open new mines. In the US there has been growing concerns that China dominates the supply of the materials considered crucial for the expansion of the US defence, computer and renewable energy sectors.Status quo REM supply growth is keeping up with global demand but supplies cannot increase fast enough to solve the aff –supply bottlenecks wreck solvencyTrujillo, researcher at the Columbia Climate Centre, 12 [Iliana Cardenes, 4/2/12, Columbia University, "Rare Earth Metals: Another Challenge for the Green Economy?," blogs.ei.columbia.edu/2012/04/02/rare-earth-metals-another-challenge-for-the-green-economy/]Historically, their rarity has not posed a problem, as there has been adequate supply to meet global demand. But questions are being raised about the future of the supply. China mines 94 to 97% of the rare earth metals globally, and while there have been increasing efforts in the US and Europe to find alternative supplies, the complex and highly polluting extraction process is proving problematic. China’s global monopoly is an increasing worry: their halt of rare earth exports to Japan in 2010 led to a 30-fold increase in the price of rare earth metals by the summer of 2011; with a subsequent plummeting of up to three fifths from that price, indicating the current volatility. Two weeks ago, the US, EU and Japan filed a formal request for

consultation with the WTO about China’s increasing restrictions on the exports of their rare earth metals. There will be a legal case in May 2012 if China does not agree to the demands. This constraint on supply is worrying for climate change because if clean technologies are to contribute significantly to the reduction of greenhouse gas emissions, then the supply of rare earth metals needs to increase with the growth in the sector. Randolph Kirchain, Elisa Alonso and Frank Field, of MIT, recently explained in Environmental Science and Technology that in order for clean technologies to contribute significantly to reducing greenhouse gases, we would require an increase of neodymium and dysprosium of over 700% and 2600% respectively in the next 25 years. The supply of these metals is currently increasing at 6% a year, and is under threat. In order to meet demand for clean technologies, the supply would have to increase by 8% and 14%.We control the brink – REM supplies are highly limited now – increased demand causes shortages for other industries dependent on rare earthVidal, writer for the Guardian, 12 [John,1/27/12, The Guardian, "Rare minerals dearth threatens global renewables industry," www.guardian.co.uk/environment/2012/jan/27/rare-minerals-global-renewables-industry]Six other core manufacturing industries, including aerospace, automotive and chemicals, were all found to be experiencing shortages. According to the US Congress report published last September, world demand for rare elements is estimated at 136,000 tonnes per year, with global production around 133,600 tonnes in 2010. It is projected to rise to at least 185,000 tonnes a year by 2015.Neodymium shortage turns the case – can’t deploy clean energy without it North American Wind Power, News Department, 11 [North American Wind Power, December 27, 2011, “DOE: Rare-Earth Supply May Threaten Wind Turbine Production”, http://www.nawindpower.com/e107_plugins/content/content.php?content.9125, KB]The U.S. Department of Energy (DOE) has released the 2011 Critical Materials Strategy - a report that examines the role that rare-earth metals and other key materials play in clean energy technologies such as wind turbines. According to the report, several clean energy technologies use materials that are at risk of supply disruptions in the short term, with risks generally decreasing in the medium and long terms. Supply challenges for five rare-earth metals - dysprosium, neodymium, terbium, europium and yttrium - may affect clean energy technology deployment in the years ahead, the DOE says. This is the DOE's second report on this topic and provides an update to last year's analysis. Using a methodology adapted from the National Academy of Sciences, the report includes criticality assessments for 16 elements based on their importance to clean energy and supply risk. The DOE’s critical materials research and development (R&D) plan is aligned with the three pillars of the DOE strategy: diversifying supply, developing substitutes and improving recycling.

AT: Ocean MiningShortages and high prices incentivize ocean mining – collapses marine ecosystemsCho, analyst and reporter for Phys.org, 12 [Renee, 9/20/12, Phys.org, "Rare earth metals: Will we have enough?," phys.org/news/2012-09-rare-earth-metals.html]Because of rising prices, there is now renewed interest in seabed mining for rare earth metals. Since the 1960s, scientists have known about the existence of manganese nodules, rocks abundant in water 4,000 to 5,000 meters deep that contain nickel, copper, cobalt, manganese and rare earth metals, but in the past, mining them never made economic sense. In 2011, a Japanese team found huge deposits of rare earth metals, including terbium and dysprosium, in sea mud 3,500 to 6,000 meters deep in the Pacific Ocean. One square kilometer (0.4 square mile) of deposits will be able to provide one-fifth of the current global annual consumption, according to Yasuhiro Kato, an associate professor of earth science at the University of Tokyo. The New York Times recently reported the discovery of deposits of gold, silver, copper, cobalt, lead and zinc in the sulfurous mounds that gush hot water from fissures near active volcanic areas on the ocean floor. Seabed mining, however, could cause great damage to fisheries and marine ecosystems, so environmentalists are pushing for more research and mitigation planning before it begins.Ocean floor mining devastates ecosystems and permanently damages massive regionsGoldenberg, environmental correspondent for The Guardian, 14 [Suzanne, 3/1/14, The Guardian, “Marine mining: Underwater gold rush sparks fears of ocean catastrophe,” http://www.theguardian.com/environment/2014/mar/02/underwater-gold-rush-marine-mining-fears-ocean-threat]This is the last frontier: the ocean floor, 4,000 metres beneath the waters of the central Pacific, where mining companies are now exploring for the rich deposits of ores needed to keep industry humming and smartphones switched on. The prospect of a race to the bottom of the ocean – a 21st-century high seas version of the Klondike gold rush – has alarmed scientists. The oceans, which make up 45% of the world's surface, are already degraded by overfishing, industrial waste, plastic debris and climate change, which is altering their chemistry. Now comes a new extractive industry – and scientists say governments are not prepared. "It's like a land grab," said Sylvia Earle, an oceanographer and explorer-in-residence for National Geographic. "It's a handful of individuals who are giving away or letting disproportionate special interests have access to large parts of the planet that just happen to be under water." The vast expanses of the central Pacific seabed being opened up for mining are still largely an unknown, she said. "What are we sacrificing by looking at the deep sea with dollar signs on the few tangible materials that we know are there? We haven't begun to truly explore the ocean before we have started aiming to exploit it." But the warnings may arrive too late. The price of metals is rising. The ore content of the nodules of copper, manganese, cobalt and rare earths strewn across the ocean floor promise to be 10 times greater than the richest seams on land, making the cost of their retrieval from the extreme depths more attractive to companies. Mining the ocean floor of the central Pacific on a commercial scale is five years away, but the

beginnings of an underwater gold rush are under way The number of companies seeking to mine beneath international waters has tripled in the last three or four years. "We have already got a gold rush, in a way," said Michael Lodge, deputy secretary general of the International Seabed Authority, which regulates the use of the sea floor in international waters. "The amount of activity has expanded exponentially." The Jamaica-based agency has granted 26 permits to date to explore an area the size of Mexico beneath the central Pacific that had been set aside for seabed mining – all but eight within the last three or four years. Britain is leading the way in a project led by Lockheed Martin, but Russia, China, Japan, and South Korea all have projects in play. This year alone, companies from Brazil, Germany and the Cook Islands have obtained permits to explore tracts of up to 75,000 sq km on the ocean floor for copper, cobalt, nickel and manganese, and the rare earth metals that help power smartphones, tablets and other devices. Other areas of the Pacific – outside international waters – are also opening up for mining. Papua New Guinea has granted permission to a Canadian firm, Nautilus Minerals, to explore a site 30km off its coast for copper, zinc and gold deposit worth potentially hundreds of millions of dollars. Lodge expects the pace to continue, with rising demand for metals for emerging economies, and for technologies such as hybrid cars and smart phones. Extracting the metals will not require drilling. The ore deposits are in nodules strewn across the rolling plains of sediment that carpet the ocean floor. Oceanographers say they resemble knobbly black potatoes, ranging in size from a couple of centimetres to 30cm. Mining companies say it may be possible to scoop them up with giant tongs and then siphon them up to vessels waiting on the surface. The problem is much remains unknown – not just about what exists on the ocean floor but how ocean systems operate to keep the planet habitable. The ocean floor was once thought to be a marine desert, but oceanographers say the sediment is rich in marine life, with thousands of species of invertebrates at a single site. "It's tampering with ecosystems we hardly understand that are really at the frontier of our knowledge base ," said Greg Stone, vice-president for Conservation International. "We are starting mining extracting operations in a place where we don't fully understand how it works yet. So that is our concern – disturbing the deep sea habitat." Most of the models rely on being able to produce 1 million tonnes of ore a year. Stone said the seabed authority was putting systems in place to protect the ocean floor, but other scientists said there still remained enormous risks to the sediment and the creatures that live there. " It is going to damage vast areas of the sea floor ," said Craig Smith, an oceanographer at the University of Hawaii who served as an adviser to the International Seabed Authority. "I just don't see any way [in] mining one of these claims that whole areas won't be heavily damaged." Earle expressed fears about how mining companies will deal with waste in the high seas. "Mining is possible," she said. "But the 20,000ft question is what do you do with the tailings? All of the proposals involved dumping the tailings at sea with profound impacts on the water column and the sea floor below. The Seabed Authority initially proposed to set aside 1.6m sq km of the ocean floor as protected areas, or about 20% of its territory. But those reserves are under review. As economic pressures rise, there are fears that commercial operations would begin to erode those protected areas. "I think it is certain that within a year or two there will be more claims covering these areas and there won't be enough room left to develop these scientifically defensible protected areas," Smith said. Some have argued that with all the unknowns there should be no mining at all – and that the high seas should remain out of bounds for mineral extraction and for shipping. José María Figueres, a former president of Costa

Rica and co-chair with the former British foreign secretary, David Miliband, of the Global Ocean Commission, an independent entity charged with developing ideas for ocean reform, suggested leaving all of the high seas as a no-go area for commercial exploitation (apart from shipping). "Do we know enough about the seabed to go ahead and mine it?" said Figueres. "Do we understand enough about the interconnection between the seabed, the column of water, the 50% of the oxygen that the ocean produces for the world, the 25% of the carbon that it fixes in order to go in and disrupt the seabed in way that we would if we went in and started mining? I don't think so, not until we have scientific backing to determine whether this is something good or bad for the planet." World leaders are now mobilising to address concerns, not just about seabed mining, but about how to safeguard ocean systems which are increasingly recognised as critical to global food security and a healthy planet. US secretary of state John Kerry, in a video address delivered to a high-level ocean summit hosted by the Economist and National Geographic last week, invited leaders to a two-day summit in Washington that will seek ways of protecting fishing stocks from overexploitation and protecting the ocean from industrial pollution, plastic debris and the ravages of climate change. The stakes have never been higher, scientists said. The oceans are becoming increasingly important to global food security. Each year more than a million commercial fishing vessels extract more than 80m metric tonnes of fish and seafood from the ocean. Up to three billion people rely on the sea for a large share of their protein, especially in the developing world. Those demands are only projected to grow. "If you look at where food security has to go between now and 2030 we have to start looking at the ocean. We have to start looking at the proteins coming from the sea," said Valerie Hickey, an environmental scientist at the World Bank. That makes it all the more crucial to crack down on illegal and unregulated fishing, which is sabotaging efforts to build sustainable seafood industries. Two-thirds of the fish taken on the high seas are from stocks that are already dangerous depleted – far more so than in those parts of the ocean that lie within 200 miles of the shore and are under direct national control. Estimates of the unreported and illegal catch on the high seas range between $10bn and $24bn a year, overwhelming government efforts to track or apprehend the illegal fishing boats. The illegal fishing also hurts responsible fishing crews. Figueres and Miliband suggested fitting all the vessels operating on the high seas with transponders to track their movements. That would single out rogue fishing vessels, making it easier for authorities to apprehend the vessels and their catch. It's not a perfect solution. A diplomat who has negotiated international agreements to control illegal fishing said captains – already cagey about revealing their favourite fishing routes – would simply flip off the transponders. United Nations officials were also sceptical of the idea of a high-seas police force. "It sounds a little bit like science fiction for me at this particular moment," said Irina Bokova, the director general of Unesco, which manages 46 marine sites. "What kind of police? Who is going to monitor? How is it founded? It's a very complicated issue." But the debate was a sign of growing momentum in an international effort to protect the oceans – before it's too late. When it comes to the ocean floor, that process is at the very early stages. But given the multiple disasters humans have made with the ocean so far, the stakes are high for getting it right. "There is no doubt there are huge mineral resources to be extracted at some point in the future," Lodge said. "It's also true we don't know enough about the impact on biodiversity and the impact on marine life once the mining takes place." As the ultimate custodian, said Michael Lodge, the International Seabed Authority had two responsibilities; making sure companies

access that vast mineral wealth in an environmentally responsible way, and then sharing it out equitably. "We have a huge challenge to devise a fiscal regime so that humankind as a whole gets a fair share. That's an enormous challenge, he said. "If we end up giving it away to industry, then we have failed in our missions." And the costs of such a failure are already becoming painfully evident in the greater ocean.

Mining isn’t sufficient – inability to refine into usable forms maintains Chinese relianceKennedy, President of Wings Enterprises, internationally recognized expert on rare earths, 14 [Jim, 1/29/14, Investor Intel, “China’s Rare Earth Monopoly and its formidable impact on U.S. National Defense,” http://investorintel.com/rare-earth-intel/chinas-rare-earth-monopoly-formidable-impact-u-s-national-defense/]U.S. mining of rare earths is pointless if it isn’t able to refine these resources into value added DoD ready commodities: China maintains a global monopoly on all refining, metallurgical, alloy and component technologie s as well as OEM and material science facilities. U.S. , Japanese, Korean and European businesses are relocating to China to secure access to these materials, including those used by National Defense. For instance, in 2013, GM established a new Technology Science Laboratory in China. As an example, a Chinese corporation was granted approval to purchase the assets of A123 battery. A123 was the centerpiece of the Obama Administration’s drive for electric vehicles. The fact that GE moved the last of its medical imaging divisions to China provides further proof. Over the last decade nearly every major multinational relying on REE’s has moved its manufacturing facilities, established subsidiaries and suppliers in China to gain access to these materials in what is a labor and technology drain that is undermining our economic future. The U.S. should establish in my opinion – a fully integrated REE refinery value chain in North America.

Mining destroys the environment – toxic leaks and carbon emissionsSims, green tech reporter for Industry Market Trends, 13 [David, 8/22/13, Thomasnet, “Rare Earths and Other Chemicals Damaging the Environmental Value of Renewables,” http://news.thomasnet.com/IMT/2013/08/22/rare-earths-and-other-chemicals-damaging-the-environmental-value-of-renewables/]Wind energy seems so clean — gentle breezes quietly spinning sleek blades, generating energy. What could be dirty about that? According to The Data Center Journal, for one, the answer is, “Plenty.” See, to get those wonderful turbines, one needs a rather large quantity of rare earth minerals (which, despite their name, are not so rare). Mining and processing these rare earths generates a tremendous amount of “hazardous and radioactive byproducts,” the DCJ reports, which “can cause tremendous harm to both people and the environment .” In fact, the environmental effects of rare earth mining can be literally sickening . In the Mongolian town of Baotou, the epicenter of Chinese rare earths production, the mining has literally killed off the local farming, The Guardian reports: “The soil and groundwater are saturated with toxic substances. Five years ago (local farmer) Li had to get rid of his sick pigs, the last survivors of a collection of cows, horses, chickens, and goats, killed off by the toxins.” The environmental damage that rare earth production requires might be one of the major reasons the U.S. is

happy to let China do most of it, and buy the finished product from them. The irony is rather hard to miss — proponents of wind power demand stringent environmental standards on our domestic coal and nuclear industry, but seem strangely unconcerned at the appalling environmental conditions necessary to supply their rare earths habit. In fact, it’s rare earths which account for a great deal of the overall carbon footprint of green energy, energy storage, and other clean technologies. The 17 so-called rare earth minerals, e.g., the lanthanides, scandium, and yttrium, as well as associated metals molybdenum and tungsten, are needed in the production of items such as cell phones, other popular consumer electronics, batteries, the electronics governing defense systems, and missiles. Production and consumption of rare earth minerals totaled over 100,000 metric tons in 2012, according to a report from IHS Chemical in Houston. IHS’s study estimates that from 2012 to 2017, global demand for rare earth products will grow by 7.6 percent annually and reach more than 150,000 metric tons, with China leading consumption growth at 8.3 percent annually. Rare Earths Not So Rare, Actually. Contrary to the term, rare earths are actually abundant — far more so than silver and gold. Australia, the U.S., and other have nations have sizable reserves. But world production is predominantly controlled by China. It’s an almost-ironic situation where carbon-intensive production and mining methods are used to manufacture products designed to lower the overall carbon footprint. Danish wind turbine producer Vestas writes on its website, “The rare earth elements are used in the magnets found in the tower and in the permanent-magnet generators in some of the newer models… to improve the performance of turbines by making the generators more efficient and more grid-compatible,” which allows for smaller generators requiring “fewer other resources (steel, composite structural materials, etc.) and a smaller carbon footprint.” Rare Earths Not So Eco-Friendly, Either. According to the online journal Ecocred, “[A]n electric car might use nearly 10 times the amount of rare earth metals as opposed to a conventional car, which uses a little more than one pound of rare earth materials.” Research conducted at MIT noted, “A single large wind turbine (rated at about 3.5 WM) typically contains 600 kg, or about 1,300 lbs, of rare earth metals.” The grim trade-off between obtaining power from wind and the methods required to make that happen leave those within the industry uncomfortable. “Executives in the $1.3 billion rare-earths mining industry say that less environmentally damaging mining is needed, given the importance of their product for green energy technologies,” The New York Times wrote back in 2009, adding that Nicholas Curtis, the executive chairman of the Lynas Corporation of Australia, in a speech to an industry gathering in Hong Kong said, “This industry wants to save the world. We can’t do it and leave a product that is glowing in the dark somewhere else, killing people.”

Aff Answers

Prices High NowNew regulations have driven the price of rare earth metals upMetalMiner IndX Reports, Company that identifies Sourcing & Trading Intelligence for Global Metals Markets, 2014

[MetalMiner IndX Reports, 01/7/14, Metal Miner, “Monthly Rare Earths MMI® Falls 10.5% to 34”, http://agmetalminer.com/2014/01/07/monthly-rare-earths-mmi-falls-10-5-to-34-2/, 07-19-14, TCT]

As further indication that Beijing’s campaign to reign in the Wild West that was the Chinese rare earths market in the last decade, China’s biggest producer of rare earths, the Inner Mongolia Baotou Steel Rare-Earth Group, has recently acquired nine regional mining companies as part of a government master plan to consolidate the sector.

Since 2010, it has tried to improve industry regulation, imposing tough new production and export quotas, raising environmental standards and cracking down on smuggling, once the source of nearly a third of the rare earths flowing to international markets. Arguably it was the flow of illegally produced rare earths onto the world market that decimated Western producers in the 1990s and 2000s, rather than a concerted plot by Beijing to take over the rare earth market.

Since 2010, Beijing has sought to consolidate both refining and mining under the control of a small number of state-owned producers. As a result, prices have risen steadily this year as illegal exports have been curbed and legal export prices have been raised. Nevertheless, export quotas are far from being fully utilized as global markets have reduced their dependence on rare earth metals and sectors like renewables and electric autos have failed to hit earlier volume expectations.

Dysprosium and Neodymium prices are extremely high nowGTN News, international commodity brokerage focusing primarily on Technology Metals, 6-22-14’

“Heavy Rare Earth Elements are Expected to See a Rapid Growth Due to Emerging Applications and Increasing Demand of Clean Energy - New Report by MicroMarket Monitor”, http://electio-invest.com/za/heavy-tech-metals-are-expected-to-see-a-rapid-growth-due-to-emerging-applications-and-increasing-demand-of-clean-energy-new-report-by-micromarket-monitor/#.U8sE5fldWkM, accessed 7/19/14, LLM)

Dysprosium Market:

Green Technology Industry is one of the major end-user industries to use rare earth metals. Rare earth elements such as neodymium, praseodymium, and dysprosium are key components in green technologies such as wind energy and hybrid electric vehicles. Prices for rare earths had been constant for the most part of the 1990s and the mid 2000s until the Chinese imposed a lot of restrictions on exports in 2011. The price of some critical rare earth metals, such as neodymium and dysprosium, increased by over 500%. Dysprosium is a bright silvery metal and

is one of the most expensive metals on this planet. It has been marked by many countries as one of the most critical rare earth metals needed for future use. In 2013, Asia-Pacific was the largest market for the demand of dysprosium oxide, with a share of approximately 81.8%, and it is expected to increase at a CAGR of 15.4% over the next five years.

Dysprosium prices have increased by over 500%GTN News 6/22

[6/22/14, GTN, “Heavy Rare Earth Elements are Expected to See a Rapid Growth Due to Emerging Applications and Increasing Demand of Clean Energy – New Report by MicroMarket Monitor,” http://www.mygtn.tv/story/25839171/heavy-rare-earth-elements-are-expected-to-see-a-rapid-growth-due-to-emerging-applications-and-increasing-demand-of-clean-energy-new-report-by, 7/19/14, IC]Green Technology Industry is one of the major end-user industries to use rare earth metals. Rare earth elements such as neodymium, praseodymium, and dysprosium are key components in green technologies such as wind energy and hybrid electric vehicles. Prices for rare earths had been constant for the most part of the 1990s and the mid 2000s until the Chinese imposed a lot of restrictions on exports in 2011. The price of some critical rare earth metals, such as neodymium and dysprosium, increased by over 500%. Dysprosium is a bright silvery metal and is one of the most expensive metals on this planet. It has been marked by many countries as one of the most critical rare earth metals needed for future use. In 2013, Asia-Pacific was the largest market for the demand of dysprosium oxide, with a share of approximately 81.8%, and it is expected to increase at a CAGR of 15.4% over the next five years.

Dysprosium prices will rise due to Chinese governmental actions—China is the controlling factorTopf, Investing News Network Senior Editor, 1/6

[Andrew, 1/16/14, Rare Earth Investing News, “Is China Setting the Stage for Higher REE Prices?” http://rareearthinvestingnews.com/19390-is-china-setting-the-stage-for-higher-ree-prices.html, 7/19/14, IC]

The question is, could Chinese consolidation cause rare earth prices to rise again, as they did in 2011?

It’s difficult to predict exactly how the consolidation will affect Chinese production of rare earths and their prices, but it’s clear that the Chinese government is sending a signal that it is prepared to tighten global supply. The Ministry of Commerce said in December that it will trim the initial batchof its 2014 export quota for the first time in two years, as per the Wall Street Journal.

However as we reported back in September, lessening the import quota does not necessarily have any effect on global rare earths supply, since most of Chinese production is used internally, and Chinese producers have not recently come even close to meeting their export quotas.

Perhaps of greater significance, is the government’s intention to lessen the number of rare- earth players in order to further centralize the industry. East Asia Forum reported that in 2010 there were 32 companies with a license to export rare earths, and while a firm number in 2014 is hard to attain, WSJ reports that the rare earths industry in Northern China is dominated by Baotou, and in Southern China, China Minmetals Corporation is the main producer, with other main players including Aluminum Corporation of China Limited and China Non-Ferrous Metal Mining.

Whether the new group set up to coordinate production quotas, as described above, will be able to properly police the industry including tackling the endemic smuggling problem, is anyone’s guess, but what we can say is that the government’s attempts this year to crack down on illegal rare earth mining have yielded higher prices . In June, the prices of terbium, praseodymium/neodymium and dysprosium, all rose due to a crackdown on illegal rare earth concentrate in Jiangxi province.

A wildcard in the prices game is how non-Chinese production will play into the prices of rare earth metals and oxides. Quoting Roskill Consulting Group, Shanghai Metals Market reported in October that non-Chinese rare earths, particularly light rare earths, are expected to increase 27 percent a year to 101,100 tonnes of rare earth oxides by 2020.

However for the more valuable heavy rare earths, most of which are produced in China, the Chinese are expected to continue dominating the market. According to Roskill, Chinese HREE production is expected to grow from 2013 to 2015 despite illegal producers being closed down.

“[I]n the rest of the world it is unlikely that operations will make any significant contribution to HREE supply before 2017. Potential producers continue to be afflicted by low rare earth prices and difficulty in obtaining finance in the current climate. This means that a number of projects have either been being pushed back or are being reevaluated,” according to Shanghai Metals Market.

On the other hand, some rare earth market observers are predicting a rebound in the sector, as end users tire of the Chinese monopoly and look to Western producers for a more steady supply stream.

“Do not be surprised to see the beaten down rare earth miners propel once again to the front pages of the mainstream media. End users will no longer rely on China and the highest quality assets are already gaining attention from the Europeans, Americans, Canadians, Japanese and Koreans,” wrote stock analyst Jeb Handwerger in his recent commentary “Ready for Rare Earth Rebound in 2014?”

Among Handwerger’s reasons for optimism: a perceived slight by Japan’s Prime Minister Abe against the Chinese for visiting the Yasukuni war shrine; and growing tensions between China and Japan over a set of disputed island in the South China Sea. Readers will recall that it was a 2010 collision between a Chinese fishing trawler and a Japanese Coast Guard patrol boat near the islands that led to China halting exports of rare earths to Japan, and as Handwerger describes it, “a mania in the rare earth mining sector in the West as end users realized the need

for a secure supply for these critical elements needed for high tech industries such as telecommunications, defense and the automobile sector.”

The bottom line for investors?

Don’t give up on rare earths as an investment thesis and watch events closely in China that could presage a price hike leading to a much-needed uptick in REE equities.

Neodymium prices are skyrocketing in the squoCED, Consumer Electronics Daily, 11 (Aug 31, “Speaker Makers Say Surging Neodymium Prices

From China At Crisis Stage”, http://www.warren-news.com/neodymium.html, 7-19-14, Tang)

In Harman International's fiscal Q4 earnings call earlier this month (CED Aug 11 p5), CEO Dinesh Paliwal cited raw components price increases of 1,000 percent amounting to $85 million for the company, which is putting "anyone buying neodymium in a tough spot" and "lucky to get allocation." With Harman's scale the company is able to guarantee allocation for now, but the company will have to re-tool and make adjustments, he said. Harman is a top supplier in automotive, home and professional speakers. " It's a serious situation," Robert Wills, president of InterSource OEM, told Consumer Electronics Daily. Wills buys neodymium magnets from factories in China and builds speakers in China for companies that include Alpine, Atlantic Technology and Sonance. What started as a manageable 10 percent rise in neodymium prices jumped, and kept jumping, from 100 to 200 to 500 to 1,000 percent, Wills said. "It's out of control," he said. " The rising cost of neo magnets is indeed a problem," said Doug Henderson, vice president-sales and marketing for B&W Group USA. Henderson cited 400 percent price increases for B&W that are forcing the company to review magnet design to try to reduce the mass of neodymium it uses through lighter tweeter domes and tighter voice coil gaps. But because of the benefits of the neodymium magnet — exceptional strength for its size, enabling designers to fit speakers into the smaller cabinets that consumers demand — "it is very hard to move away from it without major changes which would be difficult to implement," Henderson said. "So we are focused on lots of little changes to use less magnet material without compromising performance," he said. The problem is hitting everyone in the speaker market who needs to trade off size and weight, and that runs the gamut from automotive to home-theater-in-a-box to in-wall speakers. Neodymium is "particularly important" in automotive applications because of the strong influence weight has on gas mileage, said Ken Kantor, a speaker designer for NHT and others and now president of ZT Amplifiers in Berkeley, Calif. "There's a remarkable financial benefit to remove pounds from a car," Kantor said, citing figures from his days "six or seven years ago" as an automotive speaker designer when Ford paid "something like $4-$4.50 a pound" for a car to be built. Pulling a single pound from a vehicle's weight has an impact, especially at a time when "mileage sells," he said. Using a neodymium tweeter in a vehicle enables car makers to "halve the weight of a speaker" and charge a premium for their designs, he said. Automotive speaker technology tends to drive speaker manufacturing in general and neodymium has become widely used in automotive tweeters, he said.

Prices are high—production suspensions and falling exportsMineweb 2013

[Shivom Seth, 6/27/13, Mineweb, “Rare earth prices on the rise,” http://www.mineweb.com/mineweb/content/en/mineweb-industrial-metals-minerals-old?oid=195948&sn=Detail, 7/19/14, IC]

Even as new measures to consolidate the rare earth industry in China are on the cards, prices for the 17 elements have jumped 10% over the past two weeks. The report has indicated that prices of praseodymium-neodymium oxide stood at around $43,000 (270,000 yuan) per tonne on June 25, about $3,237 (20,000 yuan) higher than the price recorded two weeks ago, according to the Shanghai Securities Journal.

Prices of dysprosium oxide and terbium oxide, on the other hand, were quoting at $218,571 (1.35 million yuan) and $420,989 (2.6 million yuan) per tonne respectively on June 25, each higher by $3,237 as compared to a fortnight ago.

The average price of rare earths in 2012 fell close to 40% compared to 2011. To stop the price fall, firms across China adopted strategies such as production suspensions. However, falling demand in downstream sectors and illegal mining curbed the effects of such strategies.

Exports too were hit last year, with China's rare earth exports plummeting 71% given the several international trade suits.

Predictive evidence indicates that Dysprosium prices will increaseTopf, Investing News Network Senior Editor, 2013

[Andrew, 5/30/13, Rare Earth Investing News, “Have Rare Earth Prices Bottomed Out?” http://rareearthinvestingnews.com/10579-have-rare-earth-prices-bottomed-out.html, 7/19/14, IC]

Rare earth producers may have nothing but blue sky to look forward to after several months of gloomy weather, metaphorically speaking, regarding stagnant rare earth oxide (REO) prices.

A report this week by Morgan Stanley states that demand for REOs has troughed, suggesting prices could start to come back up following another 12 percent cross-the-board price decline in May. The caveat, however, is that more supply from Molycorp (NYSE:MCP) and Lynas Corporation (ASX:LYC) in the second half of this year could put more downward pressure on prices, according to a Morgan Stanley analyst quoted by StreetInsider.com.

The firm’s assessment is encouraging news at least in the short term for rare earth element (REE) producers that have seen a continued weak pricing environment. MetalMiner’s monthly Rare Earths MMI fell three points in May, to 39 points, a 7.1-percent decrease from 42 in April. Rare earths were the worst performing of any of MetalMiner’s MMI indices.

Bottom of Form

MetalMiner managing editor Lisa Reisman wrote on Seeking Alpha that the index was pulled down by falling prices of terbium, europium and dysprosium oxides. Dysprosium, used in lasers,

magnets and electronics, was worst hit with a 17.3 percent price decline. However, she also noted that the prices of eight other metals are up, including yttrium, yttria, terbium metal, samarium oxide, praseodymium oxide, neodymium oxide, neodymium and lanthanum oxide.

There are indeed encouraging signs that the two-year rout in rare earths prices could soon be coming to an end. Metal-Pages reported on Wednesday that industry sources are starting to see interest from high-net-worth investors who think that prices are close to bottoming out.

“There’s definitely a speculative interest in rare earths,” wrote Metal-Pages, quoting a European trader. “We’ve had a number of enquiries recently from investors.”

“Some of them have been talking of investments of up to $0.5-1.0 million,” said the trader, noting that six months ago there was no investor interest. Metal-Pages also said that some traders are restocking cerium, lanthanum and erbium oxides in hopes that prices have bottomed.

Price increases and supply increases are both inevitableBruno, Holds a BA, MA. He has worked for the United Nations in Libya and specialized in Middle Eastern, African, and South American affairs, 14

(Alessandro, “Northern Minerals on path to becoming a leading dysprosium producer by 2016”, http://investorintel.com/rare-earth-intel/northern-minerals-path-becoming-leading-dysprosium-producer-2016/, Accessed: 7/19/14) //AMM

The PFS confirms that, says Northern, Browns Range could be “the first significant world producer of high value dysprosium outside of China.” Northern says production could begin as early as the latter half of 2016. This means that the Browns Range project offers excellent economics because, apart from the presence of dysprosium (which

commands premium prices), the PFS was based on “a conventional mining operation involving both open cut and underground operations, and a relatively simple processing flow-sheet with all infrastructure located on

site”. The PFS also identified a base production of 279 MT of dysprosium per year and a total of 3,200 MT of mixed rare earth oxides. Such is the concentration of ‘heavies’ in the mix that Northern could survive on the production of dysprosium alone. Northern also noted that it has faced little difficulty in extracting

the xenotime (the mineral containing the rare earths) from the host rock. Having completed the feasibility study, therefore, Northern has also maintained a degree of financial ‘independence’, managing to keep control of funding

mechanisms as it moves to secure the capital to bring the project to production stage. The current resource estimate for the Browns Range project now stands at 4.13-million tons of at 0.68% (or 28,084 tons TREO).

Due to the global economic downturn, the rare earths market was marked by lower demand in the past two years, resulting in a price consolidation and a determined effort by the Chinese government to cut down on price distorting mechanisms as ‘black

market’ rare earths trading. China’s rare earth policy has also established the increasing buildup of strategic reserves by the Chinese government including terbium oxide, neodymium, gadolinium, dysprosium and praseodymium.

Heavy rare earths are mainly used in “green technologies” (electric transportation, wind turbines, energy saving lamps) and until

somebody starts to produce heavy rare earths outside of China, the supply situation with these rare earths is still at risk. Meanwhile, technology is not standing still and innovations requiring rare earths are launched every day .

Recently, General Electric announced that it has developed a new and very efficient generation of refrigerators that require magnets based on a gadolinium alloy. Clearly, given the size of the market for

refrigerators and the rising costs of electricity worldwide, this will boost global demand for gadolinium. In the

automotive sector, if Tesla succeeds in expanding its annual production from 22,500 to 500,000 cars a year, there will be a huge impact on demand for such metals as copper, lithium and rare earths. As the Chinese

government increases reserves stocks, it is reasonable to expect that prices for rare earths in China will rise in the coming weeks or months. China’s plan to introduce a new environmental tax on rare earths from 2015 is also likely to increase prices while, Lynas and Molycorp are not expected to bring any relief to rising

heavy rare earths demand. All of this is good news for those companies like Northern Minerals, focusing on heavy rare earths and taking the necessary technical and financial steps to head toward production just as the rare earths market should reach new peaks .

Demand for REM’s is high, and supply is increasingGee, NYT Writer, 14

[Alastair, May 2014, “THE RARE-EARTHS ROLLER COASTER”, http://www.newyorker.com/online/blogs/currency/2014/05/the-rare-earths-roller-coaster.html, 7/19/14, TYBG]

Most of the world’s rare earths are mined in China. In recent years, amid fears that China’s control of the market could jeopardize Western strategic interests, firms such as Elissa pursued deposits elsewhere—in the United States, Kyrgyzstan, Namibia, Vietnam, Greenland, Australia, and other countries. A boom was on. “A geologist would pick up a rock, lick it, and say, ‘Oh, I’ve got rare earths,’ and suddenly you’ve got a rare-earths company,” Gareth Hatch, a co-founder of the market-intelligence firm Technology Metals Research, said. The industry acquired an air of glamour, thanks to the futuristic uses of the metals, and a moniker suggestive of preciousness.

In fact, the rare earths—there are seventeen, and they have baroque names like dysprosium and gadolinium—are not all that rare. Most are more common in the earth’s crust than gold or silver, and they look like ordinary metals. But unlike gold and silver, they are not readily found in minable concentrations; their name derives from the difficulty of separating them out from one another. Nearly all the rare earths had been discovered by the end of the nineteenth century, but their uses were few. A shift began in 1949, when uranium prospectors carrying a Geiger counter hit upon an unusually radioactive zone in the desert, about sixty miles from Las Vegas. They found thorium, a radioactive metal often contained in rare-earth deposits. In 1950 and 1951, a firm called the Molybdenum Corporation of America (later renamed Molycorp) bought the rights in the area and soon opened a mine called Mountain Pass. In the coming decades, Mountain Pass would provide a significant portion of the rare earths utilized around the world.

With advances in technology, applications for rare earths proliferated. In the sixties, electronics manufacturers discovered that europium and yttrium could produce the red hue in TV sets. The oil industry realized that rare earths could help refine petroleum. Today, magnets that combine neodymium with iron and boron, making them exceptionally strong, are found in wind turbines, electric motors, and headphones. Dysprosium is used in military guidance-and-control systems, and lanthanum in Toyota Prius battery packs.

Plenty of rare earth metals – US private companiesMarket Watch, 14

[Wall Street Journal Economic Report, “U.S. Rare Earths Announces Extraction Of Critical Rare Earths In Montana COMPANY PLANS TO EXPAND IN 2014 BASED ON ITS DRILLING SUCCESS”, http://www.marketwatch.com/story/us-rare-earths-announces-extraction-of-critical-rare-earths-in-montana-2014-01-09, TYBG]

U.S. Rare Earths, Inc., UREE 0.00% , a U.S. based domestic rare earths exploration company with more than 25,000 acres of mining claims in Idaho, Montana, and Colorado, announced today that it is beginning 2014 having successfully extracted the first critical rare earths in the continental U.S. The deposits come from the company's Last Chance Property in Montana. Preliminary metallurgical leach testing was completed by SGS of Ontario, Canada. The leach test results demonstrated a 79 percent recovery of Critical Rare Earths.

Four different leaching approaches were used to extract rare earth metals into a solution and warrant further optimization. The initial results indicate the technical feasibility of extracting much needed Critical Rare Earths for U.S. consumption from USRE's Last Chance Property.

Wind Turbine Demand IncreasingWind turbine demand is increasing – that causes shortagesFrontier Rare Earths, mineral exploration and development company, 13[1/7/13, Frontier Rare Earths, “IHS forecasts shortages for some rare earth elements in new study,” http://www.frontierrareearths.com/media-cover/blog/82-ihs-forecasts-shortages-for-some-rare-earth-elements-in-new-study, accessed 7/19/14, TYBG]According to a new IHS Chemical (NYSE: IHS) global market research report, a growing global dependence upon a multitude of diverse technologies—including computers, smart phones, TVs, lighting systems, hybrid automobiles, life-saving medical technologies, offshore wind turbines, petroleum refining, microwave communications and laser-guided missile defense systems -- has left manufacturers and countries vulnerable to the availability and uninterrupted supply (largely from China) of some key elements used to produce these technologies, called rare earthsIn the report, the IHS Chemical CEH Rare Earth Minerals and Products Report, production and consumption of these industrial minerals in 2012 was more than 100 thousand metric tons (KMT). During the study period of 2012 to 2017, IHS estimates average global demand for rare earth products will grow by 7.6 percent annually, reaching more than 150 KMT of consumption, with China leading consumption growth at 8.3 percent annually.Rare earths are a set of 17 chemical elements in the periodic table, more specifically, the 15 lanthanides, plus scandium and yttrium, which share similar chemical properties. Despite their name, rare earth elements are fairly abundant. The challenge for manufacturers and countries dependent upon these minerals though, is two-fold. First, they generally occur naturally as mixtures of various rare earth elements and are not always found in economically exploitable concentrations. Second, the minerals must be mined, then concentrated into rare earth oxides, and finally, separated into individual rare earth elements and compounds.A major proportion of the world’s rare earth reserves are located in China – the production and consumption of rare earths is dominated by China. China alone accounted for more than 85 percent of world rare earth production in 2012, and consumed approximately 70 percent. In terms of consumption, Japan followed with approximately 15 percent of world production in 2012, but has no domestic rare earth reserves. This imbalance creates an uncomfortable dependence for Japan and other countries requiring both a steady supply of these elements and pricing stability.Recently, these issues came to a head in a dramatic way according to Samantha Wietlisbach, principal analyst of specialty chemicals at IHS Chemical and the report’s lead author. “Supply disruptions over the last few years interrupted Japanese automotive and electronics industry production and sent shock waves through the global manufacturing industries that rely on rare earths,” Wietlisbach said“Other governments have realized their national security interests and industrial sectors were vulnerable, since China dominates the market in terms of both supply and demand,” she said. “The supply shortages also resulted in unprecedented price spikes, impacting global consumers of these materials. It was a wake-up call to address diversity of supply and to explore possible substitutions. This, in turn, has led to many new mining projects being announced globally, with rare earth ore as the main product.”

The various markets for rare earths, as mixtures, individual elements or compounds, have developed in a very sporadic fashion and are, essentially, a two-tiered system, Wietlisbach said. “New markets are strong and growing for individual, specialized and high-purity rare earths, particularly for neodymium, which is used in high-performance magnets (permanent magnet motors or PMs) for hybrid vehicles, offshore turbines and defense guidance systems. While the markets for mixed rare earth oxides (REOs), which formerly constituted the bulk of the business, show stagnant demand.”A large share of the world’s rare earth concentrate supply is produced as a by-product or co-product of other mining activities. Minerals containing rare earths are currently produced in seven countries/regions—China, the CIS, the U.S., Australia, India, Brazil and Malaysia. Lanthanum and cerium accounted for nearly 60 percent of world consumption of rare earth oxides in 2012, followed by neodymium, yttrium and praseodymium. The other elements accounted for less than 5 percent of total rare earth consumption worldwide.Lanthanum is used for rechargeable batteries in hybrid cars, fluid catalytic cracking catalysts (FCC) used to produce gasoline efficiently, as a glass additive for camera and telescope lenses, and in lasers and x-ray films to reduce the amount of radiation exposure for patients. Neodymium’s most important use is in high power magnets, which are found in hybrid vehicle motors, wind turbines, low voltage electric motors, but also mobile phones, microphones, speakers and headphones. Yttrium is critical for television screens and monitors, as well as in fluorescent lights to produce brilliant white light. It is also used in microwave communications, in lasers, and as transmitters and transducers of acoustic energy. Praseodymium is used widely in metallurgical applications, especially high-strength magnesium alloys used in aircraft engines.Said Wietlisbach, “There is a distinct imbalance between the consumption of some rare earth oxides compared to the amount produced. In 2012, there was an excess of cerium and dysprosium produced, but for lanthanum, praseodymium, neodymium and europium, demand exceeded supply. However, with that being said, the expected growth in demand for offshore wind turbines during the next five to 10 years means the amount of dysprosium and other less-abundant rare earths used to produce PM motors, are expected to be in short supply.”

Demand Increasing NowREM’s like Dysprosium will become more expensive and rareFrearson, Business Reporter, 14

[Joanne, 6/26, Business Reporter, “Rocking all over the world: the rare earth metals market,” http://business-reporter.co.uk/2014/06/rocking-all-over-the-world-the-rare-earth-metals-market/, 7/19/14, BS]

The demand for heavy rare earth elements is likely to rise as the use of green energy technologies increases and supply remains tight – while some light rare earths are moving to a position of

oversupply. According to a report by research firm MarketsandMarkets, the demand for rare earth metals is estimated to reach 192,000 tons by 2018. Demand is strongest in the Asia-Pacific region, with China accounting for

60 per cent of global rare earth consumption. Although light rare earths such as lanthanum (used to make nickel metal

hydride batteries for electric and hybrid vehicles) and cerium (used to polish glass, metal and gemstones) capture around 62 per cent of the market share, they are more abundant in the earth’s surface, and it is the heavier rare earths which will see their value increase. Rarer heavier earths which will be in demand include yttrium, europium and terbium used in energy efficient fluorescent lamps and bulbs, erbium

which is used in lasers for medical and dental use, and dysprosium, used in the manufacture of neodymium-iron-boron high-strength permanent magnets. Rocking all over the world 2Paul Lusty, team leader of Ore Deposits

and Commodities at the British Geological Survey, says: “Heavy rare earth elements are more expensive than the light rare earths because of their geological availability and market demand for them, which is generally expanding because of specialist applications in new technologies. “There is limited scope for rare earths to be substituted for other materials in these applications and the heavy rare earth elements are essential for their

performance. Projections suggest supply will be problematic for yttrium, europium and terbium and may be challenging for other important elements such as erbium and dysprosium . They are more likely to

sustain higher prices or see some price increase going forward. “For elements like terbium the supply situation is going to continue to be quite tight over the next few years, probably at least up to 2016 or the end of the decade until we see some significant heavy rare earth producing operations outside China actually coming online. The real major growth areas are associated with green or clean energy technologies. Many of the rare earths have important magnetic characteristics. They are used in industrial motors, hard disk drives, hybrid electric vehicles and wind turbines. Analysts are

predicting increased demand for magnets which use rare earths.” At the moment, China has the monopoly in the rare earth market, but the emergence of new players in the industry is likely to have an impact on prices. China accounts for 85 per cent plus of global rare earth production, though Lusty says that new operations in the US and Australia are starting to make an impact on China’s share of the market for some elements. Companies such as US-based Molycorp and Australian firm Lynas have both started operating their rare earth mines which will see production of rare earth metals increase

substantially. But Lusty says such changes will take some time to affect the industry’s strategy. “In terms of

the future it takes a long time for the mining industry to respond to changes in demand ,” he says. “It is probably going to be at least another 10 years before we see a diverse supply base outside China. The processing of rare earth is complex. It is unlikely that more than a handful of those projects that are currently being explored will reach the commercialisation stage and become producing mines.”

Demand for REMs is increasing and the necessary supplies are dwindling – price spikes are inevitableJones, writer Yale Environment 360, 13[Nicola, 11/18/13, Yale Environment 360, “A Scarcity of Rare Metals Is Hindering Green Technologies,”

http://e360.yale.edu/feature/a_scarcity_of_rare_metals_is_hindering_green_technologies/2711/, accessed 7/19/14, TYBG]With the global push to reduce greenhouse gas emissions, it’s ironic that several energy- or resource-saving technologies aren’t being used to the fullest simply because we don’t have enough raw materials to make them. For example, says Alex King, director of the new Critical Materials Institute, every wind farm has a few turbines standing idle because their fragile gearboxes have broken down. They can be fixed, of course, but that takes time – and meanwhile wind power isn’t being gathered. Now you can make a more reliable wind turbine that doesn’t need a gearbox at all, King points out, but you need a truckload of so-called "rare earth" metals to do it, and there simply isn’t the supply. Likewise, we could all be using next-generation fluorescent light bulbs that are twice as efficient as the current standard. But when the U.S. Department of Energy (DOE) tried to make that switch in 2009, companies like General Electric cried foul: they wouldn’t be able to get hold of enough rare earths to make the new bulbs. The move toward new and better technologies — from smart phones to electric cars — means an ever-increasing demand for exotic metals that are scarce thanks to both geology and politics. Thin, cheap solar panels need tellurium, which makes up a scant 0.0000001 percent of the earth’s crust, making it three times rarer than gold. High-performance batteries need lithium, which is only easily extracted from briny pools in the Andes. Platinum, needed as a catalyst in fuel cells that turn hydrogen into energy, comes almost exclusively from South Africa.Researchers and industry workers alike woke with a shock to the problems caused by these dodgy supply chains in 2011, when the average price of "rare earths" — including terbium and europium, used in fluorescent bulbs; and neodymium, used in the powerful magnets that help to drive wind turbines and electric engines — shot up by as much as 750 percent in a year. The problem was that China, which controlled 97 percent of global rare earth production, had clamped down on trade. A solution was brokered and the price shock faded, but the threat of future supply problems for rare earths and other so-called "critical elements" still looms.

Demand is rising and projected to stay the course – shortages are comingAdmiral Metals, metal manufacturer, 13[2/27/13, Admiral Metals, “Rare Earth Metals – Rare or in Short Supply?,” http://www.admiralmetals.com/admiral-metals/rare-earth-metals-part-1/, accessed 7/19/14, TYBG]The process of bringing rare earth metals to an exploitable form includes mining (mostly from bastnaesite mineral deposits), separation, refining oxides into metals, fabricating alloys, and final manufacturing into various components. Until the late 1980’s, the US dominated global production mostly through mining in Mountain Pass, California. In the past 20 years, US production has slowed due to environmental and safety concerns, the resulting regulations and restrictions causing prohibitive mining costs. Now, US development is improving, but ramping up mine production is expensive and time-consuming (about $500 million to $1 billion to start a mine which could take 8 years).The US slow down left room for China to become the dominant player in all aspects of the rare earth supply chain. In recent years, China has actively expanded its rare earth metals reserves and tends to manage its exports with little transparency. A Reuters report from the US

Geological Survey estimated that China holds about half the world’s rare earth metals reserve and produces more than 95% of the world’s supply.At the same time, demand has been growing annually. Currently, worldwide demand is at about 134,000 tons each year while production is only at 124,000 tons. The rest comes from above ground reserves. If this trend were to continue, by 2014, demand could reach close to 200,000 tons. Supply shortages are expected in those countries without reserves or alternative technologies.

Ocean Mining Solves - GenericOcean floor mining solves REM scarcity – extraction is feasible and low costGreen, writer for Robotics Business Review, 14 [Tom, 6/28/14, Robotics Business Review, “Deep Sea Dive for Rare Earth Elements,” http://www.roboticsbusinessreview.com/article/deep_sea_dive_for_rare_earth_elements]With over 30 percent of the world’s known REE deposits and by far the cheapest extraction process, China supplies 95 percent of the world’s REEs. However, China, with a rising middle class and booming domestic market, is steadily reducing export quotas. The Word Trade Organization (WTO), of which China is a member, ruled in March of 2014 that China was hoarding and taking unfair advantage of the market. That decision was two years in coming, and now China will appeal the current WTO judgment, which might take another two years. Byron Capital analyst, John Hykawy said “I’ve heard from so many critical materials buyers at large corporations that they want security of supply. And security of supply to them means avoiding Chinese supply at all costs because they got fooled once. They don’t want to get fooled again.” 2- to 3-miles down: REEs not alone on the seabed In the meantime, REEs are again getting to be in short supply, and with demand forecast to progressively increase, the world drastically needs new suppliers of REEs . The London Metal Exchange lists neodymium at $800 Kg; terbium metal at 1,900 Kg; and scandium metal 15,500.00 per Kg. Relatively inexpensive is lanthanum at $13 Kg. However, the battery in a Toyota Prius hybrid requires more than 10kg of lanthanum. Now multiply $130 times millions of Toyota’s and the need for lots of lanthanum comes into focus. Stephen Ball, chief executive officer of Lockheed Martin UK, owner of UK Seabed Resources, told the BBC “It’s another source of minerals – there’s a shortage and there’s difficulty getting access, so there’s strategic value for the UK government in getting an opportunity to get these minerals.” UK Seabed Resources says surveys have revealed huge numbers of nodules – small lumps of rock rich in valuable metals – lying on the ocean floor south of Hawaii and west of Mexico. The exact value of these resources is impossible to calculate reliably, but a leading UN official described the scale of mineral deposits in the world’s oceans as “staggering” with “several hundred years’ worth of cobalt and nickel.” “These tennis-ball sized nodules, found approximately four kilometers (2.5 miles) beneath the ocean’s surface, can provide millions of tons of copper, nickel, cobalt and manganese, as well as rare earth minerals, that are used in the construction, aerospace, alternative energy, and communications industries, among others,” reports Lockheed Martin. The Japan Agency for Marine-Earth Science and Technology and the University of Tokyo confirmed the discovery of a “huge new deposit” on the Pacific seabed, claiming the “deposit can be mined at very low cost and will be able to produce materials that are 20 to 30 times more concentrated than those currently being mined in China.”

Ocean mining completely ends the Chinese monopoly – deposits are massive, highly concentrated, and easily extractableWorstall, Fellow at the Adam Smith Institute, 13 [Tim, 3/25/13, Forbes, “Japan's New Rare Earth Discovery: That's China's Monopoly Entirely Blown,” http://www.forbes.com/sites/timworstall/2013/03/25/japans-new-rare-earth-discovery-thats-chinas-monopoly-entirely-blown/]

Japan has just announced another vast discovery of rare earth bearing materials on the ocean floor. This does rather put an end to any possibility of China having a long term lock on the supply of these vital elements. Japan is celebrating the find of an “astronomically” high level of rare earth deposits at the bottom of the Pacific Ocean, a discovery which will further undermine China’s failing attempts to control the global supply of the substances. You might recall a couple of years back there was a similar Japanese claim. There it was that the plumes from underwater volcanoes were rich in rare earths. This makes good sense as rare earths are constituents of pegmatites, pegmatites come from volcanoes. Thus, given that these are underwater volcanoes, instead of the REs becoming part of the rock they’re floating off through the water as dust. Further, the floating through the water part does some of the separation of the REs from the other components (as surface water does some of the sorting of alluvial deposits as they weather out of the same types of rocks) so there were areas of sediment that were RE rich. This finding is a little different. Almost certainly from the same general source: but now the RE rich material is in nodules just under the silt of the ocean floor. This makes it all rather easier to raise from 5,000 metres down. There is another issue here. Rare earths are usually divided into two sets the lights and the heavies. The new land based mines (Molycorp, Lynas and so on) don’t have much of the heavies in them. So despite our having more REs to play with, China still pretty much has a lock on the heavy ones, the terbium, dysprosium and europium, that we would really like to have more of. This Japanese find is highly enriched in the heavies. Which rather neatly seems to solve that problem. This isn’t something that’s going to go into production this year of course. I’d be amazed if it does so this decade in fact. But it does lift the possibility of China retaining a production monopoly.

Ocean Mining Solves - China MonopolyUS mining will undermine China’s REM monopolySavitz, Forbes staff writer, 12

[Eric, 6/8/12, Forbes “Rare Earth Minerals: And End To China’s Monopoly,” http://www.forbes.com/sites/ciocentral/2012/06/08/rare-earth-minerals-an-end-to-chinas-monopoly-is-in-sight/]

North America is finally waking up to the consequences of a continued Chinese monopoly and has quietly invested significant money and resources into mining rare earth minerals domestically. In fact, there are currently 35 rare earth projects at various stages in development outside of China (according to advisory firm Technology Metals Research). The most mature operation is right here in North America – Molycorp‘s Mountain Pass, California mine. Several other mines are also progressing nicely in the Northeast Corridor of Canada. A major shift is taking place, and it’s possible that 15-20 percent of rare earth minerals could be mined outside of China by the end of 2020. In addition to loosening China’s stranglehold on the market, even a 10 percent shift in market share would have a positive ripple effect on the U.S. manufacturing and technology sectors: An increase in U.S. high-tech production could spur the revival of other domestic manufacturing. Many U.S. companies are already relocating portions of their high-tech production from China to North America for cost savings – mainly due to high logistics and rising labor costs. Add to that the multitude of unpredictable global supply risks – like we saw with the Japan earthquake and tsunami – a new and steady source of domestic rare earth minerals could accelerate a U.S. manufacturing revival . New electronics suppliers will push product innovation. There’s been a woeful lack of innovation coming out of China and Japan over the past few years. Instead of new genre-defining products, the most highly sought-after products we see every holiday season tend to be the “latest and greatest” – third and fourth generations of already existing products. Without major competition from new suppliers trying to make a splash in the tech scene, the big boys are able to maintain the status quo. Increased competition will create more products and lower prices : a welcome win for innovation-starved consumers. More consumer-friendly prices . An upswing in U.S. high-tech manufacturing also has the potential to drive product prices down. The obvious reasons: logistic costs and supply risk. Beyond saving on transportation costs, U.S. companies will be able to strike longer deals with suppliers – thus locking in better terms. Domestic sources must operate under U.S. business regulations, making them a more predictable and reliable source of supplies.

Non-unique – WTO RulingChina’s industry will collapse and other countries solve shortages – WTO rulingReuters, 14[3/26/14, Reuters, “Rare earth prices to fade as mines up output, China loses dispute,” http://www.reuters.com/article/2014/03/26/rareearths-prices-idUSL5N0MN2MG20140326, accessed 7/18/14, TYBG]LONDON, March 26 (Reuters) - Rare earth elements will drop further in value this year as new mines boost output and after China lost a trade dispute over its export controls, while demand in high-tech products disappoints.Prices of the 17 elements used in technologies such as smartphones and electric cars have mostly been stuck in tight ranges after skyrocketing and then tumbling in 2010-2011.A few rare earths attempted a rally late last year, but remain well below the spike three years ago after China clamped down on exports.The world's second-biggest economy, which not only produces 90 percent of global rare earths but is the largest consumer, lost a dispute at the World Trade Organization on Wednesday.A consultant said a price war could break out after the United States, European Union and Japan won their case over export restrictions they said gave Chinese companies an unfair competitive edge in key high-tech sectors."If the recent WTO ruling leads to a softening of China's rare earth industry policy measures, the nation's only tangible defence becomes competing head-to-head on price with emerging global producers," said Ryan Castilloux, founding director at Adamas Intelligence in Sudbury, Ontario.Investors are already worried about excess supply as U.S. mining group Molycorp Inc and Australia's Lynas Corp boost output at their new mines."We still remain concerned about the likely downward pressure on rare earth pricing if Molycorp achieves its production guidance by the fourth quarter of this year," analyst Michael Gambardella at JPMorgan said."We continue to believe that all rare earth prices will move meaningfully lower as Molycorp and Lynas ramp to just their full Phase 1 capacities," he said in a note.Molycorp aims to boost output to 20,000 tonnes a year, after producing about 1,000 tonnes of rare earth oxides in the fourth quarter."If we start seeing new mines being constructed outside of China and demand does not grow to absorb this new production, then China may see its REE (rare earth element) industry, at least the upstream end of it, under threat, leading it to undercut competitors on price," Castilloux said.China has been struggling to control illegal mining and smuggling in its rare earth industry despite a two-year campaign to consolidate output in the hands of big state-owned miners.

China Monopoly CollapsingChinese rare earth metal monopoly is collapsingTopf, editor at Rare Earth Investing News, 13 (Andrew Topf editor at MINING.com Investing News “Rare Earths Outlook: Prices to Rise, Western Producers Cutting Into Chinese Monopoly” December 23, 2013 http://rareearthinvestingnews.com/19313-rare-earths-outlook-prices-to-rise-western-producers-cutting-into-chinese-monopoly.html)“New suppliers like Molycorp and Lynas are already significant-enough producers to influence the price (Molycorp is running at about 7,000 tons per year , compared to China’s current run rate of some 20,000+ tons per year) , and with ongoing investment likely to raise this figure, China’s days of having a stranglehold on the market are, if not over, then at least severely limited.” Of course, this is all dependent on Molycorp and Lynas reaching stated production goals. Both companies have faced roadblocks in this respect, with Molycorp falling behind its stated 15,000 tonnes per year target, and Lynas also admitting output trouble. Referring specifically to magnets, a large market for rare earth metals, Molycorp spokesman Jim Sims told Bloomberg that Molycorp and Lynas “are increasing their production so there’s a growing diversity of supply for those rare-earth materials that eventually go into the magnets.” The article also said that while China is the primary source of REEs for the production of magnets , a U.S.-Japanese joint venture “has developed the technology for producing these magnets and is building a facility in Japan,” referring to a JV signed in 2010 between Molycorp and Hitachi (TYO:6501) to produce neodymium-iron-boron (NdFeB) alloys and magnets. The news from the Pentagon came a few months after Russia announced that it would spend $1 billion to produce rare earths in a bid to reduce its dependence on China. The funds would come from Rostec and and investment company IST Group, which agreed to plow a billion dollars into Russian rare earths production by 2018. Then there’s the step that Greenland took in October of lifting its moratorium on rare earth and uranium mining. The ban’s removal is likely to attract foreign investors to the Arctic landmass in search of its prized rare earth deposits. While that could still be a ways off, there is already a sign that Chinese rare earths dominance is under threat . An article last Friday in Xinhua, the Chinese state-owned news agency, said that Chinese rare rare earth miners are being forced to phase out excessive production capacity as overseas suppliers chip away at their dominance in the global market.

China’s monopoly is collapsing now – increased international production and prices.Investor Intel, investing news source, 13 [12/23/13, Invester Intel “Breaking China’s stranglehold on the Rare Earths Industry,” http://investorintel.com/rare-earth-intel/breaking-chinas-stranglehold-rare-earths-industry/]There is light on the horizon. Like everything in life, nothing stands still. And the REE industry is no different. The importance of rare earths has only grown as emerging markets increase their demand for technologies made with it, as does the renewable energy industry. When it comes to China’s monopoly of rare earths , it appears we are approaching the beginning of the end. As the Chinese REE stranglehold is reduced through increased production from the only two non- Chinese sources currently , and Chinese rare earth prices rise due to continued efforts by the

Chinese government to address environmental concerns and stop illegal rare earth mining , rare earth investors could potentially see higher prices in 2014, which in turn would translate into higher stock prices for REE companies . According to the Pentagon’s latest assessment of the rare earths industry, China’s virtual monopoly on the industry has been disrupted . In it’s annual report to Congress (dated October 2013, but not yet been released publicly), the Pentagon report (prepared by Elana Broitman, the Defense Department’s top official on the US industrial base), stated: “Global market forces are leading to positive change in rare earth supply chains, and a sufficient supply of most of these materials likely will be available to the defense industrial base. Prices for most rare earth oxides and metals have declined approximately 60% from their peaks in the summer of 2011.” In 2011, Congress required the Pentagon to examine the use of rare earth materials in defense applications, determine if non-U.S. supplies might be disrupted, and suggest ways to ensure long-term availability, as well as secure an assured source of supply by 2015.

AT: K2 SolarREMs aren’t key to solar – new tech means earth-abundant materials solveAmerican Chemical Society 12 [8/21/12, ACS, “New solar panels made with more common metals could be cheaper and more sustainable,” http://www.acs.org/content/acs/en/pressroom/newsreleases/2012/august/new-solar-panels-made-with-more-common-metals-could-be-cheaper-and-more-sustainable.html]With enough sunlight falling on home roofs to supply at least half of America’s electricity, scientists today described advances toward the less-expensive solar energy technology needed to roof many of those homes with shingles that generate electricity. Shingles that generate electricity from the sun, and can be installed like traditional roofing, already are a commercial reality. But the advance ― a new world performance record for solar cells made with “earth-abundant” materials ― could make them more affordable and ease the integration of photovoltaics into other parts of buildings, the scientists said. Their report was part of a symposium on sustainability at the 244th National Meeting & Exposition of the American Chemical Society, the world’s largest scientific society, being held here this week. Abstracts of other presentations appear below. “Sustainability involves developing technology that can be productive over the long-term, using resources in ways that meet today’s needs without jeopardizing the ability of future generations to meet their needs,” said Harry A. Atwater, Ph.D., one of the speakers. “That’s exactly what we are doing with these new solar-energy conversion devices.” The new photovoltaic technology uses abundant, less-expensive materials like copper and zinc ― “earth-abundant materials” ― instead of indium, gallium and other so-called “rare earth” elements. These substances not only are scarce, but are supplied largely by foreign countries, with China mining more than 90 percent of the rare earths needed for batteries in hybrid cars, magnets, electronics and other high-tech products. Atwater and James C. Stevens, Ph.D., described successful efforts to replace rare earth and other costly metals in photovoltaic devices with materials that are less-expensive and more sustainable. Atwater, a physicist at the California Institute of Technology, and Stevens, a chemist with The Dow Chemical Company, lead a partnership between their institutions to develop new electronic materials suitable for use in solar-energy-conversion devices. Atwater and Stevens described development and testing of new devices made with zinc phosphide and copper oxide that broke records for both electrical current and voltage achieved by existing so-called thin-film solar energy conversion devices made with zinc and copper. The advance adds to evidence that materials like zinc phosphide and copper oxide should be capable of achieving very high efficiencies, producing electricity at a cost approaching that of coal-fired power plants. That milestone could come within 20 years, Atwater said. Stevens helped develop Dow’s PowerHouse Solar Shingle, introduced in October 2011, which generates electricity and nevertheless can be installed like traditional roofing. The shingles use copper indium gallium diselenide photovoltaic technology. His team now is eyeing incorporation of sustainable earth-abundant materials into PowerHouse shingles, making them more widely available. “The United States alone has about 69 billion square feet of appropriate residential rooftops that could be generating electricity from the sun,” Stevens said. “The sunlight falling on those roofs could generate at least 50 percent of the nation’s electricity, and some estimates put that number

closer to 100 percent. With earth-abundant technology, that energy could be harvested, at an enormous benefit to consumers and the environment.”

Zinc cells solve solar development without REMsWilton, writer for University of Oxford science blog, 12 [Pete, 6/28/12, University of Oxford, “Zinc could replace 'rare earths' in solar cells, screens”, http://www.ox.ac.uk/media/science_blog/120628.html]Costly and rare indium, used in solar cells, and screens for TVs, computers, and mobile phones, could be replaced with abundant and cheap zinc, scientists at Oxford University believe. Because of its combination of high transparency and high electrical conductivity indium tin oxide (ITO) dominates the global market for coatings for solar cells and LCD displays. The market for the material is estimated to be worth $26.8bn by 2016. However indium, a so-called 'rare earth' metal, is relatively scarce and expensive and its supply is tightly controlled - China produces over half of the world’s indium and recently reduced its export quotas. Peter Edwards and colleagues at Oxford University's Department of Chemistry have been investigating how to make alternative coatings from cheaper, more abundant materials. Their research has come up with new coatings based on silicon-doped zinc oxide. The Oxford team has been working closely with Isis Innovation, the University's technology transfer company, to protect and commercialise its research. As Isis report today, the team has just won the Materials Science Venture Prize, awarded by the Worshipful Company of Armourers and Brasiers, to develop manufacturing processes for the group's coatings. Peter comments: 'Zinc is a much more abundant material than indium, and our silicon-doped zinc oxide material offers electrical conductivities around two thirds of ITO, with comparable optical transparency. In addition to solar cells, our new coating could be used with lighting displays and LCD displays used in smart phones, computers and televisions.’

AT: REMS K2 Nuclear WeaponsThe nuclear weapons program is being maintained and modernized now – no loss in usage capabilityCollina, Research Director at the Arms Control Association, 14 [Tom Z., January, ACA, “U.S. Nuclear Modernization Programs,” https://www.armscontrol.org/factsheets/USNuclearModernization]For Fiscal Year (FY) 2014, nuclear weapons activities in the Department of Energy’s National Nuclear Security Administration (NNSA), which oversees the U.S. nuclear stockpile and production complex, will be funded at $7.78 billion, an 11.6 percent increase over FY 2013 at a time when other defense budget accounts are in decline.[ii]¶ The U.S. military is in the process of modernizing all of its existing strategic delivery systems and refurbishing the warheads they carry to last for the next 20-30 years or more. These systems are in many cases being completely rebuilt with essentially all new parts. ¶ This effort includes:¶ Modernized Strategic Delivery Systems: U.S. nuclear delivery systems are undergoing continual modernization, including complete rebuilds of the Minuteman III ICBM and Trident II SLBM. The service lives of Trident Ohio-class ballistic missile submarines are being extended. Additionally, a new submarine, the SSBNX, which will replace the existing Ohio-class ballistic missile submarines, is undergoing development and is expected to cost about $100 billion, according to the Congressional Budget Office. The B-2 strategic bomber, a relatively new system, is being upgraded, as is the B-52H bomber. The Air Force is also planning a new Long Range Bomber and a new cruise missile to replace the Air-Launched Cruise Missile (ALCM).¶ Refurbished Nuclear Warheads: The U.S. stockpile of nuclear warheads and bombs is continually refurbished through NNSA’s Life Extension Program (LEP). Existing warheads are certified annually to be safe and reliable. The JASON panel of independent scientists has found “no evidence” that extending the lives of existing U.S. nuclear warheads would lead to reduced confidence that the weapons will work. The panel concluded in its September 2009 report that “Lifetimes of today's nuclear warheads could be extended for decades, with no anticipated loss in confidence.”[iii] The United States does not need to resume nuclear test explosions, nor does it need to build new “replacement” warhead designs to maintain the reliability and effectiveness of the U.S. nuclear stockpile. ¶ Modernized Production Complex: The nuclear weapons production complex is being modernized as well, with new facilities planned and funded. The FY 2014 NNSA budget includes $309 million for the Uranium Processing Facility (UPF) at Oak Ridge, Tennessee. The total construction cost for UPF is estimated at $6.5 – 7.5 billion, according to an independent study conducted by the Corps of Engineers.[iv]

AT: DeterrenceNo impact to nuclear deterrence – threats aren’t credible and conventional weapons solveGerson, research analyst at the Center for Naval Analyses, 10 [Michael S., Fall 2010, CAN, “The Next Step for U.S. Nuclear Policy,” International Security, Vol. 35, No. 2 , pp. 7–47]The threat to use nuclear weapons first may lack credibility in the minds of many current and potential adversaries. The first-use option can contribute to deterrence and security only if the opponent believes that there is at least some reasonable chance that the United States might actually use nuclear weapons first. In today’s international security environment, no state can doubt that the United States possesses sufficient nuclear capabilities to inºict severe costs, but a state reasonably could question whether the United States has the requisite political resolve to use nuclear weapons first, especially over stakes that do not directly threaten U.S. national security interests.84 The incredibility of U.S. first-use threats rests on several grounds. First, as discussed above, there are no realistic military contingencies that would require the first use of nuclear weapons. Absent a compelling military need to use nuclear weapons first, U.S. nuclear threats are unnecessary and will therefore lack credibility. Conversely, U.S. conventional capabilities are highly credible and have been demonstrated in numerous post–Cold War operations to be more than sufficient to inºict substantial costs, and it is unlikely that an opponent would believe that the United States would use nuclear weapons if there were effective conventional options. In fact, the emphasis in recent years on developing a new generation of high-precision, long-range conventional weapons—exemplified by the U.S. military’s Prompt Global Strike mission, which seeks to develop conventional capabilities that can strike targets anywhere in the world within one hour85—demonstrates how hard the United States is working to preclude having to use nuclear weapons in any contingency short of a response to a nuclear attack. Second, there are potentially significant political costs to the United States for using nuclear weapons first, especially regarding U.S. efforts to lead the charge against nuclear proliferation, and these costs diminish the credibility of U.S. first use.86 Given that the United States has traditionally been the most globally active nation in the realm of nonproliferation, the threat to use nuclear weapons first and risk undermining U.S. leadership of the NPT regime, legitimizing the use of nuclear weapons, and potentially spurring further proliferation will likely ring hollow. It would be difficult, if not impossible, for the United States to reconcile its first use of nuclear weapons with continued leadership on nonproliferation. Despite the national and international security benefits of U.S. activism against the further spread of nuclear weapons, an unintended consequence of these efforts has likely been to further weaken the credibility of U.S. threats to use nuclear weapons first. Third, whereas implicit or explicit nuclear threats from rogue states have some inherent credibility because of the belief that these regimes are fanatical and risk acceptant—that is why, after all, they are rogues—in the nuclear realm the United States is generally perceived to be rational, risk averse, and sensitive to civilian casualties and other collateral damage.87 These beliefs reduce the credibility of first-use threats by further strengthening the view that U.S. political leaders are bound by the “nuclear taboo,” a normative constraint against using nuclear weapons that emerged after World War II.88 For the United States, the nuclear taboo

inºuences the range of military options considered by decisionmakers by imposing criteria of proportionality and domestic and international legitimacy on the use of force, and such constraints are not lost on current and potential adversaries.89 Unlike rogue states, the United States does not readily benefit from the “rationality of irrationality,”90 which increases the credibility of nuclear threats by convincing decisionmakers that the opponent might not make logical cost-benefit calculations, and therefore might not be constrained by the logic of appropriateness on which the nuclear taboo depends. Despite the contention of one high-level advisory panel to U.S. Strategic Command arguing that “it hurts to portray ourselves as too fully rational or cool-headed,” and that “the fact that some elements may appear to potentially be ‘out of control’ can be beneficial,” U.S. policymakers have been reluctant to send these kinds of signals in the nuclear arena since the end of the Cold War.91

AT: US-China ConflictRelations are resilientRussel, Assistant Secretary, Bureau of East Asian and Pacific Affairs, 6/25/14[Daniel R., U.S. State Department, “The Future of U.S.-China Relations”, http://www.state.gov/p/eap/rls/rm/2014/06/228415.htm, accessed 7/8/2014 CK]Yet there is still enormous potential for progress in the U.S.-China relationship. Progress that will yield benefits to the citizens of both countries, our neighbors, and the world. To realize this progress and these benefits, we seek to ensure that the relationship is not defined by strategic rivalry, but by fair and healthy competition, by practical cooperation on priority issues, and by constructive management of our differences and disagreements. Where interests overlap, we will seek to expand cooperation with China. These areas include economic prosperity, a denuclearized Korean Peninsula, peaceful resolution of the Iranian nuclear issue, and a reduction in the emission of greenhouse gases. Where they diverge – and we have significant and well-known areas of disagreement – we will work to ensure that our differences are constructively managed. Mr. Chairman, there are those who argue that cold war-like rivalry is inevitable and that the United States and China are condemned to a zero-sum struggle for supremacy, if not conflict. I reject such mechanistic thinking. As anyone who has served in government can tell you, this deterministic analysis overlooks the role of leaders who have the ability to set policy and to shape relationships. It gives short shrift to the fact that our two economies are becoming increasingly intertwined, which increases each side’s stake in the success of the other. It undervalues the fact that leaders in Washington and Beijing are fully cognizant of the risk of unintended strategic rivalry between an emerging power and an established power and have agreed to take deliberate actions to prevent such an outcome. And it ignores the reality of the past 35 years – that, in spite of our differences, U.S.-China relations have steadily grown deeper and stronger – and in doing so, we have built a very resilient relationship. We view China’s economic growth as complementary to the region’s prosperity, and China’s expanded role in the region can be complementary to the sustained U.S. strategic engagement in the Asia-Pacific. We and our partners in the region want China’s rise to contribute to the stability and continued development of the region. As President Obama and Secretary Kerry have made very clear, we do not seek to contain China; to the contrary, we welcome the emergence of a stable, peaceful, and prosperous China. We believe all countries, and particularly emerging powers like China, should recognize the self-benefit of upholding basic rules and norms on which the international system is built; these are rules and norms which China has participated in formulating and shaping, and they are rules and norms that it continues to benefit from. In this context, we are encouraging China to exercise restraint in dealing with its neighbors and show respect for universal values and international law both at home and abroad.

No US-China war – nuclear deterrence and geography mean that despite tensions, conflict would never eruptKeck, international relations and defense writer, 13

[Zachary, 7/12/13, The Diplomat, “Why China and the US (Probably) Won’t Go to War,” http://thediplomat.com/2013/07/why-china-and-the-us-probably-wont-go-to-war/, accessed 7/1/14, TYBG]But while trade cannot be relied upon to keep the peace, a U.S.-China war is virtually unthinkable because of two other factors: nuclear weapons and geography. The fact that both the U.S. and China have nuclear weapons is the most obvious reasons why they won’t clash, even if they remain fiercely competitive. This is because war is the continuation of politics by other means, and nuclear weapons make war extremely bad politics. Put differently, war is fought in pursuit of policy ends, which cannot be achieved through a total war between nuclear-armed states. This is not only because of nuclear weapons destructive power. As Thomas Schelling outlined brilliantly, nuclear weapons have not actually increased humans destructive capabilities. In fact, there is evidence to suggest that wars between nomads usually ended with the victors slaughtering all of the individuals on the losing side, because of the economics of holding slaves in nomadic “societies.” What makes nuclear weapons different, then, is not just their destructive power but also the certainty and immediacy of it. While extremely ambitious or desperate leaders can delude themselves into believing they can prevail in a conventional conflict with a stronger adversary because of any number of factors—superior will, superior doctrine, the weather etc.— none of this matters in nuclear war. With nuclear weapons, countries don’t have to prevail on the battlefield or defeat an opposing army to destroy an entire country, and since there are no adequate defenses for a large-scale nuclear attack, every leader can be absolute certain that most of their country can be destroyed in short-order in the event of a total conflict. Since no policy goal is worth this level of sacrifice, the only possible way for an all-out conflict to ensue is for a miscalculation of some sort to occur. Most of these can and should be dealt by Chinese and the U.S. leaders holding regularly senior level dialogues like the ones of the past month, in which frank and direct talk about redlines are discussed. These can and should be supplemented with clear and open communication channels, which can be especially useful when unexpected crises arise, like an exchange of fire between low-level naval officers in the increasingly crowded waters in the region. While this possibility is real and frightening, it’s hard to imagine a plausible scenario where it leads to a nuclear exchange between China and the United States. After all, at each stage of the crisis leaders know that if it is not properly contained, a nuclear war could ensue, and the complete destruction of a leader’s country is a more frightening possibility than losing credibility among hawkish elements of society. In any case, measured means of retaliation would be available to the party wronged, and behind-the-scenes diplomacy could help facilitate the process of finding mutually acceptable retaliatory measures. Geography is the less appreciated factor that will mitigate the chances of a U.S.-China war, but it could be nearly as important as nuclear weapons. Indeed, geography has a history of allowing countries to avoid the Thucydides Trap, and works against a U.S.-China war in a couple of ways. First, both the United States and China are immensely large countries—according to the Central Intelligence Agency, the U.S. and China are the third and fourth largest countries in the world by area, at 9,826,675 and 9,596,961 square km respectively. They also have difficult topographical features and complex populations. As such, they are virtually unconquerable by another power. This is an important point and differentiates the current strategic environment from historical cases where power transitions led to war. For example, in Europe where many of the historical cases derive from, each state genuinely had to

worry that the other side could increase their power capabilities to such a degree that they could credibly threaten the other side’s national survival. Neither China nor the U.S. has to realistically entertain such fears, and this will lessen their insecurity and therefore the security dilemma they operate within. Besides being immensely large countries, China and the U.S. are also separated by the Pacific Ocean, which will also weaken their sense of insecurity and threat perception towards one another. In many of the violent power transitions of the past, starting with Sparta and Athens but also including the European ones, the rival states were located in close proximity to one another. By contrast, when great power conflict has been avoided, the states have often had considerable distance between them, as was the case for the U.S. and British power transition and the peaceful end to the Cold War. The reason is simple and similar to the one above: the difficulty of projecting power across large distances—particularly bodies of waters— reduces each side’s concern that the other will threaten its national survival and most important strategic interests. True, the U.S. operates extensively in China’s backyard, and maintains numerous alliances and partnerships with Beijing’s neighbors. This undeniably heightens the risk of conflict. At the same time, the British were active throughout the Western Hemisphere, most notably in Canada, and the Americans maintained a robust alliance system in Western Europe throughout the Cold War. Even with the U.S. presence in Asia, then, the fact that the Chinese and American homelands are separated by the largest body of water in the world is enormously important in reducing their conflict potential, if history is any guide at least. Thus, while every effort should be made to avoid a U.S.-China war, it is nearly unthinkable one will occur.

Recycling Solves ScarcityRare earth recycling is increasing now and solves scarcityClancy, Forbes staff writer, 14 [Heather, 2/25/14, Forbes, “Rare Earth Recycling Takes On New Luster,” http://www.forbes.com/sites/heatherclancy/2014/02/25/rare-earth-recycling-takes-on-new-luster/]One notable example is Honda’s move last year with Japan Metals & Chemicals (JMC) to start reusing rare earth substances in used nickel-metal hydride (NiMH) batteries in new ones —after announcing its intention to do so in 2012. The automaker is using molten salt electrolysis to pull the materials out of an oxide extracted from the batteries: removing about 80 percent of what’s in the original . Those substances are being supplied to a battery maker, which is using them for negative electrode materials in hybrid vehicle batteries. Belgian company Umicore actually made this commercially feasible even earlier than Honda. The company, which processes more than 350,000 tons of every year including industrial by-products, catalysts and end-of-life products, has a partnership with chemical company Rhodia that is also focused on NiMH. Rechargeable NiMH batteries are found in everything from cordless phones, toys and games to power tools to hybrid electric vehicles. There’s about 1 gram (0.03 ounces of rare earth stuff in an AAA battery and up to 2 kilograms (4 pounds, 6 ounces) in a hybrid EV battery. Lithium-ion batteries don’t have the same recovery potential. “In the short term, we think recycling will be one of the few rare earth plays with upward motion,” writes cleantech analyst Dallas Kachan, in his 2014 annual predictions blog. “Why? Much of the industry has been focused on new mines to meet growing demand for rare earths. But recycling of rare earths is gaining momentum quietly , and stands to accelerate in 2014 given the increasing costs of mining and cost and schedule overruns at high profile sites like Molycorp’s Mountain Pass California mine. Aside from Honda, two other big companies talking up rare earth recycling and recovery include Mitsubishi Electric (which is recovering them from air-conditioning compressors) and Veolia Environmental Services (which plans to begin recovering them from 15 million pounds of e-waste and lamps at a facility in West Bridgewater, Mass.) Rare earths are not just important for green technologies—such as thin solar panels that are hungry for tellurium or fuel cells that need platinum for their catalyst or wind turbine gearboxes—but also in smartphones and other mobile gadgets. According to the U.S. Environmental Protection Agency, recycling 1 million mobile phones could recover a tremendous volume of rare and precious metals: 50 pounds of gold, 550 pounds of silver, 20 pounds of palladium and 20,000 pounds of copper. Their circuit boards can also contain coltan, zinc, beryllium, the list goes on.

***China Exports DA

NEG

1NC ShellChina’s solar PV export market growing now- key to China’s economic growth- our evidence is predictiveEPS, Electronic Purchasing Strategies, 7-15-14

(July 15th, the premier news, information and data portal and resource center for buyers, sellers and suppliers of components, design, distribution, logistics, production and other services to the global electronics manufacturing industry “Domestic Suppliers Dominate Chinese Solar Inverter Market”, http://electronicspurchasingstrategies.com/2014/07/15/domestic-suppliers-dominate-chinese-solar-inverter-market/, accessed 7/16/14, LLM)

London —The Chinese photovoltaic (PV) solar inverter market grew by more than 100 percent in 2013, providing a huge boost to the country’s domestic supplier base, according to the latest report from IHS Technology (NYSE: IHS). The 10 largest suppliers in China 2013 were all domestic companies, and all benefited from explosive growth as the market expanded to nearly $800 million, up from $400 million in 2012. China’s PV inverter market is forecast to generate robust growth over the coming years and reach 18 gigawatts (GW) of annual shipments in 2018, up from 11 GW in 2013. Much of this growth will be driven by the increasing momentum of the distributed PV business. China’s push toward distributed PV has been to slow to get started, and IHS believes that actual installations fell significantly short of the 8 GW target that was set for 2013. Nonetheless, this increasingly important segment will be a key driver for growth. Furthermore, this shift toward smaller rooftop systems will spur the adoption of lower-power inverters. Inverters play an essential role in PV installations, converting the direct current (DC) electricity produced by solar panels into alternating current (AC) useful in power grids. These findings can be found in the report, “PV Inverter China Market Report – 2014,” from the Power & Energy service of IHS. International suppliers shut out For the second year in a row, no international suppliers appeared among the IHS ranking of the 10 largest PV inverter suppliers to China. However, domestic suppliers also faced problems of their own. Although China represents a huge opportunity for its own suppliers in terms of volume, low pricing caused by fiercely competitive local companies, highly complex business conditions and lengthy credit terms have either prevented them from succeeding in gaining a sizable share of the market, or forced them to concentrate on other regions.

Solar market export share is essential to energy security and economic growth- no risk of a link turn- Beijing leaders perceive it’s trueKaften, International Economic Analyst for PV Magazine, 2012

(Cheryl, May 7th, “Solar 'smackdowns' resume in reaction to China’s 5 year plan”, http://www.pv-magazine.com/news/details/beitrag/solar-smackdowns-resume-in-reaction-to-chinas-5-year-plan_100006652/#axzz37nG234Qo, accessed 7/18/14, LLM)

The growth of China’s solar sector during the past five-year cycle has catapulted the country to number one in production and international sales. A February 2012 report from the People’s Republic (PRC) touted the finding that, by last year, China’s domestic solar industry accounted for more than 95 percent of total solar cell production worldwide. The report implies that,

without China’s aggressive growth policies, the international solar sector would not have advanced at nearly the same rate. "During the 11th Five-Year Plan period, China’s PV industry broke development bottlenecks in materials, markets, and human resource development. The size of the industry grew rapidly, and a complete upstream and downstream industrial chain was emerging," it states, adding, "The rise of China’s PV (photovoltaic) industry led the development of the global PV industry, effectively promoted technological progress, reduced costs of PV products, and accelerated industry application of PV around the world." Now, Beijing plans to do more of the same. In its 12th Five-Year Plan for the Solar Photovoltaic Industry (translated and analyzed by Wiley Rein LLP, a Washington, D.C.-based law firm), China acknowledges that, "from a global perspective, it will take some time before PV power generation becomes competitive in the market price-wise." Therefore, the PRC says that demand for solar systems should be driven "mainly by policy support and price subsidies provided to the PV industry by governments in all countries. The continued growth of the market will also facilitate expansion of the industry size and reduction in product costs." Beijing’s leadership team sees solar production and sales as a vital cornerstone of its economy – one that cannot and should not be compromised. "From the perspective of the strategic path of China’s social and economic development, promoting the solar PV industry is essential to guarantee energy supply, establish a low-carbon society, promote economic restructuring, and foster strategic emerging industries. During the 12th Five-Year Plan period, China’s PV industry will continue to maintain rapid development, facing great opportunities and formidable challenges."

Despite regime tactics of control, economic growth is key to prevent nationalism and CCP instabilityBarber, doctoral candidate at the University of Auckland, specializing in the history of international arbitration and the development of globalization, commerce, and trade, 6-10-14

(Christopher, “China: Wealth and Democracy Will Western levels of income mean that China adopts Western models of democracy?”, http://thediplomat.com/2014/06/china-wealth-and-democracy/, accessed 7/8/14, LLM)

The idea that the Communist Party will collapse and democracy will eventually triumph in China is a grave misreading of the

situation. The party stands as a harmonizing and unifying force in Chinese society – a far more important consideration for the middle class given the painful legacy of China’s historical fragmentation in the nineteenth and early twentieth

century. Indeed, it stands to reason that if the CCP succeeds in elevating China into the echelons of the high income bracket, then conversely it will act as a powerful legitimating device for the regime. If anything, Chinese nationalism serves as a far more popular discourse in mainstream society; whether it is populist anger at Japan or the huge

crowds that flock daily to watch the flag raising ceremony in Tiananmen Square. In terms of maintaining harmony, nationalism can be a double-edged sword for the CCP. Displays of patriotism can help to maintain unity and

assist in diverting the population’s attention from pressing domestic issues. Yet at the same time, zealous nationalism can be harmful to China’s international image and threaten to undercut its peaceful rise narrative. Nationalism, like all things in China, needs to be carefully stage managed in order to prevent it from causing social instability. Stage management and social stability are the keywords in the CCP’s lexicon of governance. Beijing is learning to account for its actions to its people. For instance, recent worries about the capital city’s rising levels of air pollution have made the authorities more aware of environmental matters. Policy changes aimed at dealing with the issue of air pollution demonstrate the ability of the government to shift resources in order to troubleshoot

popular issues. Thus, given the government’s sensitivity towards public opinion, considered political change

over the coming years or decades, depending on the boldness of party leadership, is quite likely. Whether this will take the form of an empowered National People’s Congress, more inclusive decision-making at the party level, or greater

democracy at the local level only time will tell. The CCP, though, is no house of cards; as Eric X. Li writes in Foreign Affairs, Beijing is

more than “able to meet the country’s ills with dynamism and resilience, thanks to the CCP’s adaptability, system of

meritocracy, and legitimacy with the Chinese people.” That in no way assures the CCP’s future survivability – as in any political system, changing socio-economic contexts invariably influences political regimes . But even if the regime loses its communist façade in place of a more democratic model, there is no suggestion that the elites or the “red nobility” that act as the invisible state will be displaced from positions of authority. Indeed, very few revolutions or changes to the status quo are quite as radical as people tend to think. Pragmatic elites invariably negotiate with the changing times so that it appears that the political arrangement has changed. Reform is easy, elitism and dynasty are much harder commodities to flush out of the system. The fact that China has a huge income inequality gap already shows that in the event of a post-communist meltdown

there will be elites ready to step into the breach – just like the oligarchs in Russia. Thus, the West should watch China’s political stability with a high degree of caution. While liberal political reforms are desperately needed to improve

the human rights situation in China, a radical rupture in the political system could signal an uncertain future for China and the world.

CCP instability triggers a nuclear civil war and regional conflicts that escalateYee, politics and international relations professor and Hong Kong Baptist University, and Storey, Defense professor at Deakin University, 2002 (Herbert and Ian, April 11th, 2002, Routledge publisher, “The China Threat: Perceptions, Myths and Reality”, pg 5, InformaWorld)

The fourth factor contributing to the perception of a China threat is the fear of political and economic collapse in the PRC, resulting in territorial fragmentation, civil war and waves of refugees pouring into neighbouring countries. Naturally, any or all of these scenarios would have a profoundly negative impact on regional stability. Today the Chinese leadership faces a raft of internal problems, including the increasing political demands of its citizens, a growing population, a shortage of natural resources and a deterioration in the natural environment caused by rapid industrialisation and pollution. These problems are putting a strain on the central government's ability to govern effectively. Political disintegration or a Chinese civil war might result in millions of Chinese refugees seeking asylum in neighbouring countries. Such an unprecedented exodus of refugees from a collapsed PRC would no doubt put a severe strain on the limited resources of China's neighbours. A fragmented China could also result in another nightmare scenario - nuclear weapons falling into the hands of irresponsible local provincial leaders or warlords.'2 From this perspective, a disintegrating China would also pose a threat to its neighbours and the world.

UniquenessThe solar market’s growing now and they are dominating, but rely exclusively on exports for successWillis, Energy Analyst for OFweek, 7-16-14’

(Ben, OFweek is a comprehensive web portal in China's high-tech industry with 1,000,000 members across various industries, “Domestic suppliers strengthen grip on booming Chinese inverter market”, http://global.ofweek.com/news/Domestic-suppliers-strengthen-grip-on-booming-Chinese-inverter-market-15012, accessed 7/17/14, LLM)

China’s PV inverter market grew more than 100% last year, with domestic firms dominating the top of the rankings, according to IHS. The market research firm’s ‘PV inverter China market report 2014’ said explosive growth in inverter sales in China last year saw revenues mushroom from US$400 million in 2012 to US$800 million. Chinese suppliers were the chief beneficiary of this, with the top 10 positions occupied entirely by domestic companies for the second year running. At the top of the list for the fourth consecutive year was Sungrow, which had 30% of the market share in 2013. The other top-five suppliers were TBEA Sunoasis, Emerson Network Power, Chint and KStar. But the fact each of these enjoyed less than 4% market share each IHS said illustrates the difficult business conditions faced by Chinese inverter manufacturers. “Low pricing caused by fiercely competitive local companies, highly complex business conditions and lengthy credit terms have either prevented them from succeeding in gaining a sizable share of the market, or forced them to concentrate on other regions,” IHS said. Nevertheless, IHS said burgeoning demand would generate robust growth in the Chinese PV inverter market in coming years, with shipments forecast to reach 18GW by 2018. Although utility-scale PV projects accounted for some 93% of inverter revenues last year, IHS said the distributed PV market would become increasingly important for inverter suppliers. China has set a target of 8GW of distributed PV for 2014. IHS said that although a slow start to the year meant probably only 4GW of that would get built, distributed systems would become an increasingly important market for inverter suppliers, prompting a shift to lower power inverters. “After several years of dramatic growth for huge ground-mount utility-scale projects in remote areas of the country, China has begun to place increased emphasis on the development of distributed rooftop solar in areas with high demand for electricity,” said Frank Xie, senior PV market analyst at IHS. This growing demand for smaller inverters will lead to changes to the PV inverter supplier rankings in 2014 and 2015, Xie added. “Although small string inverters will account for a growing share of the market, IHS forecasts that large central inverters will remain the mainstream for utility-scale PV systems in China due to their lower upfront cost and fewer connection points,” Xie concluded. “High power inverters are predicted to account for 80 percent of shipments to these systems in 2018.”

China’s solar PV export market growing now- key to China’s economic growth- our evidence is predictiveEPS, Electronic Purchasing Strategies, 7-15-14

(July 15th, the premier news, information and data portal and resource center for buyers, sellers and suppliers of components, design, distribution, logistics, production and other services to the global electronics manufacturing industry “Domestic Suppliers Dominate Chinese Solar Inverter Market”, http://electronicspurchasingstrategies.com/2014/07/15/domestic-suppliers-dominate-chinese-solar-inverter-market/, accessed 7/16/14, LLM)

London —The Chinese photovoltaic (PV) solar inverter market grew by more than 100 percent in 2013, providing a huge boost to the country’s domestic supplier base, according to the latest report from IHS Technology (NYSE: IHS). The 10 largest suppliers in China 2013 were all domestic companies, and all benefited from explosive growth as the market expanded to nearly $800 million, up from $400 million in 2012. China’s PV inverter market is forecast to generate robust growth over the coming years and reach 18 gigawatts (GW) of annual shipments in 2018, up from 11 GW in 2013. Much of this growth will be driven by the increasing momentum of the distributed PV business. China’s push toward distributed PV has been to slow to get started, and IHS believes that actual installations fell significantly short of the 8 GW target that was set for 2013. Nonetheless, this increasingly important segment will be a key driver for growth. Furthermore, this shift toward smaller rooftop systems will spur the adoption of lower-power inverters. Inverters play an essential role in PV installations, converting the direct current (DC) electricity produced by solar panels into alternating current (AC) useful in power grids. These findings can be found in the report, “PV Inverter China Market Report – 2014,” from the Power & Energy service of IHS. International suppliers shut out For the second year in a row, no international suppliers appeared among the IHS ranking of the 10 largest PV inverter suppliers to China. However, domestic suppliers also faced problems of their own. Although China represents a huge opportunity for its own suppliers in terms of volume, low pricing caused by fiercely competitive local companies, highly complex business conditions and lengthy credit terms have either prevented them from succeeding in gaining a sizable share of the market, or forced them to concentrate on other regions.

China has control of solar exports now and is looking to increase their solar market shareAyre, Geopolitical Analyst, University of Astnide, 7-6-14

(James, July 6th, “China Now The World’s Largest Solar PV Market”, http://cleantechnica.com/2014/07/06/china-now-worlds-largest-solar-pv-market/, accessed 7/16/14, LLM)

China is now the world’s largest solar PV market, according to the Global New Energy Development Report 2014, having now surpassed Germany to take the top spot. The new report explores other topics as well, and provides a comprehensive overview of the global renewable energy market. It was prepared by Hanergy Holding Group and China New Energy Chamber of Commerce. Amongst the most interesting things to note are that 38.7 GW of new solar PV capacity was installed in 2013, and that out of that total figure 12 GW was installed in China — that’s a 232% increase over the previous year in the eastern manufacturing powerhouse. Total global cumulative installed solar PV capacity now rests at 140.6 GW. The figures match up with

what has been predicted by many analysts, the industry’s slow shift from the European to the Asian market. The global new energy industry experienced sustained growth in 2013, as governments aligned their national energy mix to eliminate pollutants and improve the ecological environment, China New Energy Chamber of Commerce vice president Zeng Shaojun said. Chinese companies will be investing more heavily in technological advances and accelerate their pace of going global, in an effort to increase their shares in the global new energy market, Zeng added. Since 2012, Chinese regulators have been releasing a series of policies and measures, including the State Council’s Opinions on Promoting the Healthy Development of the PV industry, significantly propelling the development of the country’s solar power market. As of the end of 2013, China’s grid-connected solar capacity reached 14.79 GW, up 340% year on year. Over the last few years China’s PV export demand has fallen as the result of weak economic growth in the European and American markets, and also as the result of lower subsidies for exports to said markets + protectionist policies undertaken on behalf of those markets. 2013 was a bit of a turning point though, thanks to the country’s shift to emerging markets. Solar exports to Asia climbed 124% year on year in 2013 — up to $5.5 billion, thereby accounting for 44.8% of total exports. Another market that saw big growth was the African one, which saw figures surge 387% in 2013 — up to $570 million.

Competitiveness and exportability, especially in ocean energy, gain support for Xi’s push for renewables. Also, the size of China’s economy means the disad outweighs the case. Wheeler, Pro Vice-Chancellor (Sustainability) at the University of Plymouth and Dean of the Plymouth Business School, 2012

(David, November 7th, “But Will Barack Obama or Xi Jinping save the planet?”, Click Green, http://www.clickgreen.org.uk/opinion/opinion/123709-but-will-barack-obama-or-xi-jinping-save-the-planet.html)

While it is indeed welcome that the largest economy in the world (for now) is run by a President who appears determined to address the domestic risks of climate change, it was in Beijing that more decisive policies were being fashioned. For it is in China, not in the US, that rapid economic growth creates the most spectacular environmental risks and perhaps the greatest opportunities for innovation in sustainable energy, transportation and agriculture. ¶ In the run-up to the 18th National Congress of the Communist Party of China there was clear recognition of the momentous environmental challenges the world is facing, and the increasing responsibility of the world’s second largest economy to address those challenges.¶ According to the English language China Daily, official Party commentary acknowledged that “Problems have emerged in the country's economic development, including unreasonable energy consumption and environmental pollution, causing some to doubt whether the world can survive a China living an American lifestyle.” ¶ Popular unrest over environmental pollution continues to grow in China, with street protests successfully halting the $8.8bn expansion of a Sinopec petrochemical plant in Ningbo in October. Warnings are issued on a regular basis by state environmental protection agencies concerned about water, soil and air quality issues. Persistent photochemical smog

remains a serious environmental health issue in many of China’s largest cities. And Chinese scholars have estimated that the Chinese economy is incurring environmental costs as high as 8.9% of Gross National Income, compared to just 0.5% in Germany.¶ But things are changing fast. In China’s new Energy Policy 2012, released in late October, the State Council announced that China wants to cut CO2 emissions per unit of GDP by up to 45% by 2020 (compared to 2005 levels). The Chinese Government promises strong support for hydro-electricity, biomass, wind and solar energy generation. And – doubtless spotting a massive export opportunity for Chinese technology - China has signalled the resumption of its domestic nuclear power generation programme as part of a commitment to reach 15% non-fossil fuel electricity generation by 2020. ¶ In pursuing such a radical transformation in its energy mix, China is taking to heart the advice of business experts that supporting domestic markets for clean energy will enable China to compete globally in the development, sale and deployment of 21st century energy technology.¶ In a report for WWF released in June 2012: Clean Economy, Living Planet – The Race to the Top of the Global Cleantech Market, authors Arnoud van der Slot and Ward van den Berg of strategy consultants Roland Berger noted that by 2015, the ‘cleantech’ sector could be as large as €290 bn - up from €200 bn in 2011. Fastest growing suppliers to the global cleantech market in 2010/11 were Taiwan (+36% on the 2009/2010) and China (+29%). India and South Korea were tied at +19%.¶ But most telling of all is that China’s absolute sales of cleantech equipment (€57 bn in 2011), are now greater than both the EU (€47 bn) and the US (€37 bn). As a proportion of clean tech sales to GDP, at 1.7%, China is well placed between Denmark (1st) and Germany (3rd) in the ranking of economies focused on green manufacturing. Around half of these sales are wind and solar technology.¶ According to the WWF report, in 2011 seven of the world’s top 10 public flotations in cleantech industries were Chinese companies. And loan guarantees of more than $40bn were provided to seven Chinese companies in the solar energy business in the same year.¶ Given the continuing weakness of the European and US economies, and the massive investments in cleantech R&D being made by Chinese and South Korean businesses, there can hardly be any doubt that it will be East Asian businesses, and not European or American firms that will be dominating many cleantech growth opportunities in coming decades. The predicted $100bn per annum global ocean energy industry is one very obvious candidate as infrastructure moves offshore and where Chinese engineering strengths will supplement her leadership in wind technology.¶ As long ago as 1995, strategy guru Michael Porter wrote in the Harvard Business Review: “Successful environmentalists, regulatory agencies and companies will reject old trade offs and build on the underlying economic logic that links the environment, resource productivity, innovation and competitiveness.”

LinkReforms are key to transition to China’s economy and transition to renewablesSwanson, Chinese Political and Economic Analyst for the Wall Street Selector, 2012

(Ryan, “Can Xi Jinping Tackley China’s Energy Challenges”, March 26, Wall Street Sector Selector, http://wallstreetsectorselector.com/2012/03/can-xi-jinping-tackle-chinas-energy-challenges-part-two-fxi-chie-gex-ung-kol/#)

Many are asking what China’s once-in-a-decade leadership change will mean for China (NYSEARCA:FXI) and the world. As the affable and liberal Xi Jinping prepares to become China’s next president, diplomats and leaders of Western nations are eager to push for reforms within China, ranging from human rights to monetary policy to economic restructuring. Perhaps a more important question

to ask, however, is how a new Politburo Standing Committee—the nine-person committee of highest authority in

China’s central government—might shape China’s energy policy (NYSEARCA:CHIE) in the coming decade.

Indeed, most of China’s energy challenges (NYSEARCA:CHIE) are institutional rather than technological, and China’s new leadership may be up to the task of long-awaited reform .¶ Unlike Hu Jintao who first visited the US in 2002, Xi Jinping has made numerous trips to the US since his first visit in 1985. His daughter attends Harvard University, his sister lives in Canada, and he openly expresses a fondness of US war movies; furthermore, Xi is known for staying

clean in a notoriously corrupt political system. All of these traits have encouraged analysts that Xi may be able to resolve China’s political economic contradictions: to fully transition China from a centrally-planned to a market-based economy, from an agrarian to a post-industrial society. These impartial transitions have characterized China’s state capitalism, where state-owned enterprises wield tremendous monopolies and labor

remains cheap, but the growth model has not come without costs. Serious financial imbalances, environmental degradation, and international trade disputes have prompted Chinese officials to consider slowly steering the enormous juggernaut in a new direction.¶ Earlier this month, the World Bank released a 448-page report titled “China 2030: Building a Modern, Harmonious, and Creative High-Income Society,” offering numerous and complex policy recommendations—essentially a prescription for China to strengthen its private sector and complete

its transition to a market economy. Green development (NYSEARCA:GEX) received significant attention in the report as well as the energy policy reforms necessary for China to forge a path of low carbon development. Distilling the report’s findings into simplest terms, China’s heavy reliance on command-and-control operations, as opposed to market-based mechanisms, has led to resource allocation inefficiencies and market distortions. These inefficiencies and distortions have and continue to hinder China’s transition to an economy based on alternative energy sources, such as wind (NYSEARCA:FAN) solar (NYSEARCA:TAN) and shale gas (NYSEARCA:UNG).¶ On page 264, the World Bank report explains:¶ “At present, there is still not a

level playing field for investment in emerging industries. In the case of the wind turbine and solar PV industries,

for example, private companies are mainly concentrated in equipment manufacturing, while state-owned enterprises (SOEs) continue to monopolize the electricity generation market. State-owned enterprises also dominate the development of shale gas, which will continue to be non-competitive so long as the legal rights to shale gas resources are not clearly defined.”

A new coordinated renewable energy policy in the US would be zero-sum, and green tech exports are key to China’s economic growthRichardson, former Asia editor of the International Herald Tribune, is a visiting senior research fellow at the Institute of South East Asian Studies in Singapore, 2011

(Michael, “China’s Green Ambition, US Sees Red”, http://yaleglobal.yale.edu/content/chinas-green-ambition-us-sees-red, accessed 7/17/14, LLM)

But America needs a more coordinated approach if it’s to compete with China in clean-energy manufacturing and exports. A study published by the Harvard Kennedy School’s Belfer Center found that, unlike industrialized countries, China and most other major emerging economies coordinate and support energy R&D through government-owned enterprises. The study covered Brazil, China, India, Mexico, Russia and South Africa. By some estimates, investments in renewable-energy assets may total US$2.3 trillion by 2020, yielding increased jobs and exports as well as reduced greenhouse gas emissions, for countries that harness green technology.

On 7 December, frustrated US Commerce Secretary Gary Locke told the first meeting of the task force that China pumps almost US$12 billion monthly into its renewable-energy sector: “They’re doing this because they really want to be the world’s supplier of clean energy and they recognize this will support millions of jobs.”

China’s rise in key sectors of the green-energy business has been breathtaking. In 1999, China made around 1 percent of the photovoltaic cells put into solar panels to generate electricity. A decade later it’s the world’s leading producer, with a 40 percent share of the market.

Firms in China are expected to make more than half of all solar panels manufactured this year and nearly 80 percent of solar hot-water units. The nation’s also on course to produce nearly half the world’s wind-power turbines, selling them at prices significantly lower than those of manufacturers in the West and preparing for large-scale exports.

The US needs a more coordinated approach

if it’s to compete with China in clean-energy manufacturing and exports.

If China becomes a green-power export juggernaut, it will consolidate its lead in global high-technology sales, leaving the US well behind. In 1998, the US share of worldwide high-tech exports was nearly 25 percent while China’s was less than 10 percent. By 2008, China’s share was 20 percent, with America’s below 15 percent.

Leadership in clean-energy manufacturing is shifting from the West to Asia. Within the Group of 20 leading economies, China, India, Japan and South Korea are projected to account for approximately 40 percent of clean-energy investments in 2020, leaving the US and Europe trailing.

A recent survey by Bloomberg, in collaboration with the UN Environment Program, found that China became the largest recipient of renewable-energy financing in 2009, attracting more than 20 percent of the US$162 billion invested worldwide in wind, solar, biomass, small hydro, biofuel and marine energy.

While such investment in China grew by 53 percent, it shrank in the US by 45 percent. The US exported at least $2 billion of solar, wind, biomass, geothermal, hydropower and other renewable-energy products in 2009, almost double the sum in 2007. But it ran a trade deficit in

the combined sectors, with imports of wind-power equipment alone amounting to more than $3.6 billion.

If China becomes a green-power export juggernaut, it will consolidate its lead in global high-technology sales, leaving the US well behind.

Reasons given for the West’s decline and China’s rise are a new source of friction in Sino-US relations. Both Washington and Beijing consider the clean-technology sector crucial to energy security and economic growth. However, renewable-energy companies in the US struggle to find investments. They’ve cut jobs and, in some cases, moved operations to China.

Solar market is essential to energy security and economic growth- no risk of a link turn- Beijing leaders perceive it’s trueKaften, International Economic Analyst for PV Magazine, 2012

(Cheryl, May 7th, “Solar 'smackdowns' resume in reaction to China’s 5 year plan”, http://www.pv-magazine.com/news/details/beitrag/solar-smackdowns-resume-in-reaction-to-chinas-5-year-plan_100006652/#axzz37nG234Qo, accessed 7/18/14, LLM)

The growth of China’s solar sector during the past five-year cycle has catapulted the country to number one in production and international sales. A February 2012 report from the People’s Republic (PRC) touted the finding that, by last year, China’s domestic solar industry accounted for more than 95 percent of total solar cell production worldwide.

The report implies that, without China’s aggressive growth policies, the international solar sector would not have advanced at nearly the same rate. "During the 11th Five-Year Plan period, China’s PV industry broke development bottlenecks in materials, markets, and human resource development. The size of the industry grew rapidly, and a complete upstream and downstream industrial chain was emerging," it states, adding, "The rise of China’s PV (photovoltaic) industry led the development of the global PV industry, effectively promoted technological progress, reduced costs of PV products, and accelerated industry application of PV around the world."

Now, Beijing plans to do more of the same. In its 12th Five-Year Plan for the Solar Photovoltaic Industry (translated and analyzed by Wiley Rein LLP, a Washington, D.C.-based law firm), China acknowledges that, "from a global perspective, it will take some time before PV power generation becomes competitive in the market price-wise."

Therefore, the PRC says that demand for solar systems should be driven "mainly by policy support and price subsidies provided to the PV industry by governments in all countries. The

continued growth of the market will also facilitate expansion of the industry size and reduction in product costs."

Beijing’s leadership team sees solar production and sales as a vital cornerstone of its economy – one that cannot and should not be compromised. "From the perspective of the strategic path of China’s social and economic development, promoting the solar PV industry is essential to guarantee energy supply, establish a low-carbon society, promote economic restructuring, and foster strategic emerging industries. During the 12th Five-Year Plan period, China’s PV industry will continue to maintain rapid development, facing great opportunities and formidable challenges."

Solar PV market key to sustainable Chinese economic growthCaoa School of Economics and Management, Tsinghua University, Beijing, and Groba, German Institute for Economic Research, Mohrenstrasse Berlin, 2013

(Jing, Felix, “Chinese Renewable Energy Technology Exports: The Role of Policy, Innovation and Markets”, http://www.diw.de/documents/publikationen/73/diw_01.c.414422.de/dp1263.pdf, accessed 7/17/14, LLM)

Since 1990, China’s economic growth and export performance has been exceptional. The rapid growth in energy consumption and carbon emissions makes China a decisive player in global climate negotiations. In attempting to create more sustainable growth, China has introduced various policies designed to increase its renewable energy generation capacity and to establish an industrial base for clean technology production. With respect to the latter, China is particularly successful as its clean technology industry experienced a remarkable development. The solar photovoltaic (PV) module producing industry, including companies like Suntech, JA Solar and Yingli, is extremely prosperous with double digit growth rates since 2000 (REN21, 2011, IEA, 2010). After producing only 3 MW in 2000, China’s solar PV panel industry became the largest global producer, making 10,852 MW in 2010, which accounted for 45 percent of world production in 2010 (Algieri et al., 2011, EPI, 2011). China’s wind turbine production also experienced a similar rapid growth. Companies such as Sinovel, Goldwind, Dangfang and Ming Yang increased their production from USD 26 million in 2003 to USD 104 million in 2005, building a supply capacity of 17 gigawatt; some 41 percent of the global market (Caprotti, 2009, BTMConsult, 2011). At the same time, the Chinese government increased its efforts to close a knowledge gap to developed countries by increasing its research and development (R&D) spending on renewable energies and energy efficiency as well as by introducing numerous policies to support indigenous innovation and attract foreign knowledge. Yet, as this paper will highlight that the local market for renewable energy technologies components in China remained small until recently, with electricity generation from renewable sources contributing

only a marginal share to total electricity generation. Consequently, the largest share of solar PV and wind energy equipment production is exported - to only a few high-income countries – and China became the largest exporter of solar PV modules and a major exporter of wind energy technology components (WETC).

The plan trades off with China’s leadership of renewable energy exports and development – it’ll collapse the CCP and turns caseDenlinger 10

(Paul, China markets and technology consultant for Forbes, “Why China Has To Dominate Green Tech”, Forbes, July 20, http://www.forbes.com/sites/china/2010/07/20/why-china-has-to-dominate-green-tech/)

China just passed a new milestone: it consumes more energy than the United States, which had been the world leader ever since energy consumption started to be measured. Twenty years ago, such a milestone would have been marked with

unabashed pride, but in today’s energy-conscious world, it is not a good threshold. From now on, when it comes to global warming, pollution and related issues, China will no longer be able to hide behind its claims of being a

developing nation. On the policy level, the Chinese government has to perform a delicate balancing act, it has to balance the desire of many Chinese to live a Western lifestyle, together with its high energy consumption and waste, with the

need to preserve the environment, since China, and the world, would suffer enormous damage if 1.3 billion people got all their energy needs from coal and oil, the two most widely used fossil fuels. China’s political and social stability depends on finding the right balance, since the party has an implicit mandate :

it will deliver economic growth to the Chinese people. This is why the Chinese government has chosen to invest in developing new green energy technology. The country is very fortunate in that most of the discovered deposits of rare earths used in the development of new technologies are found in China. While these deposits are very valuable, up until recently, the industry has not been regulated much by the Chinese central government. But now that Beijing is aware of their importance and value, it has come under much closer scrutiny. For one, Beijing wants to consolidate the industry and lower energy waste and environmental damage. (Ironically, the rare earth mining business is one of the most energy-wasteful and highly polluting

industries around. Think Chinese coal mining with acid.) At the same time, Beijing wants to cut back rare earth exports to the rest of the world, instead encouraging domestic production into wind and solar products for export around the world. With patents on the new technology used in manufacturing, China would control the intellectual property and licensing on the products that would be used all over the

world. If Beijing is able to do this, it would control the next generation of energy products used by the world for the next century. That is the plan. It would be like if the oil-producing nations in the 1920s and 1930s said that they didn’t need Western oil exploration firms and refineries to distribute oil products; they would do all the processing themselves, and the Western countries would just order the finished oil products from them. This is how China obviously plans to keep most of the value-added profits within China’s borders. Before any Western readers snap into “evil Chinese conspiracy to take over the world” mode, it’s worth pointing out that Chinese rare earth experts and government officials have repeatedly warned Western visitors that this policy change would be introduced. Unfortunately, these warnings have gone largely unheeded and ignored by the Western media and politicians who, it seems, have been largely preoccupied by multiple financial crises and what to

do about the West’s debt load. The debt crisis in the West means that it is very hard for Western green energy companies to find financing for their technologies, then to market them as finished products. New energy technologies are highly risky, and initial investments are by no means guaranteed. Because they are considered high-risk and require high capital expenditure (unlike Internet technologies which are

very cheap and practically commoditized), banks are reluctant to finance them unless they are able to find government-secured financing. Because most U.S. banks are recapitalizing their businesses after the debt bubble burst, there are

very few, if any western banks who will finance new green energy technologies. This has opened a window of

opportunity for the Chinese government to finance, and for Chinese technology companies to develop, then manufacture these new green products. But just making these technologies is not enough; they need to be competitive against traditional fossil fuels. When it comes to the amount of energy released when coal or oil is burned, the new green technologies are still way behind. This means that, at least in the early stages of adoption, Chinese businesses will still be reliant on coal and oil to bridge that energy chasm before the new energy

technologies become economically competitive. Much depends on how much the Chinese government is willing to spend to promote and incentivize these new technologies, first in China, then overseas. Because of China’s growing energy demands, we are in a race for survival. The 21st century will be remembered as the resurgent coal and oil century, or as the century humanity transitioned to green technologies for energy consumption. While China is investing heavily now in green tech, it is still consuming ever larger amounts of coal and oil to drive its economic growth. Right now, we all depend on China’s success to make the transition to green energy this century. For all practical purposes, we’re all in the same boat.

Perception of energy containment causes regional lashout to appease hardlinersKreft, Ambassador and Special Representative for Dialogue among Civilizations and Public Diplomacy at the German Foreign Ministry, 2006

(Heinrich, “China’s Quest for Energy”, Policy Review, October 1, http://www.hoover.org/publications/policy-review/article/7941)

If energy issues are not dealt with by constructive cooperation, or if cooperation fails, the risk is high that they will become a source of competition, misperceptions, mistrust, and excuses for obstructing one another’s interests. If Beijing believes that the U.S. and others are trying to use energy politics as a means to contain China, then it should not be surprising that it will be trying to use its growing energy influence to undermine Western foreign and security policies. This could include increasing “hoarding” of oil and gas fields and supplies, even closer ties to and ever more investments in pariah states, the promotion of security cooperation with anti-Western governments, and possibly a politization of global energy markets. Such an environment could very well increase the influence of hard-liners within the Chinese leadership who perceive the U.S. as a threat to China’s rise and want to increase military strength — and in particular develop blue water capabilities in order to challenge the U.S. control of the sea lanes of communications through which China’s growing imports of oil (and LNG) are flowing — and generally decrease American influence in the region. Such a move would greatly concern other Asian powers from Japan and South Korea in Northeast Asia, over the ASEAN countries in the Southeast, to India in South Asia. Not only an arms race, but a wide range of negative outcomes could be imagined.

Internal LinksGrowth key to prevent CCP instability- causes internal chaos, war over the East and South China Seas, and Taiwan Zegart, co-director of Stanford University’s Center for International Security and Cooperation and a senior fellow at the Hoover Institution, 2014

(Amy, June 20th, “Should the US Be Bullish or Bearish on China’s Rise?”, http://www.the-american-interest.com/articles/2014/06/20/should-america-be-bullish-or-bearish-on-chinas-rise/, accessed 7/8/14, LLM)

Peering within, though, we see a fragile China. This is scary, too. China spends more money on its internal security than it does on defense. The regime, above all, has to worry about defending itself from its own people. As many have noted, China’s leadership faces a serious dilemma: If economic growth slows, its primary pillar of legitimacy may start to crumble . On the other hand, if growth continues, the political system will likely need to be reformed to deal with profound economic and social changes that include a rapidly aging population that is a ticking demographic time bomb; a severe inequality gap, particularly between rural and urban areas; rampant environmental degradation; widespread corruption; and weak central control over provincial and local governments. Today, already half a billion “netizens” are on the internet discussing topics that were unthinkable even a few years ago. Time, it appears, is not on the regime’s side. What does all of this mean for U.S. foreign policy? Three things. First, American policymakers would be wise to anticipate the prospect of instability in China. China’s rise is less inevitable than it appears, and the Chinese Communist Party’s stability is more tenuous than it seems. China’s domestic weakness could ultimately prove more destabilizing and dangerous externally than its current strength; the tried and true strategy to shore up support at home is to stoke nationalism by demonizing and engaging enemies abroad. Vladimir Putin’s recent moves in Ukraine illustrate all too well the risks of this dangerous mix of domestic politics and foreign policy, and the difficulty of inoculating even nascent democratic societies from its effects. In particular, if China’s rise sputters, territorial disputes over who has sovereignty in the East and South China Seas are likely to grow worse, not better. And that’s to say nothing of the future of Taiwan.

Slowing growth would cause massive ethnic unrest and collapse the CCP. Growth now is also key to continued economic and political liberalization and checking nationalism.Croucher, business and financial analyst for International Business Time UK, 6-4-14

(Shane, June 4, 2014, “Tiananmen Square 25th Anniversary: Can Prosperity and Xi Jinping Reforms Prevent 'China Spring'?, http://www.ibtimes.co.uk/tiananmen-square-25th-anniversary-can-prosperity-xi-jinping-reforms-prevent-china-spring-1451099)

A quarter of a century on from the Tiananmen Square massacre, everything and nothing has changed in China. When the students took to the square in demonstrations that spread across the vast Asian state before they were murderously quelled by the authorities, the angry youth-led movement was demanding a democratic and prosperous future.

China is scarcely more democratic now than it was on 4 June, 1989. But it is increasingly prosperous. The world's second largest economy and soon to be the biggest, China is seeing rapid growth in wealth and incomes. There has been a

proliferation of billionaires and the West looks lustfully at their bulging wallets. Even the agricultural poor are gradually

being lifted out of poverty as the magnet of urbanisation pulls them in to sprawling cities. And to show the masses that the Communist Party of China is committed to change, President Xi Jinping unveiled sweeping reforms to the Chinese economic, financial and social system. Yet there is still much dissent. The Chinese secret police and security services have managed to keep a lid on this boiling soup of discontent. It occasionally spills out in the provinces with protests and acts of civil disobedience, sometimes against the endemic local corruption

in China's bloated bureaucracy, sometimes over ethnic tensions. These fractured, localised disputes have not yet morphed into a national movement. On Weibo, China's answer to Facebook and Twitter, grumbling and criticism is

allowed about such issues. But state censors stand sentry, deleting any posts that attempt to arrange protest meetings. As China embraces greater trade and financial ties with the West; as the pistons of industrialisation thunder on; as the political elite promise reforms – is all this enough to prevent another Tiananmen? China's reaction to

the 25th anniversary of the massacre – an event not officially recognised – suggests the authorities are still fearful of the power of the protestors' message. "As in previous years, they rounded up activists and lawyers. What surprised us is how soon they started this time and the incredible scope and depth of the people they have been cracking down on," William Nees, a Hong Kong-based China researcher for human rights organisation Amnesty International, tells IBTimes UK. "What we are seeing

really is one of the largest crackdowns, certainly Tiananmen-related crackdowns, in recent years." China's leadership faces a troubling paradox. To justify itself, the system and those who control it need increasing economic prosperity for the masses. But the better off Chinese people become, the greater the political and social

freedom they will demand. Jinping reforms There was a big announcement at the conclusion of a four-day conclave of the

ruling Communist Party's leaders in November 2013. An agenda for reform in China was unveiled. Bringing

China into the twenty-first century is a focus of Jinping, who took office in Mach 2013. He has promised "market forces" will be central to China's future. Under the reforms Jinping will steward, China will scythe through its tangling red tape, make it easier for foreign firms to invest, loosen the rules around its one child policy, abolish the labour camp system, and crack down on the rotting influence of corruption, among

many other measures. Work is already underway to liberalise the tightly-controlled Chinese yuan, also known as

renminbi, with London vying to become the currency's Western hub for trading. Xi Jinping Xinjiang Terrorism China's President Xi JinpingReuters And Jinping is leading a vast crackdown on corruption in business, with a number of high-profile graft investigations, the most well-known of which surrounding British pharmaceuticals giant GlaxoSmithKline. "These reforms were necessary and something that we've been hoping to happen for some time," Dr Reza Hasmath, a China expert at the University of

Oxford, tells IBTimes UK. "The issue at hand here is that China's growth rate is actually decreasing and reforms

were something that had to be accomplished." Growth in the first quarter of 2014 slowed to 7.4% compared with 7.7% in the previous three months. And this is far slower than the 8.8% annual GDP growth reported in the same quarter a year before.

The government is consciously trying to stabilise Chinese economic growth from its current unsustainably rapid pace, which relies heavily on fiscal stimulus in areas such as infrastructure. "Usually there is a correlation between growth and discontent. And so when growth decreases we see a rise in discontent," says Hasmath. "The way you measure discontent is you see protests or grumblings on social media and so forth.

The party is acutely aware of this and so that's why they actually need to have other forms of growth." The regime wants a better-educated, urbanised population with an economy built more on service sector foundations. Its reforms programme will help this happen, but there is a risk to political stability

from the resulting inequality. "What you're going to find here is greater haves and have nots," Hasmath says. "And that's where the discontent is going to occur. The have nots are going to be in the rural areas . They're the ones the party needs to be quite aware of. Ironically enough, that's where the party's greater base has been from." Minzhu There

has already been a remarkable increase in disposable income for the Chinese after years of its growing trade with the rest of the world. The country's National Bureau of Statistics says it grew from 10,493 yuan ($1,734, £1,045, €1,270) in 2006 to 24,565 in 2012.

That is a 134% leap. And the Hurun Rich List said there were 314 dollar billionaires, up from none in 2013. If the latest reforms come off, they should further improve the lives of many Chinese citizens, who will become wealthier and more economically free. But there is noticeably little said in the reforms about arguably the single most-important freedom, minzhu – or democracy. Tiananmen Square Students protest on June 4, 1989, in Tiananmen SquareReuters China is still now, and will remain as, a one-party authoritarian state that allows little freedom of expression and

political dissent against the Communist Party hegemony. "They're hoping that their economic reforms will give them the prosperity needed to hold off political criticism. It's kind of worked so far. It's worked to an extent over the last 25 years, but most economists tend to agree that we'll see lower rates of economic growth," says Amnesty's Nees. "At the same time, a lot of the middle class – especially the upper-middle class – will be able to go abroad where you can of course access all sorts of free information, so the controls on ideology will be a lot less effective in future. "And I think a lot of people who have perhaps had much more basic demands in terms of being able to have a decent job and be able to eat – the demands you might associate with dire poverty – once those are more or less alleviated and addressed then people will start to deal with a more higher-level demand. "So there's fairness, and justice, and being able to practice their religious faiths without interference. I think these are different demands that are much harder for the government to address using their traditional

toolbox." Tibet and Xinjiang For the majority ethnic Hans, a healthy economy trumps political rights. So if the ruling party can keep the Asian powerhouse's engine running, it will likely drown out the threat to its governance by pro-democracy and human rights campaigners. But other ethnic groups, namely the Uighurs in Xinjiang province and the Tibetans, have not fared as well economically as the Hans. These tensions, building over time, are now exploding and are a concerning risk to the communists' rule. In one extreme example, around 200 people died in ethnic clashes in 2009 on the streets of Urumqi, Xianjing. They were ostensibly protesting against central government repression of Uighur religious and culture, but there is more than this fuelling the

unrest. "Ultimately, what you're finding here is that the Uighurs and Tibetans are not doing as well as Hans

are. And so they are turning to religion, to greater ethnic consciousness, and that kind of thing has flashed up in violence across these areas," the University of Oxford's Hasmath says. "There's religious repression of course, but these things are spurred on more by socio-economic reasons. The party realises this." The government is targeting economic support into these flashpoints in the hope that financial medicine will cure the social ills and so soften the political threat from different ethnic groups. "They're hoping and they're praying that you can actually target those ethnic groups who are not doing well, because that's one of the major reasons for

uncertainty," Hasmath says. Every so often, Chinese rulers will lift the lid off of the pot to stop it from boiling over. These little releases of pressure seem to be enough each time, but the fire keeping the pot hot

still burns in the longer-term. It will only take one lapse in attention for the pot to boil over. Unless they turn

the heat down with democratic reforms alongside the country's economic transformation, the prospect of another

Tiananmen Square uprising is more than just party officials' paranoia.

Chinese economic decline causes CCP collapseWeng, Associate Professor in the School of Diplomacy and International Relations at Seton Hall University, 2013

(Zheng September 4th, 2013, “How China’s Economic Rebalancing is like the Movie ‘Speed’”, The Diplomat, http://thediplomat.com/china-power/how-chinas-economic-rebalancing-is-like-the-movie-speed/, accessed 7/17/14 LLM)

How many remember the Hollywood film, Speed, starring Keanu Reeves and Sandra Bullock? In the movie, Reeves’ character must keep the Los Angeles bus he is driving above 50 miles per hour to prevent the bomb a disgruntled former bomb squad sergeant has planted from going off and killing everyone on board.

The Chinese economy is currently like that bus in that it must stay above a certain speed. To fall below a set national growth rate will set off the bomb that is attached to the Chinese economy.

Beijing sets a strict growth rate for its economy called the “red line” (hongxian). Under Premier Wen Jiabao, the red line was usually around 8 percent annual growth. Recently, however, this rate was lowered to 7.5 percent. Regardless if it is 8 or 7.5 percent, it is an unthinkably high rate for most countries in the world. Maintaining such a high speed is to prove especially difficult for China, though, given that it is now the world’s number two economy. Beijing is therefore playing a very dangerous game indeed.

In China, growth rates have never been solely an economic issue. The growth rate is closely related to employment, employment with social stability, and social stability with political stability. Given the social and political implications of the unemployment rate, and the fact that China is endowed with a massive population, it should not be surprising that the Chinese government considers maintaining robust employment as its number one priority.

Under Mao, and indeed through the middle of the 1980s, about 80 percent of China’s population lived in the countryside. Low living standards meant that many struggled for everyday survival, but they did not have as many social stability problems because people did not move around the country.

Since China’s reform and opening up policy was instituted, and Beijing joined the WTO, millions of Chinese have left the countryside for employment in cities along the more prosperous coast. Living in these cities also has raised people’s expectations for life and work, making it hard for them to fathom ever returning to the countryside to farm. An exodus back to the countryside is further complicated by the fact that many rural migrants in China have had their former land plots seized by Chinese authorities to make way for new highways, express train railways and giant factories.

So an economic slowdown in China today may generate social problems, such as unemployment, inflation, and social unrest. Only if China can maintain its high growth rate can it continue to meet the masses’ expectations for employment and living standards.

Despite regime tactics of control, economic growth is key to prevent nationalism and CCP instabilityBarber, doctoral candidate at the University of Auckland, specializing in the history of international arbitration and the development of globalization, commerce, and trade, 6-10-14

(Christopher, “China: Wealth and Democracy Will Western levels of income mean that China adopts Western models of democracy?”, http://thediplomat.com/2014/06/china-wealth-and-democracy/, accessed 7/8/14, LLM)

The idea that the Communist Party will collapse and democracy will eventually triumph in China is a grave misreading of the

situation. The party stands as a harmonizing and unifying force in Chinese society – a far more important consideration for the middle class given the painful legacy of China’s historical fragmentation in the nineteenth and early twentieth

century. Indeed, it stands to reason that if the CCP succeeds in elevating China into the echelons of the high income bracket, then conversely it will act as a powerful legitimating device for the regime. If anything, Chinese nationalism serves as a far more popular discourse in mainstream society; whether it is populist anger at Japan or the huge

crowds that flock daily to watch the flag raising ceremony in Tiananmen Square. In terms of maintaining harmony, nationalism can be a double-edged sword for the CCP. Displays of patriotism can help to maintain unity and

assist in diverting the population’s attention from pressing domestic issues. Yet at the same time, zealous nationalism can be harmful to China’s international image and threaten to undercut its peaceful rise narrative. Nationalism, like all things in China, needs to be carefully stage managed in order to prevent it from causing social instability. Stage management and social stability are the keywords in the CCP’s lexicon of governance. Beijing is learning to account for its actions to its people. For instance, recent worries about the capital city’s rising levels of air pollution have made the authorities more aware of environmental matters. Policy changes aimed at dealing with the issue of air pollution demonstrate the ability of the government to shift resources in order to troubleshoot

popular issues. Thus, given the government’s sensitivity towards public opinion, considered political change

over the coming years or decades, depending on the boldness of party leadership, is quite likely. Whether this will take the form of an empowered National People’s Congress, more inclusive decision-making at the party level, or greater

democracy at the local level only time will tell. The CCP, though, is no house of cards; as Eric X. Li writes in Foreign Affairs, Beijing is

more than “able to meet the country’s ills with dynamism and resilience, thanks to the CCP’s adaptability, system of

meritocracy, and legitimacy with the Chinese people.” That in no way assures the CCP’s future survivability – as in any political system, changing socio-economic contexts invariably influences political regimes . But even if the regime loses its communist façade in place of a more democratic model, there is no suggestion that the elites or the “red nobility” that act as the invisible state will be displaced from positions of authority. Indeed, very few revolutions or changes to the status quo are quite as radical as people tend to think. Pragmatic elites invariably negotiate with the changing times so that it appears that the political arrangement has changed. Reform is easy, elitism and dynasty are much harder commodities to flush out of the system. The fact that China has a huge income inequality gap already shows that in the event of a post-communist meltdown

there will be elites ready to step into the breach – just like the oligarchs in Russia. Thus, the West should watch China’s political stability with a high degree of caution. While liberal political reforms are desperately needed to improve

the human rights situation in China, a radical rupture in the political system could signal an uncertain future for China and the world.

Economic growth key to CCP and Chinese stability- it’s a delicate balancing actDenlinger, Chinese Market Consultant for Forbes, 2010

(Paul, July 10th, 2010, “Why China Has To Dominate Green Tech”, http://www.forbes.com/sites/china/2010/07/20/why-china-has-to-dominate-green-tech/, accessed 7/18/14, LLM)

China just passed a new milestone: it consumes more energy than the United States, which had been the world leader ever since energy consumption started to be measured. Twenty years ago, such a milestone would have been marked with unabashed pride, but in today’s energy-conscious world, it is not a good threshold. From now on, when it comes to global warming, pollution and related issues, China will no longer be able to hide behind its claims of being a developing nation.

On the policy level, the Chinese government has to perform a delicate balancing act, it has to balance the desire of many Chinese to live a Western lifestyle, together with its high energy consumption and waste, with the need to preserve the environment, since China, and the world, would suffer enormous damage if 1.3 billion people got all their energy needs from coal and oil, the two most widely used fossil fuels. China’s political and social stability depends on finding the right balance, since the party has an implicit mandate: it will deliver economic growth to the Chinese people.

This is why the Chinese government has chosen to invest in developing new green energy technology.

The country is very fortunate in that most of the discovered deposits of rare earths used in the development of new technologies are found in China. While these deposits are very valuable, up until recently, the industry has not been regulated much by the Chinese central government. But now that Beijing is aware of their importance and value, it has come under much closer scrutiny. For one, Beijing wants to consolidate the industry and lower energy waste and environmental damage. (Ironically, the rare earth mining business is one of the most energy-wasteful and highly polluting industries around. Think Chinese coal mining with acid.)

At the same time, Beijing wants to cut back rare earth exports to the rest of the world, instead encouraging domestic production into wind and solar products for export around the world. With patents on the new technology used in manufacturing, China would control the intellectual property and licensing on the products that would be used all over the world. If Beijing is able to do this, it would control the next generation of energy products used by the world for the next century.

That is the plan. It would be like if the oil-producing nations in the 1920s and 1930s said that they didn’t need Western oil exploration firms and refineries to distribute oil products; they would do all the processing themselves, and the Western countries would just order the finished

oil products from them. This is how China obviously plans to keep most of the value-added profits within China’s borders.

Before any Western readers snap into “evil Chinese conspiracy to take over the world” mode, it’s worth pointing out that Chinese rare earth experts and government officials have repeatedly warned Western visitors that this policy change would be introduced. Unfortunately, these warnings have gone largely unheeded and ignored by the Western media and politicians who, it seems, have been largely preoccupied by multiple financial crises and what to do about the West’s debt load.

The debt crisis in the West means that it is very hard for Western green energy companies to find financing for their technologies, then to market them as finished products. New energy technologies are highly risky, and initial investments are by no means guaranteed. Because they are considered high-risk and require high capital expenditure (unlike Internet technologies which are very cheap and practically commoditized), banks are reluctant to finance them unless they are able to find government-secured financing. Because most U.S. banks are recapitalizing their businesses after the debt bubble burst, there are very few, if any western banks who will finance new green energy technologies.

This has opened a window of opportunity for the Chinese government to finance, and for Chinese technology companies to develop, then manufacture these new green products. But just making these technologies is not enough; they need to be competitive against traditional fossil fuels. When it comes to the amount of energy released when coal or oil is burned, the new green technologies are still way behind. This means that, at least in the early stages of adoption, Chinese businesses will still be reliant on coal and oil to bridge that energy chasm before the new energy technologies become economically competitive. Much depends on how much the Chinese government is willing to spend to promote and incentivize these new technologies, first in China, then overseas.

Because of China’s growing energy demands, we are in a race for survival. The 21st century will be remembered as the resurgent coal and oil century, or as the century humanity transitioned to green technologies for energy consumption. While China is investing heavily now in green tech, it is still consuming ever larger amounts of coal and oil to drive its economic growth. Right now, we all depend on China’s success to make the transition to green energy this century.

For all practical purposes, we’re all in the same boat.

Impact - GeneralCCP instability triggers a nuclear civil war and regional conflicts that escalateYee, politics and international relations professor and Hong Kong Baptist University, and Storey, Defense professor at Deakin University, 2002 (Herbert and Ian, April 11th, 2002, Routledge publisher, “The China Threat: Perceptions, Myths and Reality”, pg 5, InformaWorld)

The fourth factor contributing to the perception of a China threat is the fear of political and economic collapse in the PRC, resulting in territorial fragmentation, civil war and waves of refugees pouring into neighbouring countries. Naturally, any or all of these scenarios would have a profoundly negative impact on regional stability. Today the Chinese leadership faces a raft of internal problems, including the increasing political demands of its citizens, a growing population, a shortage of natural resources and a deterioration in the natural environment caused by rapid industrialisation and pollution. These problems are putting a strain on the central government's ability to govern effectively. Political disintegration or a Chinese civil war might result in millions of Chinese refugees seeking asylum in neighbouring countries. Such an unprecedented exodus of refugees from a collapsed PRC would no doubt put a severe strain on the limited resources of China's neighbours. A fragmented China could also result in another nightmare scenario - nuclear weapons falling into the hands of irresponsible local provincial leaders or warlords.'2 From this perspective, a disintegrating China would also pose a threat to its neighbours and the world.

CCP instability causes chemical biological and nuclear war- causes extinctionRexing, Staff Reporter for the Epoch Times, 2005

(San, “The CCP’s Last Ditch Gamble: Biological and Nuclear War”, http://english.epochtimes.com/ news/5-8-5/30975.html)Since the Party’s life is “above all else,” it would not be surprising if the CCP resorts to the use of biological, chemical, and nuclear weapons in its attempt to extend its life. The CCP, which disregards human life, would not hesitate to kill two hundred million Americans, along with seven or eight hundred million Chinese, to achieve its ends. These speeches let the public see the CCP for what it really is. With evil filling its every cell the CCP intends to wage a war against humankind in its desperate attempt to cling to life. That is the main theme of the speeches.

This theme is murderous and utterly evil. In China we have seen beggars who coerced people to give them money by threatening to stab themselves with knives or pierce their throats with long nails. But we have never, until now, seen such a gangster who would use biological, chemical, and nuclear weapons to threaten the world, that all will die together with him. This bloody confession has confirmed the CCP’s nature: that of a monstrous murderer who has killed 80 million Chinese people and who now plans to hold one billion people hostage and gamble with their lives.

AT: Lower Prices

Lowering prices doesn’t prevent the link, it makes it worse. Central planning creates a lag between market prices and output prices.Swanson, Chinese Political and Economic Analyst for the Wall Street Selector, 2012

(Ryan, “Can Xi Jinping Tackley China’s Energy Challenges”, March 26, Wall Street Sector Selector, http://wallstreetsectorselector.com/2012/03/can-xi-jinping-tackle-chinas-energy-challenges-part-two-fxi-chie-gex-ung-kol/#)

The case of shale gas reflects broader institutional challenges facing China’s energy sector (NYSEARCA:CHIE). In the absence of free markets, the Chinese (NYSEARCA:FXI) central government uses pricing mechanisms to control the supply of coal (NYSEARCA:KOL), electricity, gas (NYSEARCA:UNG), and water—mechanisms which, according to the World Bank, must be reformed if robust green development (NYSEARCA:GEX) is to occur. Electricity prices, for example, do not reflect the cost of generation and transmission, rather they are set by the National Development and Reform Commission (NDRC) to comply with government policy and social goals. Different wholesale prices are set for different generation sources (i.e., coal, hydro, wind, and solar). Retail prices are also differentiated where rates for heavy industry, agriculture, and residents are heavily subsidized, while commercial and selected industrial customers pay much more.¶ Within these rigid pricing mechanisms, the most efficient and profitable power plants are not rewarded, as many are only allotted a set amount of operating hours per year. Analysts at E3, a San Francisco-based energy consulting firm, argue that given China‘s centrally-planned pricing and dispatch system, “it is not clear how natural gas plants (NYSEARCA:UNG), which typically have higher variability in operating hours and face highly volatile gas prices, would be able to recover their costs.” Thus, China’s(NYSEARCA:FXI) largely centrally planned electricity system hinders the introduction of natural gas power plants and frustrates private sector investment.¶ About a decade ago, China unbundled its State Power Corporation, a vertically-integrated electric utility monopoly, into generation, transmission, and distribution companies and founded the State Electricity Regulatory Commission (SERC) to regulate the electricity sector. One problem, though, is that SERC does not have the authority to act as an effective regulator, as the approval, planning, and ratemaking powers for the electricity sector reside in the NDRC, China‘s chief economic planning commission. State-owned enterprises, including the State Grid Corporation of China, are also more powerful than SERC, posing challenges to SERC‘s ability to enforce its own rules. In effect, despite China’s attempts to unbundle its monopoly and regulate, its electricity sector remains government owned and run with a powerless regulator.

AT: Co-Op

There’s no chance of cooperation on energy, nationalists and hardliners see US energy expansion as economic containmentDeLisle, Director of FPRI’s Asia Program, 2012

(Jacques and the Stephen Cozen Professor of Law and Political Science at the University of Pennsylvania, October of 2012, “Conference Report: Energy, Environment, and Security in Asia”, Foreign Policy Research Institute, October, https://www.fpri.org/articles/2012/10/conference-report-energy-environment-and-security-asia)

Despite the energy-related and broader foreign policy reasons for pursuing cooperation (including China’s desire to be seen as a responsible stakeholder in the international system), many formidable obstacles remain to U.S.-China collaboration on clean energy. The U.S.’s market-capitalist system and China’s state-capitalist systems do not mesh well in tackling many problems, including clean energy technology development. Mutual mistrust and genuinely conflicting interests characterize much of the political relationship and the upcoming U.S. election and Chinese leadership transition entail risks of increased misperception and provocation. Events and shocks often get in the way of potential collaboration: the Global Financial Crisis distracted policymakers from environmental issues and increased emphasis on growth by any means; the failure of the Copenhagen environmental conference scuttled near-term hopes for an international accord that would encourage green energy development; and recurrent frictions in U.S.-China relations generally (such as those over Tibet, arms sales to Taiwan, renminbi valuation, and sanctions on Iran) have posed chronic obstacles. Key clean energy sectors—including wind and solar—have been the loci of conflicts between China and the U.S., as well as Europe. For example, leading European companies in the wind power sector saw their market share in China plummet in favor of Chinese producers who had benefited from European cooperation and China’s new WTO-noncompliant domestic content requirements. For another example, solar power has made little headway in China’s domestic market even as Chinese firms have come to dominate the world market in solar panels, thanks partly to Chinese state support for producers and the U.S.’s and other developed states’ subsidies to support solar panel installation. China’s wind power and solar power policies have both become targets of WTO disputes targeting China. Rozman argued that the impediments to U.S.-China cooperation are still more fundamental and intractable. Fundamentally, China’s strategic thinking is based in its assessment that the international balance of power is shifting in its favor and against the United States. China’s approach reflects the impact of its geopolitical calculations and a national identity laced with strident nationalism. Although the fall of Bo Xilai as a potential member of the top leadership was a setback for relative hardliners in domestic politics and foreign policy (including relations with the U.S.), his political demise did not portend an end to the influence of such views. Even if the U.S. and China can avoid mutual demonization, the two countries have

genuine differences in priorities, including on matters that are related to or affect clean energy cooperation. In this context, prospects remained dim for transformative U.S.-China cooperation in a potentially sensitive issue area such as green energy.

AFF

UniquenessChinese import demand will fall while US and others will stay competitiveLin, Technology and Information Analyst, 6-26-14

(Corrine, June 26th, “Solar makers to expand production capacity; pricing to be affected by Chinese market demands”, http://pv.energytrend.com/research/20140626-6967.html, accessed 7/18/14, LLM)

Contrary to PV manufacturers’ high utilization rates spurred by UK and Japan market demands in first quarter of 2014, pricing in the PV industry is likely to drop in the following quarter, according to EnergyTrend, a subsidiary of Taiwan-based market intelligence firm TrendForce. The research organization attributed ongoing countervailing duty (CVD) and anti-dumping duty (AD) issues between U.S., China, and Taiwan as the main cause behind the decline, and noted PV shipments were mostly focused on the U.S. market, while shipments have eased in other markets.

Solar PV supply chains are starting to see demand in China whither, while demand in the U.S. and Japan remain stable, said EnergyTrend Research Manager Jason Huang. As such trends occur, solar supply chains are nevertheless expected to increase production capacity in the second half of 2014, which means Chinese market demands will play a major role in terms of global solar PV pricing and volume. If demands in China remain at around 10-12GW then manufacturers in the PV supply chain can balance out orders in conjunction with their new capacity. However, if Chinese market demands are lower than expected coupled with uncertainties surrounding CVD and AD issues, the PV market still risks oversupply and hence declined prices.

There’s no market demand for ChinaRen, Market Analyst for Emerging Market Daily, 5-15-14

(Shuli, May 15th, “China Solar: Policy Headwind, 1H Demand Collapse, Says Deutsche”, http://blogs.barrons.com/emergingmarketsdaily/2014/05/15/china-solar-policy-headwind-1h-demand-collapse-says-deutsche/, accessed 7/18/14, LLM)

Almost half way into 2014, there is little clarity on Beijing’s intentions with the solar industry.

Optimism was running high late last year, with analysts and industry insiders anticipating a 14GW target for 2014. But investors now realize the government’s goal of 6GW utility projects and 8GW distributed projects is unattainable, because there is not enough financing for the distributed projects.

Year-to-date, Yingli Green Energy (YGE) slumped 42%. Trina Solar (TSL) fell 22%. Jinko Solar (JKS) retreated 14.9%. Canadian Solar (CSIQ) fell 14.3%. JA Solar (JASO), the least leveraged among the Chinese solar names, fared the best, gaining 2.6%.

In the first half this year, demand has collapsed, according to a report published by Deutsche Bank today. Its analysts Vishal Shah, Jerimiah Booream-Phelps, and Susie Min estimate demand in China to have declined from around 6GW in the fourth-quarter last year to 1GW in the first quarter, and the Chinese solar companies they spoke to expect the second-quarter to reach 3-4GW only.

Demand from the distributed projects segment remains weak. None of the companies Deutsche spoke with expect distributed segment to reach the 8GW target. 2GW is a more realistic goal.

Demand will dry up now- overcapacity means the market will fail like in previous EU countriesZhu, Energy and Political Analyst for Reuters, 1-23-14

(Charlie, January 23rd, “China's solar industry rebounds, but will boom-bust cycle repeat?”, http://www.reuters.com/article/2014/01/23/us-china-solar-idUSBREA0M1VJ20140123, accessed 7/18/14, LLM)

(Reuters) - China's solar panel industry is showing signs of booming again after a prolonged downturn - raising fears of another bust when the splurge of public money that is driving a spike in demand dries up.

Lured by generous power tariffs and financing support to promote renewable energy, Chinese firms are racing to develop multi-billion dollar solar generating projects in the Gobi desert and barren hills of China's vast north and northwest.

The sweeteners have not only lured traditional energy investors like China Power Investment Corp, but also a host of solar panel makers and even companies such as toll road operator Huabei Express and Jiangsu Kuangda Auto Textile Group.

Some solar panel manufacturers, encouraged by a recovery in sales in the last two quarters - largely on surging demand from China and Japan - are expanding production capacity, even though the overall sector remains mired in a severe glut.

But industry officials worry fast-growing generation capacity will increase fiscal pressures on China and Japan and force them to cut subsidies which will then hit demand, just as happened with previous big solar users Germany, Spain and Italy.

"The key is whether the Chinese government is determined enough to boost solar generation," Sun Haiyan, senior executive at Trina Solar, said when asked if the current solar expansion in China was sustainable.

China already boasts solar manufacturing capacity of about 45 gigawatts (GW), enough to meet global demand this year.

Trina Solar, JinkoSolar, Yingli Green Energy and Canadian Solar - among the world's largest solar manufacturers that also include Japan's Sharp Corp and U.S. SunPower Corp - are adding 3 GW of capacity, according to industry specialists and Chinese media.

Beijing is trying to consolidate the sector and force out the legion of small "zombie plants" currently sitting idle, but analysts say it faces stiff resistance from indebted regional and city governments that have backed local solar champions.

Michael Barker, analyst at global solar research firm Solarbuzz, said a risk now faced by the solar panel industry was manufacturers may react to improved demand "with somewhat irrational exuberance".

"This could upset the stabilization process that has occurred during the past year, once again creating an overcapacity situation," he wrote in a note this week.

Link

Not key to growth, China makes virtually nothing from solar exportsMufson, Energy and Finance Analyst for the Washington Post, 2011

(Steven, December 16th, “China’s growing share of solar market comes at a price”, http://www.washingtonpost.com/business/economy/chinas-growing-share-of-solar-market-comes-at-a-price/2011/11/21/gIQAhPRWyO_story.html, accessed 7/18/14, LLM)

“Countries like China are playing to win in the solar industry,” Chu said.

“My big thing is that I worry about China,” said Rep. Brian P. Bilbray (R-Calif.).

“The Chinese are eating our lunch,” said Rep. John D. Dingell (D-Mich.).

Yet if Chinese solar companies are eating our lunch, they’re also choking on it. Growth in global solar manufacturing capacity is outpacing global demand, and prices of solar energy products are plunging. And while U.S. politicians portray Chinese firms as heavily subsidized rivals gobbling up global market share, Chinese solar companies are suffering from some of the same ills afflicting their U.S. competitors.

Some of China’s biggest companies are losing money, shelving capital expenditure plans and looking to conserve dwindling reserves of cash. To avoid going deeper into debt, they have borrowed only a tiny fraction of $34 billion in loans available to them from the China Development Bank.

For consumers, the cutthroat competition is a good thing. Wholesale solar panel prices have dropped as much as 50 percent this year, and retail prices are less than half what they were five years ago. Industry experts say that the day is near when solar can compete against other energy sources without subsidies. In certain places and at certain times of day, it’s already viable. Meanwhile, analysts say, if China wants to subsidize solar products, Americans can buy more of them.

For some U.S. companies, China’s expanding industry has meant more jobs. Cheap panels fuel greater sales — and installation accounts for more than half of U.S. solar industry jobs.

Moreover, the United States has a trade surplus with China in solar goods, led by exports of polysilicon, the raw material needed to make photovoltaic cells, which in turn are the building blocks for solar panels.

The United States also exports the solar manufacturing machinery. Applied Materials, which made its name in the semiconductor business, beat analysts’ expectations earlier this year thanks to sales of equipment for making solar cells. To promote sales, the Santa Clara, Calif., company has set up a research center in the Chinese city of Xian and moved its chief technology officer there. “Now we are doing for the green economy what we did for the Information Age,” the company says on its Web site.

GT Advanced Technologies, which sells furnaces and other equipment for making the polysilicon and ingots used in making solar cells, does 98 percent of its business in Asia, much of it in China. “We compete very effectively as a U.S.-based corporation in spite of the fact that my Chinese competitors sell at half my price,” said Tom Gutierrez, chief executive of the New Hampshire-based firm. “We beat them through technology and innovation.”

But U.S. solar panel manufacturers and people who believe that solar manufacturing can become part of a new “clean technology” economy are unhappy. They believe that the flood of Chinese solar cells is a textbook case of dumping — an economic term to describe when foreign companies overwhelm a market with cheap goods to drive competitors out of business. Later, after gaining control of that market, the foreign companies can jack up prices.

Chinese panels are selling for less than $1 a watt, while those made elsewhere sell for about 20 percent more, according to Bloomberg New Energy Finance.

China supplies nearly half of U.S. solar panel imports — 44.6 million units in the first eight months of the year, up from 3.8 million in 2008, according to an anti-dumping petition filed by a group of U.S. firms. Those sales rocketed to $1.69 billion through August of this year from $233.3 million in 2008.

The biggest of those panel makers, Suntech, promotes its products in ads that show two panels hooked up to an electric American flag. “Now Power America, from America,” the ad says, even though only 2 percent of Suntech’s manufacturing capacity is in the United States.

But volume doesn’t guarantee profits and for Chinese solar companies, it has been a painful rise to the top ranks of the global market. Suntech, JA Solar and LDK Solar, the top Chinese solar

panel makers, reported losses for the third quarter and warned investors the outlook was grim. JA Solar reported operating losses and a writedown on the value of its inventory. Suntech, which lost $116.4 million in the third quarter, said it expected shipments to drop 10 percent in the fourth quarter.

“This will be challenging for all solar companies,” Suntech chief executive Shi Zhengrong said during a conference call with investors in November. Many of China’s more than 100 solar cell firms and 300 solar module companies with lower-quality products could close down.

In addition, Chinese solar panel makers are facing possible tariffs as the U.S. International Trade Commission weighs charges in the dumping case. In a 6 to 0 vote Dec. 5, the ITC found a “reasonable indication” that Chinese imports are “materially injuring” the U.S. industry. It is considering whether to impose duties, and at what level.

In a Nov. 22 conference call about its quarterly earnings, JA Solar chief executive Fang Peng said the company might move some of its finishing operations to other countries, such as South Korea or Taiwan, so that its panels would not be considered imports from China. “To be prudent we need to have a work-around solution,” chief financial officer Min Cao said.

“China is not pricing its products to make money,” said Timothy Brightbill, a lawyer at Wiley Rein who is representing U.S. solar panel makers in the dumping case. “It’s pricing its products to try to dominate this market.”

Export demand low- US and EU tariffs- they’ll shift to domestic demandThe Economist, Authoritative International Politics and Business News, 2012

(December 7th, 2012, “China’s Solar Plans are Insane”, http://www.businessinsider.com/chinas-solar-plans-are-insane-2012-12, accessed 7/18/14, LLM)

China's bloated solar sector has been hard hit this year by plummeting prices brought on by overcapacity. Overseas demand, which absorbs most Chinese panels, is set to fall next year as tariffs are imposed and subsidies cut.

However, consolidation in solar manufacturing is not yet in the cards. Instead, the government is turning its attention to boosting domestic solar-power installations. At the same time, it is turning a blind eye to local governments' grandiose plans to ramp up production. As new-energy and high-tech activity remains a national priority, these plans are likely to come at least to partial fruition, exacerbating the problems suffered by the industry.

Most of the solar panels made in China are exported, with much of the demand coming from the US and Europe; the latter is expected to account for two-thirds of worldwide installed solar capacity this year. Global demand growth has been robust, with panel installations doubling in the US in both 2011 and 2012.

However, 2013 is likely to be different. US anti-dumping tariffs on solar-cell imports from China were finally approved in November, which will discourage purchases from Chinese companies. In early 2012 several EU countries, including Spain, cut subsidies for solar installations. To top it all, the EU began an anti-dumping investigation into Chinese solar exports in September, which may lead to further tariffs.

As the sector braces itself for the slump in external demand, officials are trying to accelerate development in the home market. China has already become the world's third-largest consumer of solar energy, up from seventh in 2010. Solar installed capacity ballooned from 537 mw in 2010 to 2.5 gw in 2011. As a result of the external slowdown, officials have brought forward the planned target of 21 gw from 2020 to 2015. In October local media reported that the State Grid, China's largest utility, plans to give local subsidiaries the power to approve plants with installed capacity of less than 10 mw. The National Energy Administration is reportedly considering a subsidy of Rmb0.4-0.6 per kwh of distributed solar power.

More, more, more

The pains taken to boost domestic absorption may prove a Sisyphean task, however, as local governments still have ambitious plans to ramp up production. The industry remains favoured, and is seen by local officials as an easy way to boost new-energy and high-tech development. Moreover, it spurs upstream activities, such as the production of polysilicon, a core component in solar panels.

The province of Shaanxi, which has large stores of polysilicon as well as a glitzy new solar research-and-development centre established by US-based Applied Materials, aims to raise solar industrial output to Rmb300bn (US$47.6bn) by 2015-a tenfold increase on 2011. By comparison, total Chinese exports to Europe were only worth Rmb223bn in 2011. Efforts to increase photovoltaic (PV) cell production in the north of the province, where several solar-power stations are under construction, have been substantial. The local five-year plan (2011-15) calls for expansion into equipment manufacturing.

Production in Chengdu, the provincial capital of Sichuan, is also expanding rapidly. In-November 2012 the prefecture announced that it had attracted Rmb6.45bn in planned investment for solar-manufacturing projects. Chengdu has maintained a target of Rmb100bn in industrial

capacity in new energy, with a focus on solar projects. In May the western region of Xinjiang released a five-year development plan targeting annual output of Rmb10bn from PV producers, and annual income growth of more than 70% from the PV industry.

Solar madness

Expanding production in western China will exacerbate the problems. This year solar panels with an estimated capacity of 59 gw will be produced in China, against global demand of just 30 gw. Producers in Shaanxi, Chengdu and Xinjiang are still overwhelmingly looking to foreign markets to take up excess supply, creating more price competition for struggling established companies.

Installation costs per watt dropped by 45% between 2010 and August 2012-much of this driven by falling panel prices. In the first 10 months of 2012, Chengdu's solar-cell exports rose by 60%, while the average value of those exports fell by 89%. Prices for polysilicon fell from US$50-55/kg in 2009 to US$20-30/kg in August 2012, forcing around 80% of the country's polysilicon producers to shut down this year.

Although western China will see demand grow, much depends on the pace of progress in constructing supporting infrastructure. The country is still struggling to build the infrastructure needed to transfer the electricity to market. In 2011, only 70% of China's installed solar capacity was connected to the grid.

In addition, more advanced power distribution and storage systems are needed to handle the irregular nature of power loads from solar and wind sources. The State Grid is reportedly investing more than Rmb300bn in upgrading transmission infrastructure this year. It plans to complete seven ultra-high voltage (UHV) lines by 2015, forming the backbone of a national grid system.

Several recently announced projects in Xinjiang and Qinghai are explicitly dependent on the further development of UHV lines. However, doubts remain over the success of these lines. Similar projects have been abandoned in Russia, the US and Japan, as overdependence on UHV can amplify the damage caused by isolated grid failures and blackouts. Projects often run over schedule in order to account for these issues. Many of China's new installations will probably remain off-grid for some time after they are completed.

In the next few years the country should surpass Germany and Italy as the world's largest consumer of solar panels. However, this will not be enough to fix the struggling sector. The central government will need to make more aggressive attempts at consolidation than it has

done so far, lest its companies-which are often propped up by local governments-fall further and further into debt. LDK Solar, one of the country's largest manufacturers, was sued in November for failing to repay its loans.

Western regions looking to expand their high-technology manufacturing may see a short-term boon, but the outlook for the overall industry is anything but sunny.

Turn: development increases stability and trade isn’t zero sumKlien, Washington Post Journalist, 10

[Ezra, 6/3/2010, The Washington Post, “The global economy isn't zero-sum”, http://voices.washingtonpost.com/ezra-klein/2010/06/the_global_economy_isnt_zero-s.html, accessed 7/8/2014 CK]

Polls and focus groups show that people go nuts for this sort of rhetoric. If you want the country to get behind your policy initiative, just tell them that China is beating us to the punch. But global economic growth is not a zero-sum game. Quite the opposite, in fact. If China and America both develop large and innovative clean-energy sectors, the result will be cleaner energy. If India graduates more engineers than we do, that means the world will have more engineers. If China gets a serious medical-research sector going, it will develop cures that will work on diseases that afflict Americans, too. Competitive language is used in service of worthy goals, but it's also dangerous stuff. We're telling Americans to fear the economic development of other countries, when what they should actually fear is the reverse. If China or India stagnate, that means they won't become huge markets for our exports, it means they won't develop new technologies that can better our lives, it means that they won't be geopolitical anchors in the way that only rich, stable countries can be. The global economy isn't a race so much as it's a relay.

No tradeoff – the Chinese industry will still grow even with American investment – solves the DA

Larson, 10 (Christina, contributing editor at Foreign Policy, correspondent for The New York Times, International Herald Tribune, The New Republic, The Washington Monthly, fellow at the New America Foundation, “America’s Unfounded Fears of A Green-Tech Race with China”, Yale University, Environment 360, http://e360.yale.edu/feature/americas_unfounded_fears_of_a_green-tech_race_with_china/2238/)

“Even when you are looking at these big numbers that are coming out of China today, I think it really pays to give a close look at what is actually happening on the ground,” says Elizabeth Economy, director of Asia Studies at the Council on Foreign Relations and author of The River Runs Black. “Then you begin to get a different, more nuanced picture than what is blasted on

the business section of the New York Times.” The first essential fact to be aware of is that most news stories about China’s greentech gains are about manufacturing. China is becoming the wind-turbine factory to the world for much the same reasons it has long been the TV and t-shirt factory to the world: lower wages, lower land prices, fewer regulatory and other requirements, etc. This isn’t particularly surprising, and it shouldn’t be seen as a reversal of the status quo. What’s changed most dramatically in the last five years has been growing global demand. With significant government investment, Chinese factories have planned for and stepped up production accordingly. Yes, this is bad news for U.S. cities like Detroit, where planners have recently been retrofitting old hot-rod factories into wind-turbine factories, such as an old Ford Thunderbird plant in Michigan that’s being converted into a green-tech manufacturing center in a bid to boost the local economy. China’s research labs are politically constrained, limiting their ability to attract top talent. Manufacturing in China, especially low and medium-tech manufacturing, has certain clear economic advantages. But it’s also worth considering a few other facts. Most of the green manufacturing jobs that the U.S. stands to “lose” haven’t in fact been created yet; China will gain thousands of new jobs, but not necessarily at America’s expense. Moreover, the United States will still gain many new green-collar jobs, in installation and maintenance, which can only be locally based, as well as sales teams, conference planners, and other positions already arising to support the growing green-tech field.

Turn—plan increases interdependence which builds relationsLuckhurst, Monterrey Institute of Technology and Higher Education Department of International Relations and Law Director, 2014

[Jonathan, 3/26/14, International Studies Association Annual Convention, “Is China—U.S. Economic Cooperation an Antidote to Strategic Conflict,” 7/9/14, IC]

The paper examines how China—U.S. economic cooperation decreases strategic tensions, with insights from social constructivism and complex interdependence theory. China‘s integration in the international economy decreases the potential for confrontation or a new ‗superpower‘ rivalry with the United States. Interdependence has also encouraged economic cooperation between their governments since the 2008 financial crisis. Socialization and a ‗crisis effect‘ further motivated Chinese policymakers to adopt liberal and multilateral norms of economic governance. The convergence of Chinese and U.S. leaders around new, post-crisis governance norms has enhanced their relations. Some scholars claim the BRICS1 could challenge U.S. influence and the ‗liberal international order‘, but the Chinese government has rejected attempts to destabilize the international economy and its multilateral institutions. Chinese and U.S. policymakers have prioritized cooperation as they perceive their relations to be based on the non-zero sum effects of complex interdependence. Socialization, normative suasion, and policy networks strengthen these ties and reduce prospects for significant strategic conflict.

Internal LinkNo impact to economic slow-down- it’s manageable and actually a good thing- prevents massive bubble burstsBremmer, president of Eurasia Group, the leading global political risk research and consulting firm, 2013

(Ian, July 19th, “Will China’s slowing growth lead to unrest?”, http://blogs.reuters.com/ian-bremmer/2013/07/19/will-chinas-slowing-growth-lead-to-unrest/, accessed 7/18/14, LLM)

But unlike many other emerging markets, China views slower growth as a manageable challenge. The government actually recognizes that a slowdown is necessary to meet its reform and rebalancing goals, and is working now to score political points among the population by arguing that it’s doing so. In particular, Beijing hopes that the slowdown will force industrial consolidation and less resource consumption, which could slow environmental degradation — which has been a major point of political vulnerability for the government. Slower growth should also calm the real estate sector, where rising prices have been a major sore point for urban Chinese. China’s new leadership is betting that progress on these fronts will outweigh the downside risks they’ll face as job losses tick up in the face of slower growth.

From a global perspective, there is a strong case to be made that China’s slowing growth rate is actually a good sign. The fact that Beijing hasn’t just reflexively pumped capital into the system to keep growth rates up shows that it is willing to begin undertaking modest economic reforms; it is, in effect, letting bubbles shrink rather than grow until they pop. This approach is characteristic of the new leadership that took charge in March of this year: they are less risk averse and they have a more long-sighted handle on the necessary economic changes that China will have to undertake.

The new president himself is a cause for optimism. Xi Jinping has a more assertive, off-the-cuff style; he is a more spontaneous, charismatic leader than his predecessors, and early reviews in China’s blogosphere suggest a favorable first impression. Xi is using this boldness to work to consolidate his support within the Communist Party. And the extent to which he is successful will mean even more capacity for even more reform over time.

CCP can manage social instability Lavin, Chinese Political Analyst for the Heritage Foundation, 2013

(Franklin L., April 1st, “Four Issues Facing China”, http://www.heritage.org/research/lecture/2013/04/four-issues-facing-china, accessed 7/18/14, LLM)

I’m a bit of a contrarian, because I think it’d be a mistake to interpret all of that as a broad destabilizing tendency. I think most of the protests, and most of the unhappy noises we hear, are in response to very specific local issues; they’re not general statements about Chinese government or Chinese politics. I’ll make another point as well, about upticks in labor protests, for example, or street protests, or what we’d call an American NIMBY (not in my backyard) protest—people unhappy about a specific activity taking place in their neighborhood. So the government announces that it will place a chemical plant in a certain jurisdiction and people from that jurisdiction have a street protest and the government backs down, or something happens. That’s what we call a NIMBY protest. But it’s not people wanting to overthrow the government or even wanting a broad change in the government; but they sure as heck don’t want that chemical plant in their neighborhood.

I’d say, in that context, you could argue that these protests are actually a factor for stability. If you have a system that allows protests, you actually have a more stable system than a system that didn’t allow them. Let me boil it down to a question asked by a friend. This was about six or eight months ago, as events in the Mid-East unfolded: “Won’t China have an Arab Spring? Don’t you have sort of the same conditions? You have a government that is not democratic and you have liberties that are substantially curtailed, and so wouldn’t you just have the same outcome there?” In my view, the two situations are not comparable, and there are four big differences between China and, say, the Arab world.

The first difference is that the Chinese economy is performing well. Second, China does allow scope for criticism and discussion of issues—not as much as the U.S., certainly, but I suspect considerably more than Syria and Libya, and more, even, than Egypt under Mubarak. Third, the Chinese system has the capacity for reform. The Chinese make changes and there are adjustments as they go along. I don’t have that impression from the Arab states. Fourth, China has made the transition from a personality-led system of government to a bureaucratic system. That transition allows a much higher level of functionality, probably less cronyism, greater performance, and it also removes a focal point for criticism. People aren’t happy with Mubarak in Egypt or they’re unhappy with the fact that the Syrian government is an inherited government, but there’s one less thing to complain about in China. There’s certainly a princeling class of people who are in positions of authority because of their fathers, but there’s not an inherited government in the Syrian sense. I’d also note that China has a more effective repressive apparatus, so the regime has a more effective ability to tamp down things it doesn’t like.

China continues to move the out-of-bound markers, it allows for more scope of discussion, and I think that helps feed into this overall stability. My take on the domestic stability side is also a bit bullish in the near term, that social stability is highly manageable. There could well be more protests, but these won’t translate into broad political discontent or condemnation of Beijing.

***Cadmium Mining DA

1NC ShellIncreased demand of renewables leads to increased cadmium miningCulley, writer for mining facts, 2012(Johnathon, 2/13, Mining Facts, “Mining needed to meet mineral needs of renewable energy”, http://www.miningfacts.org/Blog/Mining-News/Mining-needed-to-meet-mineral-needs-of-renewable-energy/, 7/17, JC)

Soaring demand and shortages in mineral supplies threaten renewable energy expansionA recent report by the United Nations predicts that wind, solar and other renewable energies will eventually account for most energy used.[1] In the U.S., the Energy Information Administration (EIA) recently reported that renewable energy from solar, wind, hydropower, geothermal and biomass/biofuels now makes up 11.95% of U.S. energy provided during the first three quarters of 2011.[2] Renewable energy production in the U.S. increased from 10.85% in 2010 and 10.33% in 2009, and now provides a greater share of domestic energy production than nuclear.[2]Renewable energy requires metals and mineralsThe increased production of renewable energy is also driving increased demand for mined metals and minerals. New solar panels require arsenic, bauxite, boron, cadmium, coal, copper, gallium, indium, iron ore, molybdenum, lead, phosphate, selenium, silica, tellurium, and titanium dioxide.[3] Wind turbines use concrete, bauxite, cobalt, copper, iron ore, molybdenum and rare earth elements.[4] The rare earth elements (REE), also known as rare earth metals, are particularly important in wind turbines as they reduce the weight and size needed for magnets in wind turbines.[5]Supply restrictionsSoaring demand and limited supplies of REE are now threatening to limit the expansion of renewable energy technologies, according to a recent U.S. Energy Department report.[6] China currently produces about 95% of the rare earth elements and five REE – dysprosium, terbium, europium, neodymium, and yttrium - face potential shortages until 2015.[6] China’s control over these elements is also of concern due to export restrictions and quotas.New supplies of Rare Earth ElementsThe U.S. is now seeking to develop its own domestic REE mining industry, as well as to diversify global supplies.[6] Canada also has the potential for REE production, with an estimated 56% of REE deposits outside of China.[5]Perhaps the most significant challenge to increasing REE supplies is the regulatory environment, which can result in multiple years between exploration and production.[6] However, without increased exploration and mining, the expansion of renewable energy technologies may be threatened.

Increased mining of cadmium leads to increased exposure to other environmentsCullen, professor of Earth and Ocean Sciences @ U of Victoria, 2013(Jay, Springer Science, Biogeochemistry of Cadmium and Its Release to the Environment, 7/18, JC)

The relative mobility of Cd and its inherent toxicity to organisms make it a heavy metal of concern and motivate the scientific community to understand its sources and fate in the environment. Humans have dramatically altered the biogeochemical cycle of Cd in the environment by mobilizing massive quantities of Cd in the biosphere. This mobilization occurs primarily through non-ferrous metal production and the burning of fossil fuels. As a consequence, material (both in the dissolved and particulate phase) in the atmosphere, as well as in rainwater, soils, sediments, and aquatic environments is significantly enriched in Cd relative to its average concentration in the continental crust. The emissions of Cd to the environment appear to have been curbed since the 1980s in response to increased regulation of its use and the implementation of more efficient point source capture and recycling initiatives. Indeed, global Cd production reached a plateau in ~1990 at ~20,000 t/yr. Over the past 40 years, however, we have seen a shift in the regions of major Cd production from Europe and North America initially to countries in East Asia more recently. This production shift reflects growing demand for energy and increased industrialization in this area. One concern, going forward, is that emissions in Asia are roughly 3-fold higher than on the next nearest continent and appear to be increasing with time perhaps due to less 56 Cullen and Maldonado stringent emission controls. Whether or not global emissions of Cd will increase in response to the rapid industrialization of countries in Asia remains to be seen, but should be closely monitored. Developments in the study of the marine biogeochemistry of Cd are particularly exciting and show significant progress since the first reliable measurements of dissolved Cd were made in the open ocean about 35 years ago. We now look upon Cd as a potentially ecologically significant nutrient involved in carbon acquisition by marine algae and have used sedimentary records of Cd preserved

Increases in cadmium use spreads cadmium to the agricultural sector – causes large scale spread of disease Page et al, professors of soil and environmental sciences, 1987(AL, UC Riverside, “Cadmium Levels in Soils and Crops in the United States”, http://dge.stanford.edu/SCOPE/SCOPE_31/SCOPE_31_2.05_Chapter10_119-146.pdf, 7/17, JC)Cadmium (Cd) is regarded as one of the most toxic trace elements in the environment. The increased emissions resulting from its production, use, and disposal, combined with its persistence in the environment, and its relatively rapid uptake and accumulation by food chain crops contribute to its potential environmental hazards. Cadmium may find its way to the human population through food and beverage, drinking water, air, and cigarette smoking. Although acute Cd toxicity caused by food consumption is rare, chronic exposure to high Cd levels in food can significantly increase the accumulation of Cd in certain body organs. When the concentration in the human body reaches levels considered to be harmful (> 200 p,g/gm wet weight in the kidney cortex according to Kjellstrom and Nordberg, 1978), cadmium-induced kidney damage, skeletal disorders as well as other diseases may result . A highly publicized episode of Cd poisoning of humans (itai-itai disease) was reported in Japan in the mid-1950s (Tsuchiya, 1978). The source of excessive Cd to the affected individuals came from rice grown on nearby paddies which had been irrigated with water from a river contaminated by zinc mining

operations. The Cd concentrations of the rice, of the river sediments and of the soil in which the rice was grown were considerably greater than those found in uncontaminated regions.

Disease lead to extinctionYu, Dartmouth Undergrad, 9

(Victoria, Undergraduate at Dartmouth, University publication, “Human Extinction: The Uncertainty of Our Fate,” Dartmouth Undergraduate Journal of Science, 22 May 2009, 6-31-13)

A pandemic will kill off all humans. In the past, humans have indeed fallen victim to viruses. Perhaps the best-known

case was the bubonic plague that killed up to one third of the European population in the mid-14th century (7). While vaccines have been developed for the plague and some other infectious diseases, new viral strains are constantly emerging — a process that maintains the possibility of a pandemic-facilitated human extinction. Some surveyed students mentioned AIDS as a potential pandemic-causing virus. It is true that scientists have been unable thus far to find a sustainable cure for AIDS, mainly due to HIV’s rapid and constant evolution. Specifically, two factors account for the virus’s abnormally high mutation rate: 1. HIV’s use of reverse transcriptase, which does not have a proof-reading mechanism, and 2. the lack of an error-correction mechanism in HIV DNA polymerase (8). Luckily,

though, there are certain characteristics of HIV that make it a poor candidate for a large-scale global infection: HIV can lie dormant in the human body for years without manifesting itself, and AIDS itself does not kill directly, but rather through the weakening of the immune system. However, for more easily transmitted viruses such as influenza, the evolution of new strains could prove far more consequential. The simultaneous occurrence of antigenic drift (point mutations that lead to new strains) and antigenic shift (the inter-species transfer of disease) in the influenza virus could produce a new version of influenza for which scientists may not immediately find a cure. Since influenza can spread quickly, this lag time could potentially lead to a “global influenza pandemic ,” according to the

Centers for Disease Control and Prevention (9). The most recent scare of this variety came in 1918- when bird flu managed to kill

over 50 million people around the world in what is sometimes referred to as the Spanish flu pandemic. Perhaps even more frightening is the fact that only 25 mutations were required to convert the original viral strain — which could only infect birds — into a human-viable strain (10).

UniquenessZinc prices increasing in the squo – cadmium production low because it is a derivative of zinc miningFaroon et al, researcher for the Agency of Toxic Substances and Disease Registry, 2012(O, 9/2012, NCBI, Toxicological Profile for Cadmium, http://www.ncbi.nlm.nih.gov/books/NBK158841/, 7/19, JC)Cadmium is a widely but sparsely distributed element found in the earth's crust at concentrations ranging from 0.1 to 5 ppm, primarily as sulfide minerals in association with zinc ores, zinc-bearing lead ores, and or complex copper-lead-zinc ores (Morrow 2001). Approximately 3 kg of cadmium for each ton of zinc are produced (OECD 1995). About 80% of cadmium production is associated with zinc production, while the other 20% is associated with lead and copper byproduct production and the recapture of cadmium from finished products (Morrow 2001). Between 2003 and 2006, the annual cadmium refinery production in the United States declined from 1,450 to 700 metric tons, dropping 52% between 2005 and 2006 (USGS 2007, 2008). Demand for cadmium in the nickel-cadmium (Ni-Cd) battery industry is strengthening as demand in other areas, like coatings and pigments, has been decreasing due to environmental concerns and regulations. Despite this demand, primary production of cadmium may decrease as zinc prices increase, since producers may choose to discard the cadmium byproduct instead of refining it (USGS 2008).

Zinc prices are at an all-time high – means decline in use inevitable, will decrease cadmium suppliesTroszkiewicz, reporter for Bloomberg, Javier, reporter for Bloomberg, 2014(Agnieszka, Luzi Ann, July 14, Bloomberg, Zinc Prices Rise to a 35 Month High as Inventories Decline, http://www.bloomberg.com/news/2014-07-14/zinc-prices-rise-to-35-month-high-as-inventories-decline.html, 7/19/14, JC)Zinc prices climbed to a 35-month high as inventories extended a slump amid signs of higher demand.Stockpiles monitored by the London Metal Exchange have dropped 29 percent this year to the lowest since December 2010. Demand for refined zinc will exceed output by 250,000 metric tons this year, according to BNP Paribas SA. Commodity consumption may climb in China, the world’s biggest user of industrial metals, Morgan Stanley said on July 11.“We’re seeing declining stockpiles help provide support for zinc,” Phil Streible, a senior commodity broker at R.J. O’Brien & Associates in Chicago, said in a telephone interview. “That may be an indication of rising demand.”Zinc for delivery in three months rose 0.2 percent to settle at $2,307 a ton at 5:51 p.m. on the LME. Earlier, the price touched $2,325.50, the highest since Aug. 5, 2011. Stockpiles dropped for the 11th straight session to 659,975 tons.Copper fell 0.5 percent to $7,122.50 a ton ($3.23 a pound). Stockpiles tracked by the LME in Busan, South Korea, have climbed sixfold this month to 12,350 tons.

Zinc supplies are decreasing – cadmium production will decrease McLeod, reporter for Zinc Investing, 2014(Charlotte, 6/21/, Zinc Investing News, The Zinc Deficit Has Arrived — Here’s What You Need to Know, http://zincinvestingnews.com/8196-zinc-deficit-supply-demand-outlook-2014.html, 7/19/14, JC)Those involved in the zinc market are likely tired of hearing that prices for the base metal are set to improve — just not quite yet. After all, that was the rallying cry of market watchers — from Haywood Securities’ Stefan Ioannou to analysts at Research and Markets, FastMarkets and HSBC Holdings — for the last six months or so of 2013.Zinc market participants are probably also tired of hearing the counterargument that zinc prices will go almost nowhere in 2014, or indeed 2015 and 2016.Central to the question of whether zinc prices are due to rise is yet another question, namely, is the zinc market set to fall into deficit, and, if so, when? Fortunately, Doug Ramshaw of McLeod Williams Capital was able to provide Zinc Investing News with some insight on that topic.Price rise inevitableRamshaw began by explaining that according to the International Lead and Zinc Study Group, the zinc market technically went into deficit in the last couple of months of 2013. However, that news hasn’t made much of a splash because “people are looking at zinc inventories still and seeing how high they are.” Indeed, he said, they sat at 786,000 tonnes just prior to the end of April. Skepticism is also rife because “proponents of zinc and the impending zinc rally are more often wrong than right” as zinc tends to have just “two good years out of every 10 to 12.”That said, Ramshaw believes this time prices really are set to rise. One reason he thinks so is that the 8-to-10-cent range that has existed between zinc and lead prices for the past couple of years recently narrowed to such an extent that zinc “just briefly … for a grand total of one day, traded higher than lead on a per-pound basis.” That’s significant because zinc and lead are “sister metals,” meaning they’re produced together at many major mines. While that may sound convenient, the metals’ relationship can cause problems when one is in higher demand than the other. Last year, for instance, some analysts were concerned that strong lead demand — and hence increased production of both lead and zinc — would hurt zinc prices. Less difference in price is thus a good thing for zinc.Ramshaw also cited declining zinc production as a reason prices should increase in the not-far-off future. “We have this almost unprecedented situation that in the space of two and a half calendar years, three of the top 10 zinc mines are coming offstream. When you have that all at once, that’s a lot of supply to try to replace,” he said. Specifically, he noted, “all these mines that are shutting down, it equates to about 12 percent of 2013 zinc production, zinc mine supply.”Twelve percent may not sound like a lot, but Ramshaw was careful to put that number in perspective. He commented, “if you look at that 12 percent and you equate that in terms of copper mine supply, that’s like BHP Billiton (ASX:BHP,NYSE:BHP,LSE:BLT) and Freeport-McMoRan Copper & Gold (NYSE:FCX) ending copper production, not for a month or six months or a year, but for good.” Given that “the copper market moves” even on just “fear of a strike at Escondida,” Ramshaw is convinced “people [don’t] understand quite how significant these mine closures are.”

Zinc stocks declining – cadmium consumption decreasingTan, writer for basemetals.com, 2014(Lynette, 6/30/14, basemetals.com, SHFE STOCKS – Metal stocks mostly down; zinc stocks fell for 4th consecutive wk, http://www.fastmarkets.com/zinc-news/shfe-stocks-metal-stocks-mostly-down-zinc-stocks-fell-for-4th-consecutive-wk-75996#sthash.W3wumxAY.dpuf, 7/19, JC)Deliverable copper stocks in warehouses monitored by the Shanghai Futures Exchange (SHFE) declined in the week of 30th May. Copper inventories stood at 91,947 mt Friday, lower by a modest 705 tonnes together with declining on-warrant stocks of 25 tonnes. Deliverable aluminium stocks decreased this week as well, falling 1,567 tonnes to 397,287 tonnes, and on-warrant stocks fell 2,873 tonnes to total 230,665 tonnes. SHFE deliverable zinc stocks decreased 8,302 tonnes to 217,166 tonnes, registering a fourth week of decline for more than 5,000 tonnes in weekly inventory. The decline in zinc stocks all came from the warehouses in Shanghai. On warrant stocks fell as well, decreasing 8,481 tonnes to 50,804 tonnes. Deliverable lead stocks saw a drop of 440 tonnes to 70,821 tonnes; on warrant stocks declined 1,452 tonnes to 49,687 tonnes. Gold stocks saw no change at 420 kilograms while silver stocks increased 1,339 kilograms to 229,113 kilograms. Rebar and wire rod stocks were flat at zero.

Links

RenewablesIncreased demand of renewables leads to increased cadmium miningCulley, writer for mining facts, 2012(Johnathon, 2/13, Mining Facts, “Mining needed to meet mineral needs of renewable energy”, http://www.miningfacts.org/Blog/Mining-News/Mining-needed-to-meet-mineral-needs-of-renewable-energy/, 7/17, JC)

Soaring demand and shortages in mineral supplies threaten renewable energy expansionA recent report by the United Nations predicts that wind, solar and other renewable energies will eventually account for most energy used.[1] In the U.S., the Energy Information Administration (EIA) recently reported that renewable energy from solar, wind, hydropower, geothermal and biomass/biofuels now makes up 11.95% of U.S. energy provided during the first three quarters of 2011.[2] Renewable energy production in the U.S. increased from 10.85% in 2010 and 10.33% in 2009, and now provides a greater share of domestic energy production than nuclear.[2]Renewable energy requires metals and mineralsThe increased production of renewable energy is also driving increased demand for mined metals and minerals. New solar panels require arsenic, bauxite, boron, cadmium, coal, copper, gallium, indium, iron ore, molybdenum, lead, phosphate, selenium, silica, tellurium, and titanium dioxide.[3] Wind turbines use concrete, bauxite, cobalt, copper, iron ore, molybdenum and rare earth elements.[4] The rare earth elements (REE), also known as rare earth metals, are particularly important in wind turbines as they reduce the weight and size needed for magnets in wind turbines.[5]Supply restrictionsSoaring demand and limited supplies of REE are now threatening to limit the expansion of renewable energy technologies, according to a recent U.S. Energy Department report.[6] China currently produces about 95% of the rare earth elements and five REE – dysprosium, terbium, europium, neodymium, and yttrium - face potential shortages until 2015.[6] China’s control over these elements is also of concern due to export restrictions and quotas.New supplies of Rare Earth ElementsThe U.S. is now seeking to develop its own domestic REE mining industry, as well as to diversify global supplies.[6] Canada also has the potential for REE production, with an estimated 56% of REE deposits outside of China.[5]Perhaps the most significant challenge to increasing REE supplies is the regulatory environment, which can result in multiple years between exploration and production.[6] However, without increased exploration and mining, the expansion of renewable energy technologies may be threatened.

SolarCadmium is a key resource for solar panelsZweibel et al, Former Director of the Institute for Analysis of Solar Energy at George Washington University, 2008(Ken, January, Scientific American, “A Solar Grand Plan”, http://www.scientificamerican.com/article/a-solar-grand-plan/, 7/16/14, JC)Photovoltaic Farms In the past few years the cost to produce photovoltaic cells and modules has dropped significantly, opening the way for large-scale deployment. Various cell types exist, but the least expensive modules today are thin films made of cadmium telluride. To provide electricity at six cents per kWh by 2020, cadmium telluride modules would have to convert electricity with 14 percent efficiency, and systems would have to be installed at $1.20 per watt of capacity. Current modules have 10 percent efficiency and an installed system cost of about $4 per watt. Progress is clearly needed, but the technology is advancing quickly; commercial efficiencies have risen from 9 to 10 percent in the past 12 months. It is worth noting, too, that as modules improve, rooftop photovoltaics will become more costcompetitive for homeowners, reducing daytime electricity demand.

Solar industry will inevitably use cadmium in thin film photovoltaic cells Mullins, writer for Gigaom, 2008(Robert, 9/25, Gigaom, “Cadmium: The Dark Side of Thin-Film?”, 7/18, JC)The future of the solar power industry may be bright, but solar also has a dark side — the panels being built today have an estimated lifespan of 30 to 40 years and then are largely discarded. The problem with that is that some thin-film photovoltaic solar cells contain hazardous substances like cadmium that can pose a health risk if the solar panel is simply thrown out after it’s done soaking up the sun. The issue is important enough that in late October, the Silicon Valley Toxics Coalition (SVTC), which lobbies to keep old computer parts from being dumped, plans to release a report raising concerns about cadmium in solar panels and urging manufacturers to reclaim old panels to keep cadmium out of the waste stream.Only about 1 percent of electrical generation globally comes from solar today, but that is expected to grow to 20 or 40 percent by 2020, according to McKinsey & Co. SVTC cites forecasts such as that to argue that the solar industry should develop best practices now to ensure solar panel makers take responsibility for the product lifecycle.“The writing is pretty much on the wall that solar panels have materials in them that need to be recovered because some of them are hazardous,” said Shelia Davis, executive director of the SVTC. Although relatively few solar panels have reached end of life, she’s concerned that when more of them are retired, they could end up with other construction debris in landfills.Cadmium, a byproduct of copper, lead and zinc mining, can be really bad for humans and the ecosystem. It’s a toxic metal that can cause kidney and breathing problems, according to the U.S. Labor Department. The European Union has also banned cadmium from being used in batteries and electronics.Cadmium is used in one of the leading new thin-film PV panel types, but as a compound that manufacturers argue is much safer than cadmium alone. Thin-film solar leader First Solar uses

cadmium-telluride to make the semiconductors that are sandwiched between two sheets of glass to convert the sunlight into electricity. So do newer startups like AVA Solar.

Internal Link

MiningMining spreads dangerous amounts of cadmium – empirics proveKaji, researcher @ Tokyo Institute of Technology, 2012(Masanori, 7/6/12, Role of experts and public participation in pollution control: the case of Itai-itai disease in Japan, 7/18/14, JC)

During the 1960s and 1970s, Japan enjoyed a period of very high economic growth but suffered at the same time from various forms of pollution, such as air, water, noise, and mining pollution. Japan was even referred to as ‘one of the advanced nations of the world in pollution’2. Pollution-related diseases became a matter of public concern. Itai-itai disease was one of these diseases, caused by a very severe type of cadmium poisoning resulting from the pollution of rice fields. The liquid wastes of the Kamioka mine, owned by the Mitsui Mining & Smelting Company Ltd (Mitsui Kinzoku), were eventually incriminated as the source of the cadmium. Kamioka was one of the richest zinc mines in Japan. Cadmium occurs as a minor component in most zinc ores and therefore is a byproduct of zinc production3. The numbers of patients suffering from this disease between 1910 and 2007 were estimated at ~400 (Mat su nami 2010, p. 44−48 & 537)

Increased mining of cadmium leads to increased exposure to other environmentsCullen, professor of Earth and Ocean Sciences @ U of Victoria, 2013(Jay, Springer Science, Biogeochemistry of Cadmium and Its Release to the Environment, 7/18, JC)

The relative mobility of Cd and its inherent toxicity to organisms make it a heavy metal of concern and motivate the scientific community to understand its sources and fate in the environment. Humans have dramatically altered the biogeochemical cycle of Cd in the environment by mobilizing massive quantities of Cd in the biosphere. This mobilization occurs primarily through non-ferrous metal production and the burning of fossil fuels. As a consequence, material (both in the dissolved and particulate phase) in the atmosphere, as well as in rainwater, soils, sediments, and aquatic environments is significantly enriched in Cd relative to its average concentration in the continental crust. The emissions of Cd to the environment appear to have been curbed since the 1980s in response to increased regulation of its use and the implementation of more efficient point source capture and recycling initiatives. Indeed, global Cd production reached a plateau in ~1990 at ~20,000 t/yr. Over the past 40 years, however, we have seen a shift in the regions of major Cd production from Europe and North America initially to countries in East Asia more recently. This production shift reflects growing demand for energy and increased industrialization in this area. One concern, going forward, is that emissions in Asia are roughly 3-fold higher than on the next nearest continent and appear to be increasing with time perhaps due to less 56 Cullen and Maldonado stringent emission controls. Whether or not global emissions of Cd will increase in response to the rapid industrialization of countries in Asia remains to be seen, but should be closely monitored. Developments in the study of the marine biogeochemistry of Cd are particularly exciting and show significant progress since the first reliable measurements of dissolved Cd were made in the

open ocean about 35 years ago. We now look upon Cd as a potentially ecologically significant nutrient involved in carbon acquisition by marine algae and have used sedimentary records of Cd preserved

Impacts

DiseasesIncreases in cadmium use spreads cadmium to the agricultural sector – causes the spread of diseases Page et al, professors of soil and environmental sciences, 1987(AL, UC Riverside, “Cadmium Levels in Soils and Crops in the United States”, http://dge.stanford.edu/SCOPE/SCOPE_31/SCOPE_31_2.05_Chapter10_119-146.pdf, 7/17, JC)Cadmium (Cd) is regarded as one of the most toxic trace elements in the environment. The increased emissions resulting from its production, use, and disposal, combined with its persistence in the environment, and its relatively rapid uptake and accumulation by food chain crops contribute to its potential environmental hazards. Cadmium may find its way to the human population through food and beverage, drinking water, air, and cigarette smoking. Although acute Cd toxicity caused by food consumption is rare, chronic exposure to high Cd levels in food can significantly increase the accumulation of Cd in certain body organs. When the concentration in the human body reaches levels considered to be harmful (> 200 p,g/gm wet weight in the kidney cortex according to Kjellstrom and Nordberg, 1978), cadmium-induced kidney damage, skeletal disorders as well as other diseases may result . A highly publicized episode of Cd poisoning of humans (itai-itai disease) was reported in Japan in the mid-1950s (Tsuchiya, 1978). The source of excessive Cd to the affected individuals came from rice grown on nearby paddies which had been irrigated with water from a river contaminated by zinc mining operations. The Cd concentrations of the rice, of the river sediments and of the soil in which the rice was grown were considerably greater than those found in uncontaminated regions.

Cadmium causes major health problems – aids in the spread of diseaseVoice of Russia, newspaper based in Russia, 2013

(12/27/14, The VOICE OF RUSSIA, Toxic agents in environment kill millions – WHO, http://voiceofrussia.com/2013_12_27/Toxic-agents-in-environment-kill-millions-WHO-6912/, 7/18/14, JC)

The World Health Organization has drawn up a list of chemical substances that are the greatest health hazards, including asbestos, benzol, cadmium, arsenic, too little or too much phosphorus, quicksilver, lead and some others. The WHO also points out the ongoing air pollution buildup.

The WHO admits that it is impossible to fully give up the use of harmful chemicals at the given stage of industrial development. But contact with toxic substances may well be ratcheted down.People are actually killed by the environment, for plastic products, chipboard furniture, cosmetics, water and even food products are all stuffed with chemicals, most of which are horrible toxins that kill millions of people across the world every year.Asbestos, for example, is a set of silicate minerals, superior to some grades of steel in terms of tensile strength; it is non-water soluble, chemically inactive, and immune to solar radiation effects, ozone and oxygen. Asbestos is used in mechanical engineering, road building, in making tubes and wall tiles. However, if its fibres are breathed in from the air, they remain inside one’s

body for good, causing lung or throat cancer, and also ovarian cancer or malignant mesothelioma.A campaign for banning the use of asbestos was launched across the world in the late 20th century. Asbestos has since been banned in the United States, Australia, New Zealand, Japan, and the European Union. Other countries allow the use of long-fibre asbestos, which is less carcinogenic. However, old road surfaces and buildings are still in place, so short-fibre asbestos continues poisoning one and all.Yet another example is heavy metals, also added to the WHO list. They have long been known for their adverse health effects, yet they continue to be used extensively in everyday life, an expert of the commission on updating the national health care system and demography of the Russian Public Chamber, Irina Ilchenko, says and elaborates.“Heavy metals are seen as super toxicants because they will not emerge from the body for a long time. Kidneys and other urinary organs are most sensitive to cadmium. Lead is a neuro-toxicant that’s responsible for neurodevelopmental delay even in minor concentrations. It negatively affects pregnancies, delivery and infants. But adults also suffer from the bad effects of lead”.Any concentration of lead is a health hazard. It is breathed in or penetrates one’s body through skin. Yet, we continue using things made of lead, such as soldering alloys and weight leads, printer’s types and ovenware frit glaze.Even the walls of old buildings pose a threat, since they were painted by lead paints, currently banned by law. Even if you make home in a recently repaired old building, you may rest assured that the deepest layers of lead paint continue releasing toxic air-pollutants that will steadily kill you.Cadmium is known to be used in car batteries. Many people will also know of yellowish self-attack screws, of which the cover contains cadmium. Quicksilver is used in thermometers and energy-saving lamps that may cause a lot of problems if you accidentally break them.

Cadmium easily spreads into lakes and contaminates food – leads to disease New Zealand Herald, newspaper based in New Zealand, 2013

(7/31, The New Zealand Herald, Cadmium poisoning from China factory kills 26: report, http://www.nzherald.co.nz/world/news/article.cfm?c_id=2&objectid=10906202, 7/18/14, JC)

At least 26 villagers have died from cadmium poisoning and hundreds more fallen ill since 2009 near a disused factory in central China, local media said Wednesday, underscoring the country's mounting pollution challenge.Soil samples from Shuangqiao in Hunan province contained 300 times authorised cadmium levels and excess amounts were found in 500 of 3,000 villagers tested by health authorities, the China Youth Daily said.It said 26 people had died as a result of cadmium exposure in the last four years, eight of them under 60 and 20 of them from cancer, while children in the village were born with deformities.A major chemical plant operated in the village until 2009, and a "huge" industrial waste pile remains in the factory grounds, as does "an odour that will not go away", the paper said.It described the situation as "one of the country's 10 biggest pollution incidents".

Cadmium is highly toxic and exposure to the metal "is known to cause cancer", according to the US Department of Labor.

Aff Answers

UniquenessCadmium mining high in the squo – batteries and solar panels use them Faroon et al, researcher for the Agency of Toxic Substances and Disease Registry, 2012(O, 9/2012, NCBI, Toxicological Profile for Cadmium, http://www.ncbi.nlm.nih.gov/books/NBK158841/, 7/19, JC)Though cadmium metal consumption for batteries has grown steadily since the 1980s and currently consumes 83% of the cadmium produced, other uses of cadmium began declining in the mid 1990s. Pigment, stabilizer, coating, and alloy markets for cadmium are decreasing due to environmental concerns (USGS 1997, 2008). Proposed legislation, particularly in the European Union, restricting cadmium in consumer products may have a negative effect on cadmium demand (USGS 2008). Excessive exports from Bulgaria and Russia in 1997 caused a drop in the average price of cadmium from $1.84 per pound in 1995 to $0.51 per pound in 1997. Also, Ni-Cd batteries have been replaced in some markets by lithium-ion and nickel metal hydride batteries (USGS 2008). As of 2006, Ni-Cd batteries made up 18% of the rechargeable battery market, down from 56% in 1996 with global sales decreasing 16% between 2005 and 2006 (USGS 2008). Despite this trend, demand for cadmium may increase due to new market opportunities for Ni-Cd batteries (USGS 2008). Regulations by local authorities have forced the recycling of cadmium in Ni-Cd batteries, further depressing the demand for primary cadmium metal (USGS 1999).

Squo SolvesState safety measures check cadmium exposure to the population - empiricsJacobs, correspondent for NYT, 2012(Andrew, 1/30, NYT, China Says It Curbed Spill of Toxic Metal in River, 7/18, JC)BEIJING — Officials in southern China appear to have averted environmental calamity by halting the spread of a toxic metal that had threatened to foul drinking water for tens of millions of people, the state media reported Monday.Officials said they had successfully diluted the concentration of cadmium, a poisonous component of batteries, that has been coursing down the Longjiang River in the Guangxi Zhuang Autonomous Region.The spill, which first occurred two weeks ago, prompted a rush on bottled water in several downstream cities and prompted worries that the contamination could reach as far as Hong Kong and Macao.The cadmium, a substance used in the production of paint, solder and solar cells as well as batteries, has been traced to discharges from a mining company in Guangxi that has since halted production, said Xinhua, the state-run news agency.

Shifting Away Cadmium is a material of the past –shift to magnesium chloride coming nowScience Daily, a scientific news website, 2014

(6/26, science daily, Cheap and enviromentally friendly: Tofu ingredient could revolutionize solar panel manufacture, http://www.sciencedaily.com/releases/2014/06/140626121852.htm, 7/18, JC)

The chemical used to make tofu and bath salts could also replace a highly toxic and expensive substance used to make solar cells, a University study published in the journal Nature has revealed.

Cadmium chloride is currently a key ingredient in solar cell technology used in millions of solar panels around the world. This soluble compound is highly toxic and expensive to produce, requiring elaborate safety measures to protect workers during manufacture and then specialist disposal when panels are no longer needed.

Safe and a fraction of the cost

Now, a University of Liverpool researcher has found that it can be replaced with magnesium chloride, which is extracted from seawater and is already used in products such as tofu, bath salts and for de-icing roads.

Safe and at a fraction of the cost -- $0.001 per gram compared to $0.3 -- it has also been shown in the study to be as effective as the expensive and toxic alternative.

Physicist, Dr Jon Major from the University's Stephenson Institute for Renewable Energy carried out the research. He said: "If renewable energy is going to compete with fossil fuels, then the cost has to come down. Great strides have already been made, but the findings in this paper have the potential to reduce costs further."

The cheapest solar cells being manufactured today are based on a thin film of insoluble cadmium telluride. Alone, these cells convert less than two percent of sunlight into energy. By applying cadmium chloride to them, this efficiency increases to over 15 percent.

Same efficiency boost

Liverpool research, however, has shown that magnesium chloride can achieve the same boost to efficiency.

Dr Major said: "We have to apply cadmium chloride in a fume cupboard in the lab, but we created solar cells using the new method on a bench with a spray gun bought from a model shop.

"Cadmium chloride is toxic and expensive and we no longer need to use it. Replacing it with a naturally occurring substance could save the industry a vast amount of money and reduce the overall cost for generating power from solar."

Cadmium InevCadmium usage will inevitably increase – it’s a question about restrictionsICDA, non profit organization specifically researching effects of cadmium, No Date(International Committee on Cadmium, Cadmium Emission, 7/18/, http://www.cadmium.org/pg_n.php?id_menu=7, JC)Cadmium will invariably be present in our society, either in useful products or in controlled wastes. Today, its health effects are well understood and well regulated so that there is no need to restrict or ban cadmium products which, in any event, contribute so little to human cadmium exposure as to be virtually insignificant.Nickel-cadmium batteries are essential and irreplaceable in many industrial and consumer applications, particularly those requiring high power, long cycle lives, and good high or low temperature performance. Rechargeable Ni-Cd batteries can replace thousands of primary non-rechargeable batteries, and thus significantly reduce the total amount of waste. The materials in recyclable Ni-Cd batteries can be more than 99% recovered for reuse in the production of new Ni-Cd batteries. World-wide initiatives have been undertaken in Japan, North America, Europe, Australia and the OECD to promote the collection of Ni-Cd batteries for recycling, thereby improving overall recycling rates. Ni-Cd batteries are also making important contributions to the development of the electric car market in Europe, thereby contributing to the improvement of urban air quality.Cadmium pigments and stabilisers are important additives in certain specialised plastics, glasses, ceramics and enamels to achieve bright colours along with long service lives, even in very demanding applications. From an ecological point of view, it is important to develop and maintain functional products with long service lives, once again to minimise the input into the world's waste stream. Inferior substitutes which produce shortened service lives will ultimately only increase the volume of the world's waste. It should also be emphasised that cadmium in these applications is in a chemically very stable, highly insoluble form, and embedded in the product's matrix.Cadmium coated components, likewise, provide outstanding corrosion resistance along with low friction coefficient, low electrical resistivity, good galvanic comparability, good plating coverage, ability to coat a wide variety of surfaces, and good brazeability and solderability. For these reasons, cadmium coated products are preferred for a wide range of critical and safety related applications in the aerospace, electrical, defence, mining, nuclear and offshore industries. In addition, cadmium coating wastes and products are easily recycled.The recovery of cadmium from cadmium products through recycling programs not only ensures that cadmium will be kept out of the waste stream and out of the environment, but it also conserves valuable natural resources as well. Attempts to ban or restrict cadmium products are considered unnecessary, taking into account the ever decreasing human cadmium intake level which is already well below the WHO-standard, and the very small relative contribution of cadmium products in this respect. Such measures will only have the effects of undermining extensive efforts to collect and recycle cadmium products around the world. It will also have the marked effect of reducing the European Union's competitiveness in international markets with its attendant delocalisation of plants and losses of jobs. These conclusions have already been

reached in North America and Japan which have no intention of restricting cadmium use in the manner proposed by the European Union. A similar conclusion was also reached in the OECD Risk Reduction Programme on Cadmium.Rather than restricting cadmium products, it is argued that the European Union should co-operate with and encourage the industry's voluntary product stewardship initiatives to collect and recycle cadmium containing products which would contribute to the sustainable and safe use of cadmium in modem society.

India demand for cadmium offsets lack of demand elsewhereSmith, writer for the Metal Bulletin, 2014(Chloe, 6/25/14, Metal Bulletin, Demand in India supports cadmium and selenium prices, LEXIS, 7/19, JC)Strong demand from India helped support cadmium and selenium prices this week, even as demand from China waned, sources told Metal Bulletin. The election of pro-business Narendra Modi as India's prime minister, on May 16, has driven strong demand from the country over the past month, helping keep prices for both the metals level this week. "Buying in India has picked up because their stock markets are up and they have elected a new president," a minor metals processor said. The appreciation of the rupee since the elections has also helped to generate demand from the country and enabled importers to pay higher prices as the cost of imports is reduced, sources said.Despite falling against the dollar slightly since the end of May, the rupee has appreciated a total of 1.6% since the end of April. The good level of demand in India kept selenium prices in Rotterdam at $23.50-26.50 per lb on Wednesday June 25, even as offers from China remained Selenium prices had been supported in previous weeks by a boost in enquiries from China as the manganese flake sector rebounded. But as manganese flake prices in China have stalled, demand from China has been knocked back. But the strong demand in India has enabled traders and producers to continue to make sales at higher levels, sources said. Importers in India have also reported difficulty in securing material from LS Nikko, which has also helped to boost demand from India to other suppliers. Cadmium prices also held on Wednesday, with prices at $0.75-0.85 for 3N5 material and $0.85-0.95 for 4N material.  "Indian buyers are active on cadmium and are always responsive whenever we have something to offer," one trader said. The continued demand from India for cadmium has helped to keep the price firm this year, despite expectations that weak demand in China would push the price down. The market has also responded positively to news that French recycler Aurea has been selected as a buyer for Floridienne. "This is good news for the cadmium market. The new owner has said it will respect Floridienne's existing business line which is also positive," the trader said. While the news has not given any lift to the market yet, it could help lift prices in September, a second minor metals processor said

Impact UQNo impact uq - Large amounts of cadmium are released naturallyICDA, non profit organization specifically researching effects of cadmium, No Date(International Committee on Cadmium, Cadmium Emission, 7/18/, http://www.cadmium.org/pg_n.php?id_menu=7, JC)2.1 Natural Cadmium Emissions Even though the average cadmium concentration in the earth's crust is generally placed between 0.1 and 0.5 ppm, much higher levels may accumulate in sedimentary rocks, and marine phosphates and phosphorites have been reported to contain levels as high as 500 ppm (Cook and Morrow 1995, WHO 1992). Weathering and erosion of parent rocks result in the transport by rivers of large quantities, recently estimated at 15,000 metric tonnes (mt) per annum, of cadmium to the world's oceans (WHO 1992, OECD 1994). Volcanic activity is also a major natural source of cadmium release to the atmosphere, and estimates on the amount have been placed as high as 820 mt per year (WHO 1992, OECD 1994, Nriagu 1980, Nriagu 1989). Forest fires have also been reported as a natural source of cadmium air emissions, with estimates from 1 to 70 mt emitted to the atmosphere each year (Nriagu 1980).

Solar Doesn’t Use CadmiumREMs aren’t key to solar – new tech means earth-abundant materials can be used.ACS, scientific society based in the US that supports scientific inquiry, 12

(American Chemical Society, 8/21/12, ACS, “New solar panels made with more common metals could be cheaper and more sustainable”, http://www.acs.org/content/acs/en/pressroom/newsreleases/2012/august/new-solar-panels-made-with-more-common-metals-could-be-cheaper-and-more-sustainable.html, 7/18/14, JC)

With enough sunlight falling on home roofs to supply at least half of America’s electricity, scientists today described advances toward the less-expensive solar energy technology needed to roof many of those homes with shingles that generate electricity. Shingles that generate electricity from the sun, and can be installed like traditional roofing, already

are a commercial reality. But the advance ― a new world performance record for solar cells made with “earth-abundant” materials ― could make them more affordable and ease the integration of photovoltaics into other parts of buildings, the scientists said. Their report was part of a symposium on sustainability at the 244th National Meeting & Exposition of the American Chemical Society, the world’s largest scientific society,

being held here this week. Abstracts of other presentations appear below. “Sustainability involves developing technology that can be productive over the long-term, using resources in ways that meet today’s needs without jeopardizing the ability of future generations to meet their needs,” said Harry A. Atwater, Ph.D., one of

the speakers. “That’s exactly what we are doing with these new solar-energy conversion devices.” The new photovoltaic technology uses abundant, less-expensive materials like copper and zinc ― “earth-abundant materials” ― instead of indium, gallium and other so-called “rare earth” elements . These substances not only are scarce, but are supplied largely by foreign countries, with China mining more than 90 percent of the rare earths needed for batteries in hybrid cars, magnets, electronics and other high-tech products. Atwater and James C. Stevens, Ph.D., described

successful efforts to replace rare earth and other costly metals in photovoltaic devices with materials that are less-expensive and more sustainable . Atwater, a physicist at the California Institute of Technology, and Stevens, a chemist with The Dow Chemical Company, lead a partnership between their institutions to develop new

electronic materials suitable for use in solar-energy-conversion devices. Atwater and Stevens described development and testing of new devices made with zinc phosphide and copper oxide that broke records for both electrical current and voltage achieved by existing so-called thin-film solar energy conversion devices made with zinc and copper. The advance adds to evidence that materials like zinc phosphide and copper oxide should be capable of achieving very high efficiencies, producing electricity at a cost approaching that of coal-fired power plants . That milestone could come within 20 years, Atwater said. Stevens helped develop Dow’s PowerHouse Solar Shingle, introduced in October 2011, which generates electricity and nevertheless can be installed like traditional roofing.

***Nuclear Renaissance DA

1NC ShellThe Renaissance is now- investment level is sufficient and will solve warmingSilverstein, contributor to Forbes specializing in international energy policy, 3/9

[Ken, 3/9/14, Forbes, “Nuclear Power rising at the Expense of Renewable Power”, http://www.forbes.com/sites/kensilverstein/2014/03/09/nuclear-energy-rising-at-the-expense-of-renewable-power/, 7/17/14, JA]

Just before the Fukushima disaster hit three years ago, nuclear energy had been standing tall. But the earthquake and giant waves knocked out the legs from under the fuel source, killing Japan’s nuclear ambitions as well as that of some other nations that had a robust nuclear power presence. The tsunami turned Japan’s world upside down. But it also dazed a global community that had planned to crank up the nuclear dial a notch. Some countries such as Germany, Italy and Sweden have chosen to scale back their nuclear production and to increase their renewable generation to help the continent meet its carbon reductions goals. But others, like China and the United Kingdom, are revving up their nuclear programs. By 2020, Europe is supposed to have cut its carbon emissions by 20 percent — something for which it is set to do, with a little help from the global recession. After that, however, it may switch to give individual countries more flexibility by setting an overall European Union target of 40 percent by 2030. Why the proposed changes? Renewables have high costs and they are a challenge to integrate on to the grid. The continent’s biggest green producers, Germany and Spain, have tempered their spirit given that the annual price to customers is about $32.5 billion in both countries. Both Germany and Spain get about 23 percent of their energy from renewables. But Germany plans to cut those subsidies by $2.5 billion while Spain will slash $3.5 billion. At the same time, utilities with offshore wind energy interest in the UK are scrapping their construction plans: Iberdrola ’s ScottishPower won’t build what was to be the world’s largest offshore wind farm, saying that it would be infeasible. And the Guardian newspaper reports that Germany’s RWE and British-owned Centrica have both pulled out of potential offshore wind deals. “It is our view that the Argyll Array project is not financially viable in the short term … As construction techniques and turbine technology continues to improve, we believe that the Argyll Array could become a viable project in the long term,” which is defined here as 10-15 years, says Jonathan Cole, head of offshore wind development for ScottishPower. What now? Nuclear energy is getting off of its knees and it is perched to rebound, at least in certain parts of the world: In the United States, four reactors at two plants are under construction while the U.S. Department of Energy has been increasing funding for advanced nuclear research and development. Meantime, China, Korea, the UAE, Saudi Arabia and the UK are advancing nuclear production to address air pollution and climate concerns. China has 20 nuclear plants today and 28 more under construction — 40 percent of all projected new nuclear units, says the World Nuclear Association. A similar dynamic exists in the UK, which approved the construction of two reactors at Hinkley Point that will provide 7 percent of the UK’s electricity. “It will hopefully open the flood gates and unlock further investment in the sector, introducing a new phase of activity to deliver a fleet of new nuclear reactors generating low carbon electricity in the UK,” says Daniel Grosvenor, head of Deloitte’s UK nuclear practice. “It also shows that the UK can attract the international investment our energy sector desperately needs.” The deal, which was announced in October 2013 must still receive

permission from the European Commission: Electricite de France will own 40-50 percent while another French national, Areva , will own 10 percent. Meantime, two Chinese national entities will own 30-40 percent. A shortlist of companies will buy the remaining 15 percent. The goal is to be operational by 2023. Significantly, some high profile climate scientists are hitting the lecture circuit and publishing their views to express that higher percentages of nuclear energy are essential to combating climate change. They, in turn, are asking their environmental brethren to embrace this position — and to quit viewing nuclear energy from the perspective of 1979 when the partial meltdown at Three Mile Island occurred. All this is happening after the release of the UN Intergovernmental Panel on Climate Change latest findings, which have concluded with 95 percent certainty that humans are mostly responsible for global warming. In 2007, it made the same assertion but with 90 percent assurance. “Quantitative analyses show that the risks associated with the expanded use of nuclear energy are orders of magnitude smaller than the risks associated with fossil fuels,” write the scientists, who include James Hanson at the Columbia University Earth Institute. The Environmentalists’ long-standing view of nuclear energy has “relaxed” but it has not changed. Renewables, they say, are both cheaper and safer. In this country, they point out that five nuclear plants have been forced to close in the last year. Three of those are because the facilities cannot compete with cheaper combined cycle natural gas facilities and two have been tied to ongoing technical issues, one of which involved uncommon vibrations and a small radiation leak. The Center for American Progress says that even if every major environmental organization halted its opposition to nuclear energy, the industry would still stumble. It’s a function of economics — that developers can get other types of plants up-and-running much quicker and a lot cheaper. Southern Company’s two nuclear units that are going up in Georgia are now expected to cost $15.5 billion, of which a federal loan guarantee will cover more than half. Major energy transitions are lengthy, says Michael Shellenberger, president of the Breakthrough Institute, in an interview. Moving from wood to coal took more than a century while shifting from coal to natural gas is taking just as long. Renewables are getting there, he adds, although it will require activist governments. But nuclear generation is here and now, he emphasizes. “Nuclear power is already providing 20 percent of our power in the United States and 80 percent of the electricity in France,” says Shellenberger. “The right questions are how do we encourage a transition to it and how do we make it cheaper,” and not to dismiss it because of a stale mindset.

Government backed renewables trade off with nuclear energy- empirics proveJohnsson, contributor to Bloomberg specializing in economics and energy, 13

[Julie, 3/11/13, Bloomberg, “Nuclear Industry Withers in U.S. as Wind Pummels Prices”, http://www.bloomberg.com/news/2013-03-11/nuclear-industry-withers-in-u-s-as-wind-pummels-prices-energy.html, 7/17/14, JA]

A glut of government-subsidized wind power may help accomplish a goal some environmentalists have sought for decades: kill off U.S. nuclear power plants while reducing reliance on electricity from burning coal. That’s the assessment of executives and utility experts after the U.S. wind-energy industry went on a $25 billion growth binge in 2012, racing to qualify for a federal tax credit that was set to expire at year’s end. The surge added a record 13,124 megawatts of wind turbines to the nation’s power grid, up 28 percent from 2011. The new wind

farms increased financial pressure on traditional generators such as Dominion Resources (D) Inc. and Exelon Corp. in their operating regions. That’s because wind energy undercut power prices already driven to 10-year-lows by an abundance of natural gas. “Right now, natural gas and wind power are more economic than nuclear power in the Midwestern electricity market,” Howard Learner, executive director of the Environmental Law and Policy Center, a Chicago-based advocate of cleaner energy, said in a phone interview. “It’s a matter of economic competitiveness.” Wind-generated electricity supplied about 3.4 percent of U.S. demand in 2012 and the share is projected to jump to 4.2 percent in 2014, according to the U.S. Energy Information Administration. Photographer: Konrad Fiedler/Bloomberg Wind-generated electricity supplied about 3.4 percent of U.S. demand in 2012 and the... Read More The wind power boom has benefited consumers in regions where wind development is fastest, contributing to a 40 percent wholesale power-price plunge since 2008 in the Midwest, for example. Yet the surplus is creating havoc for nuclear power and coal generators that sell their output into short-term markets. ‘Perfect Storm’ The impact is greatest in the capacity-glutted Midwest. There, Richmond, Virginia-based Dominion is closing a money- losing reactor and selling coal plants, Exelon warns of shrinking nuclear margins and an Edison International (EIX) merchant coal-plant unit has gone into bankruptcy. “It’s a perfect storm,” said Charley Parnell, a Chicago- based spokesman for Edison’s Midwest Generation unit, in a phone interview. Pricing, already under pressure from cheap natural gas and the lingering effects of recession, now has a wind factor. “Wind absolutely plays a part in that,” he said, “especially in the off-peak hours.” Atomic-power providers complain that the upheaval is an example of government subsidies distorting the market -- to the particular detriment of nuclear which provides 19 percent of the nation’s electricity, is clean and has proved safe despite perennial concern by activists that it poses a danger to public safety. Prices Below Zero Wind power has two advantages. Green energy laws in many states require utilities to buy wind energy under long-term contracts as part of their clean-energy goals and take that power even when they don’t need it. Wind farms also receive a federal tax credit of $22 for every megawatt-hour generated. Thus, even when there is no demand for the power they produce, operators keep turbines spinning, sending their surplus to the grid because the tax credit assures them a profit. On gusty days in the five states with the most wind power - - Texas, California, Iowa, Illinois and Oregon -- this can flood power grids, causing prices to drop below zero during times when demand is light. Wholesale electricity during off-peak hours in Illinois has sold for an average price of $23.39 per megawatt hour since Jan. 1, after hitting a record low of -$41.08 on Oct. 11, the least since the Midwest Independent Transmission System Operator Inc. began sharing real-time pricing in 2005. ‘Negative Prices’ Meanwhile, nuclear and coal plants must continue running even as this “negative pricing” dynamic forces them to pay grid operators to take the power they produce. “It is becoming more pronounced as more wind is coming on,” Christopher Crane, chief executive officer of Chicago- based Exelon Corp. (EXC), said in a phone interview. If the push to “over-develop” subsidized wind continues, “there is a very high probability that existing safe, reliable nuclear plants will no longer be competitive and will have to be retired early,” according to Crane. More development seems a certainty. Wind power got another boost when Congress, as part of January’s deficit deal, extended the production tax credit through Dec. 31, amending current law so that projects begun this year will receive the 10-year tax break regardless of when they come online. Defending Wind While few new projects are expected to be built out

this year due to developers’ mad dash at the end of 2012, “we think 2014 will pick up again,” said Rob Gramlich, interim CEO of the American Wind Energy Association, a trade group. Gramlich doubts wind power is the chief reason that spot- market power producers like Exelon are suffering a profit drain. “Low prices are due to a lot of things, mostly shale gas,” he said. “But to some extent wind does reduce power prices and that’s a good thing for homes and businesses.” Natural gas is fuel for a growing number of U.S. power plants because of its cost advantage and new environmental rules for coal. Wind is gaining as turbine costs plummet -- they are down one-third since 2010 -- and technology gains make windmills economical in states with lower average wind speeds. Google Inc. (GOOG) is investing $1 billion in wind and solar projects and Warren Buffett’s MidAmerican Energy Holdings, Iowa’s largest utility owner, owns 6 percent of U.S. wind-energy capacity and has invested about $13 billion in renewable energy. Tenfold Rise U.S. wind installations have risen 10-fold since 2003 to 60,007 megawatts, attracting $120 billion investment that has produced new capacity equivalent to 14 nuclear power plants and enough to power 14.7 million homes, the AWEA, the industry group based in Washington, D.C., said in a Jan. 30 report. Wind’s rapid gains have created headaches for grid operators since winds often blow strongest when homes and businesses use the least amount of power: at night and during the spring and fall seasons, said Paul Patterson, a New York- based analyst with Glenrock Associates LLC. “I think this model’s got problems with it,” Patterson said in a phone interview. “There are not many examples where the product you produce actually has negative value.” Before 2006, when wind power began its latest growth spurt, negative prices were extremely rare. The phenomenon is now prevalent in parts of the Midwest, Texas and the West Coast where turbine installations are growing fastest, data compiled by Bloomberg show. “We can’t find enough demand for the amount of energy created by Mother Nature,” said Doug Johnson, spokesman for the Bonneville Power Administration, which manages the grid in the Pacific Northwest. The transmission operator, based in Portland, Oregon, paid wind operators $2.7 million last year to stay off line so it could make room for the power from hydroelectric generators handling the runoff from melting mountain snows. Wind vs Fossil Fuels The surge in wind generation is also squeezing the number of hours that fossil-fuel plants are needed to supply some wind- heavy markets, said Michael Blaha, the principal analyst of North American power research for Wood Mackenzie Ltd. in Houston. “It makes it economically harder for fossil units because when the wind’s up, it’s going to start depressing prices,” he added. Negative prices are starting to seep into a Southern California power hub and may become more frequent as state regulations mandate that 33 percent of its power come from renewable sources by 2020, Blaha said. “That extra amount is going to knock out about 15 percent” of energy filled by fossil fuels. Exelon in Illinois Exelon, the largest U.S. nuclear operator, says a surplus of wind power is making negative pricing a problem in Illinois, where it owns six nuclear plants and a wind project. Prices for markets served by Exelon’s Clinton and Quad Cities reactors trade below zero between 8 percent and 14 percent of off-peak hours, said Joseph Dominguez, Exelon’s senior vice-president for governmental and regulatory affairs and public policy. Exelon cut its quarterly dividend for the first time Feb. 7, after reporting a 38 percent decline in fourth-quarter profit on lower power prices and higher nuclear fuel costs. “Wind generators ignore that price signal in order to chase the federal tax credit,” Exelon’s Dominguez said in a telephone interview. “Everyone else that is producing electricity during that time period pays that negative $30 per megawatt-hour back to the system in the form of

congestion charges.” The market should remain “open and fair” even in the “very rare instances” when demand can’t support two low-cost sources like wind and nuclear, Gramlich of the wind trade group said. “Just because one was there first doesn’t mean they automatically get the right of way to operate 24-7.

The Nuclear Renaissance is the only way to solve global warmingPerry, contributor to Investors Business Daily, 6/9

[Mark, 6/9/14, Investor’s Business Daily, “Alternative Energy no Substitute for Clean Energy”, http://news.investors.com/ibd-editorials-brain-trust/060914-703954-mark-perry-nuclear-power-is-cleaner-than-the-green-alternatives.htm?nav=NewsLatest&p=3, 7/17/14, JA]

Wind and solar power, once viewed as our best hope for abundant supplies of zero-carbon energy, are distracting us from what might be the real solution: nuclear power. The time has come for states to reconsider their mandates requiring that a share of electricity come from renewable energy sources, and instead consider a more direct and sensible policy in support of nuclear power. Currently 30 states have renewable power standards designed to promote the use of wind and solar power, which are carbon-free, non-polluting sources of energy. Among the most ambitious, California's standard mandates that the state generate one-third of its electricity from renewables by 2020. But the hype over wind and solar power as clean and renewable is undermined by their fatal flaw — intermittency. Realistically, you can't produce wind and solar power when people need it. Electricity from both is only available when nature cooperates. Power production fluctuates wildly, depending on the weather. The amount of energy that the average wind turbine produces annually is equal to just 20% to 30% of the amount of energy that would result from year-round operation at full capacity, and there is no proven storage technology that would make wind an around-the-clock base-load provider. Marginal Return The capacity factor for solar power runs closer to 20%. Together, wind and solar power contribute only marginally to U.S. energy supplies, accounting for just over 4% of U.S. electricity production in 2013, despite billions of dollars in taxpayer subsidies. And they cannot come close to replacing conventional sources of base-load power generation. Most renewables collect extremely diluted energy, requiring large areas of land. Jesse Ausubel of Rockefeller University has estimated that a wind farm equivalent in output and capacity to a 1,000-megawatt nuclear plant would occupy 298 square miles. The solar photovoltaic equivalent would occupy 58 square miles. And wind turbines cause visual and noise pollution and kill huge numbers of birds. Furthermore, as intermittent electricity sources, wind and solar power must be backed up by standby generation that can be dispatched on demand — usually from natural gas. Emissions Washout To use more wind and solar increases the need for backup power, and the associated emissions that come with it will largely cancel out any emissions savings from renewables. In short, wind and solar production won't make much of a difference in reducing emissions, and meaningful levels of production have, at best, a negligible positive impact. By contrast, nuclear power — which is not eligible for mandatory use under the renewable power standards — supplies nearly 20% of the nation's electricity. The clean little secret of recent years is that nuclear power has performed very well. Nuclear power is our zero-emission energy workhorse, providing 64% of the nation's zero-carbon energy. Over the last decade, the U.S. fleet of around 100 nuclear plants has generated electricity about 90% of the time. Thus, a

1,000-megawatt nuclear plant produces three times more electricity than 1,000 megawatts of wind turbines and four times more electricity than solar panels. Policymakers and politicians have routinely ignored the impact that the mandate for renewable power has had in more than half the country where electricity markets have been deregulated. And the result has been a catastrophe for nuclear power, with safe and efficient reactors either being shut down prematurely or at risk of being shuttered for no good reason. In states where power is deregulated, the wholesale price of electricity is set by auction, and when there is an oversupply, the price naturally drops. When that happens, nuclear power plants operate at a loss, and often end up having to pay to generate electricity. The market distortion caused by negative prices makes it difficult for nuclear power plants to recover their costs and discourages investment in new generation. As a result, 30% of the U.S. nuclear fleet might be forced to close within several years, and it's not because of their production costs, which are competitive with natural gas, but because of the state energy mandates. The Energy Information Administration forecasts a 28% increase in U.S. power demand through 2040. Those who claim that solar and wind can meet all of our electricity needs by then are engaged in fantasy. Renewables cannot get us even halfway there. In fact, the renewable sources added in recent years have made the electric system more fragile, because of their intermittency problems.

UniquenessThe Nuclear Renaissance is coming now- their evidence doesn’t assume new reactors which are safer, smaller and more cost competitiveBullis, Senior Editor specializing in Energy at MIT Technology Review, 13

[Kevin, 8/19/13, MIT Technology Review, “A Nuclear Reactor Cost Competitive with Natural Gas”, http://www.technologyreview.com/news/518116/a-nuclear-reactor-competitive-with-natural-gas/, 7/18/14, JA]

A novel type of reactor could cut the cost of nuclear power by as much as 40 percent, making it far more competitive with fossil-fuel power plants. Designed by General Atomics, a San Diego–based company, the reactor could also be safer than existing reactors and reduce nuclear waste by 80 percent. General Atomics has been working on the reactor for five years. Now it is trying to win several hundred million dollars in funding from the U.S. Department of Energy, which the company says would be crucial to commercializing the technology. At least one other new design aims to substantially reduce the cost of nuclear power, but it’s from a startup with limited funding (see “Safer Nuclear Power, at Half the Price”). In the United States, where natural gas is cheap, the main thing keeping utilities from building nuclear plants is their expense. While some other new reactor designs lower the up-front cost of nuclear power, they don’t necessarily lower electricity costs (see “Can Small Reactors Ignite a Nuclear Renaissance?”). Estimates from the Energy Information Administration suggest that if the General Atomics design cuts the cost of electricity by 40 percent as the company claims, new nuclear power plants would be economically competitive with natural-gas plants. John Parmentola, senior vice president of the Energy Group at General Atomics, says the new reactor will be safer than many conventional ones. In the case of a power failure, it is designed to shut down and cool off without the need to continuously pump in coolant. This is accomplished in part by using ceramics that can withstand very high temperatures without melting. To reduce costs, General Atomics is making the reactor smaller than conventional ones. Several other manufacturers are taking the same approach, but this design goes further by substantially increasing the efficiency of the power plant. Using helium as a coolant instead of water allows the plant to operate at higher temperatures, and the reactor also incorporates a new gas turbine for producing electricity. Thanks to these changes, the technology can generate more power from a given amount of heat produced in the reactor core. While conventional reactors convert 32 percent of the energy in heat to electricity, this one is expected to convert 53 percent.

The Nuclear Renaissance is coming now- new tech means it’s cost competitive, international investment now, it’s a base load source of energy and solves global warmingWorld Nuclear Association, an organization that represents the people and the organizations of nuclear energy, 2014

[January 2014, World Nuclear Association, “The Nuclear Renaissance”, http://www.world-nuclear.org/info/Current-and-Future-Generation/The-Nuclear-Renaissance/, 7/19/14, JA]

Increasing energy demand, plus concerns over climate change and dependence on overseas supplies of fossil fuels are coinciding to make the case for increasing use of nuclear power.

China is embarking upon a huge increase in nuclear capacity to 58 GWe by 2020; India's target is to add 20 to 30 new reactors by 2030.

Communities in Finland and Sweden have accepted the local construction of permanent disposal sites for nuclear waste.

International cooperation and commerce in the field of nuclear science and technology is growing.

A WNA projection shows at least 1100 GWe of nuclear capacity by 2060, and possibly up to 3500 GWe, compared with 373 GWe today.

Most of the increased capacity (over 80%) will be in countries which already use nuclear power.

Since about 2001 there has been some talk, especially in the West, about an imminent nuclear revival or "renaissance" which implies that the nuclear industry has been dormant or in decline for some time. Whereas this may generally be the case for the Western world, nuclear capacity has been expanding in Eastern Europe and Asia. Globally, the share of nuclear in world electricity has showed slight decline from about 17% to 11.5% since the mid-1980s, though output from nuclear reactors actually increased, albeit not enough to match the growth in global electricity consumption.

Today nuclear energy is firmly on the policy agendas of many countries, with projections for new build similar to or exceeding those of the early years of nuclear power. This signals a revival in support for nuclear power in the West that was diminished by the accidents at Three Mile Island and Chernobyl and also by nuclear power plant construction cost overruns in the 1970s and 1980s, coupled with years of cheap natural gas.

The March 2011 Fukushima accident set back public perception of nuclear safety, despite there being no deaths or serious radiation exposure from it (while the direct death toll from the tsunami which caused it was some 19,000). Also the advent of shale gas has adversely changed the economics of nuclear power in places such as North America.

Drivers for nuclear expansion today

The first generation of nuclear plants were justified by the need to alleviate urban smog caused by coal-fired power plants. Nuclear was also seen as an economic source of base-load electricity (ie continuous, relaible supply on a large scale) which reduced dependence on overseas imports of fossil fuels. Today's drivers for nuclear build have evolved:

Increasing energy demand

Global population growth in combination with industrial development will lead to a doubling of electricity consumption from 2007 level by 2030. Besides this incremental growth, there will be

a need to replace a lot of old generating stock in the USA and the EU over the same period. An increasing shortage of fresh water calls for energy-intensive desalination plants, electric vehicles will increase overnight demand, hence base-load (low cost) proportion of supply, and in the longer term hydrogen production for transport purposes will need large amounts of electricity and/or high temperature heat.

Security of Supply

A re-emerging topic on many political agendas is security of supply, as countries realize how vulnerable they are to interrupted deliveries of oil and gas. The abundance of naturally occurring uranium and the large energy yield from each tonne of it makes nuclear power attractive from an energy security standpoint. A year or two's supply of nuclear fuel is easy to store and relatively inexpensive.

Climate change

Increased awareness of the dangers and possible effects of climate change has led decision makers, media and the public to agree that the use of fossil fuels must be reduced and replaced by low-emission sources of energy. Popular sentiment focuses on renewables, but nuclear power is the only readily-available large-scale alternative to fossil fuels for production of continuous, reliable supply of electricity (ie meeting base-load demand).

Economics

Increasing fossil fuel prices have greatly improved the economics of nuclear power for electricity, though this is temporarily countered by low gas prices in the USA. Several studies show that nuclear energy is the most cost-effective of the available base-load technologies, at least when natural gas prices are high. In addition, as carbon emission reductions are encouraged through various forms of government incentives and emission trading schemes, the economic benefits of nuclear power will increase further.

Insurance against future price exposure

A longer-term advantage of uranium over fossil fuels is the low impact that increased fuel prices will have on the final electricity production costs, since a large proportion of those costs is in the capital cost of the plant. This insensitivity to fuel price fluctuations offers a way to stabilize power prices in deregulated markets.

Grid stability

Significant grid stability issues arise with high inputs from intermittent renewable sources, and secure stable supply is enhanced by base-load generation of any kind. However, balancing this technically and economically with subsidised renewables having preferential feed-in access to the grid is a difficult issue.

As the nuclear industry is moving away from small national programmes towards global cooperative schemes, serial production of new plants will drive construction costs down, as is already being shown in China, and further increase the competitiveness of nuclear energy.

An enabling factor is the increasing ability of nuclear reactors to load-follow, adjusting their output according to demand, so that they are less restricted to steady base-load role. However in the short term this is only relevant where nuclear power supplies more than about 60% of the power.

In practice, is a rapid expansion of nuclear power capacity possible?

Most reactors today are built in under five years (first concrete to first power), with four years being state of the art and three years being the aim with modular prefabrication. Several years are required for preliminary approvals before construction.

The Nuclear Renaissance is happening now- public support has skyrocketed and the tech is feasibleMcMahon, contributor to Forbes specializing in green energy and technology, 2012

[Jeff, 9/27/12, Forbes, “The Nuclear Renaissance Is Back, Industry Panel Says”, http://www.forbes.com/sites/jeffmcmahon/2012/09/27/the-nuclear-renaissance-is-back-industry-panel/, 7/17/14, JA]

Encouraged by a new poll showing public support, industry leaders predicted Wednesday that nuclear power will resume the “renaissance” it was enjoying before the Fukushima accident roiled the industry 18 months ago. “The future of nuclear is looking pretty good,” said Jack Grobe, the executive director of Exelon Nuclear Partners, striking a much more positive tone than former Exelon CEO John Rowe did just six months ago. Grobe was among five industry leaders who lauded “The Future of Nuclear” Wednesday at the Great Lakes Symposium on Smart Grid and the New Energy Economy, held at the Illinois Institute of Technology in Chicago. The panelists’ confidence stems in part from the nation’s fleet of aging coal plants, which are not expected to survive increasingly stringent environmental regulations. “We will retire these old fossil fuel plants and have to replace them with something,” said Scott Bond of Ameren Missouri, the utility that operates the Callaway Nuclear Generating Station. “The question is, what do you replace them with?” One obvious answer is a power plant that burns natural gas, which, thanks to fracking, is now so cheap and plentiful that Rowe said in March that it doesn’t make sense for new nuclear plants to compete. Wednesday’s panel touted the stable price of nuclear fuel as insurance against the vagaries of most other fuel prices including, over the long term, natural gas. “It’s not just an economic question,” said Exelon’s Jack Grobe. “It’s an energy diversity question.” “There’s a lot of focus on gas right now,” Bond said. But “fuel diversity is the only safe place to be for a utility.” Nuclear power may have stable fuel prices, but it faces an unstable regulatory environment subject to public doubts and political winds. That’s why the Nuclear Energy Institute is touting the results of a poll it released this week. “We just did a survey, and we had a strong majority of Americans–81 percent–who believe that nuclear energy is important for the nation’s future energy needs,” said Alex Marion, NEI’s vice president for nuclear operations. “Eighty-two percent believe the U.S. should continue to develop nuclear

energy to meet growing electricity demand, and about the same percentage support the idea of renewing operating plant licenses, as long as they meet NRC regulatory requirements. “And 74 percent believe the nuclear power plants operating in the U.S. are safe and secure. So there is public support.” Support for nuclear power had dropped to 46 percent in the wake of the Fukushima accident, Marion said. NEI conducts polls in part to encourage politicians to support nuclear power. “Many of them are hesitant to go public because they’re afraid their constituents may not like nuclear and they don’t want to upset their constituents. So we develop these kinds of opinion surveys and we provide them to Congressional staff and members of Congress.” The panelists expect new nuclear plants to take the form of small modular reactors and, eventually, fast breeder reactors. They were much more optimistic about the outlook for new reactor designs than a panel held at the University of Chicago in the wake of the Fukushima accident. At that event, Hussein Khalil, director of Argonne’s Nuclear Energy Division, said safer reactor designs are impeded by industry reluctance to invest in them. Wednesday’s panelists said the NRC’s new “one-step licensing” procedure will overcome that obstacle. Instead of seeking NRC approval for each new reactor design, a costly and uncertain procedure, utilities will have the option of choosing from pre-approved designs.

Nuclear energy is at the tipping point- status quo action will be decisiveFroggatt & Schneider et al., nuclear energy consultants, ‘13

[Antony, Mycle, Komei Hosokawa, Professor for Environmental and Social Research, Kyoto Seika University, Japan, Steve Thomas, Professor for Energy Policy, Greenwich University, U.K., Yukio Yamaguchi, Co-director of the Citizen's Nuclear Information Center (CNIC), Tokyo, Japan, Julie Hazemann, Director of EnerWebWatch, Paris, France, Green Political Foundation, July 11 th 2013, “World Nuclear Industry Status Report 2013” http://www.worldnuclearreport.org/IMG/pdf/20130716msc-worldnuclearreport2013-hr-v4.pdf, 07/18/2014, PD]

On 29 June 2013, the Director General of the International Atomic Energy Agency (IAEA) declared at the Ministerial Conference in St. Petersburg, Russia that “nuclear power will make a significant and growing contribution to sustainable development in the coming decades”. 17 The future will show whether or not nuclear power will play an increasing role. In the meantime, the World Nuclear Industry Status Report 2013 (WNISR) provides a reality check of the current situation and trends of an industry that in the past has rarely been able to fulfill its own promises. The 2012 edition of the WNISR demonstrated that the IAEA consistently overestimated the development of nuclear power in the world18, a side-effect of “the leading role of the IAEA in promoting peaceful uses of nuclear energy”. 19 Contrary to the IAEA’s hopes for the future, this edition of the WNISR shows that nuclear power generation experienced a drop of 7 percent in 2012, larger even than the previous year’s record 4 percent decline. As in previous editions, this report provides many diverse health indicators of the nuclear industry, including numbers of reactors operating, under construction, installed capacities, and extensive country-by-country assessments of nuclear programs around the world. As in the past two editions, a chapter is included that compares certain trends in the nuclear industry with developments in the renewable energy industry.

New investment and innovation from companies have ensured a nuclear renaissance will happenBrewer, spent 15 years at world renowned Value Line, the publisher of The Value Line Investment Survey, before joining The Motley Fool Community, 3/9

[Rueben, 3/9/14, MotleyFool.com, “Is this the Start of the Nuclear Renaissance?”, http://www.fool.com/investing/general/2014/03/09/is-this-the-start-of-the-nuclear-renaissance.aspx, 7/19/14, JA]

Large-scale disasters like Fukushima and Chernobyl have given the nuclear power industry an image problem. However, there are signs that key nations aren't giving up on nuclear with industry developments setting the stage for a potentially bright future. ¶ The perfect example¶

Fukushima is the perfect example of nuclear's image problem. The reactors at this site were designed by General Electric (NYSE: GE ) and put in place in the late sixties and early seventies. They've been running without major problems for around 40 years. However, like the airline industry, when something goes wrong at a nuclear plant it usually goes wrong in a big way.¶

Japan shut all of its reactors after the Fukushima meltdown to help ensure that nothing like this ever happens again. That, of course, is a good call, since it is better to be safe than sorry—especially when nuclear disasters are such large-scale events. However, GE is still working in the nuclear space and, well, it's learned a lot over the last 40 years.¶ (Source: US EPA)¶ A new partnership¶ For example, GE was involved in the first commercially funded nuclear plant. Today, it has design options that are three and four generations removed from that plant on the technology front. The most recent designs, PRISM reactors, actually use spent nuclear fuel to generate electricity. And it isn't the only one working on such fourth-generation technology.¶ For example, Babcock & Wilcox (NYSE: BWC ) has just teamed up with Bill Gates backed TerraPower on its "Generation IV traveling wave reactor (TWR)." That's a feather in Babcock & Wilcox's hat, and the TerraPower reactor just happens to use depleted uranium as a fuel, too.¶ (Source: World Economic Forum, via Wikimedia Commons)¶ Carbon is today's hot buzzword, but nuclear plants also help avoid all of the other pollutants that come from burning carbon-based fuels, too. And this commitment to helping Southern build the first nuclear plants in the U.S. in 30 years shows that, despite the disaster in Japan, the United States continues to see a role for nuclear. Energy Department Secretary Ernest Moniz noted the deal as a part of the government's efforts to "jump-start the U.S. nuclear power industry." ¶ That technology, however, is the future -- so what about the present? Southern Company (NYSE: SO ) just received $6.5 billion in government loan guarantees for, "the construction of two new nuclear reactors at the Alvin W. Vogtle Electric Generating Plant." According to The U.S. Department of Energy, "The nuclear facility is eligible for loan guarantees since it is expected to avoid nearly 10 million metric tons of carbon dioxide emissions annually."¶ Giving nuclear a second chance¶ Even Japan has decided it should revisit its total shutdown. For example, Grant Isaac, CFO of pure-play uranium miner Cameco (NYSE: CCJ ) , noted late last year that "There are six utilities representing 16 reactors that are currently in the restart process" in Japan. Although no decisions have been made, it's highly likely that Japan will eventually go nuclear again.¶ As new technologies from the likes of GE, Babcock & Wilcox, and TerraPower continue to improve the safety and reliability of nuclear power, look for more support to build for nuclear. In the meantime, watch developing nations like China and

India. While the U.S. is looking to "jump-start" its nuclear industry, Cameco expects there to be three times as many reactors operating in China in 2022 (59) as there were in 2013 (19). It projects that India will go from 21 reactors to 36.

The uranium industry is rising, signifying a nuclear renaissance in the immediate future- uranium prices have been the only factor holding the nuclear industry backGuenther, the managing editor of The Rude Awakening. Greg is a member of the Market Technicians Association and holds the Chartered Market Technician designation, 3/5

[Greg, 3/5/14, DailyReckoning.com, “The Return of the ‘Nuclear Renaissance’”, http://dailyreckoning.com/the-return-of-the-nuclear-renaissance/, 7/19/14, JA]

Three years ago the “Nuclear Renaissance” was getting underway.¶ The price of yellowcake uranium was on the rise, our resource maven Matt Insley reminds us, and uranium miners were seeing their best run-up since 2007.¶ Of course, this was before the Japanese tsunami struck in 2011, creating a nuclear disaster that threw the industry into a tailspin. As the Fukushima disaster unfolded, the crippled Tokyo Electric Power Co. nuclear power plant led to Japan suspending its fleet of reactors.¶ And the nuclear panic didn’t stop there…¶ “Uranium prices tumbled and miners quickly turned from renaissance plays into retrenchment plays,” Matt explains. “Japan shuttered its entire fleet of nuclear power plants and the outlook for the yellowcake was uncertain. Heck, even Germany came out with an announcement that it too would be shutting down its entire nuclear power plant fleet.”¶ Of course, there was fallout.¶

Uranium prices have slumped 47 percent since the March 2011 earthquake and tsunami, Bloomberg reports. In fact, most investors left many uranium investments for dead.¶ But right now, we’re seeing some serious signs of life in this sector… ¶ Global X Uranium ETF vs. S&P 500, 2014-Present¶ “Flash forward three years and the uranium industry is dusting itself off,” Matt continues. “Japan recently announced it would begin powering up its nuclear power plants. This is music to the ears of miners and could be a return to grace for a nuclear renaissance.”¶ The charts don’t lie. Uranium-related plays are quickly becoming some of the best performing investments of the year. You can see from the above chart that the Global X Uranium ETF (NYSE:URA) is dominating the S&P 500 so far this year, rising more than 21%. We suggest you keep an eye on this market as the year progresses.¶ Regards,¶ Greg Guenthner¶ for The Daily Reckoning¶ P.S. In this morning’s issue of The Rude Awakening, I gave my readers a chance to discover an opportunity to get their hands on even more power-packed uranium investment ideas. Not only that, I also gave them a shot at discovering my absolute favorite uranium play for 2014. And that’s in addition to a complete rundown of the trends I’m currently following and 5 specific numbers to watch as the trading day continues. If you’re not reading The Rude

Awakening email edition, you’re not getting the full story – or any of the great opportunities packed into every issue. Sign up for FREE right here, to fix that.

Link - RenewablesThe only possible way renewables would be able to compete with nuclear power would be through governmental support like the affMormamm, contributor to the New York Times and a fellow at the Stanford’s Steyer-Taylor Center for Energy Policy and Finance, Reicher, executive director at Stanford’s Steyer-Taylor Center for Energy Policy and Finance, 2012

[Felix and Dan, 6/1/12, The New York Times, “How to Make Renewable Energy Competitive”, http://www.nytimes.com/2012/06/02/opinion/how-to-make-renewable-energy-competitive.html?pagewanted=all&_r=0, JA, 7/18/14]

Renewable energy needs help. Technological innovation has significantly reduced the cost of solar panels, wind turbines and other equipment, but renewable energy still needs serious subsidies to compete with conventional energy. Today, help comes mostly in the form of federal tax breaks. These tax incentives, and the Congressional battle over extending them for wind projects beyond the end of this year, mean that other, more powerful policies to promote renewables are not getting the attention they deserve. If renewable energy is going to become fully competitive and a significant source of energy in the United States, then further technological innovation must be accompanied by financial innovation so that clean energy sources gain access to the same low-cost capital that traditional energy sources like coal and natural gas enjoy. Two financial mechanisms that have driven investment in traditional energy projects — real estate investment trusts and master limited partnerships — could, with some help from Washington, be extended to renewable energy projects to lower their cost and make America’s energy future cleaner, cheaper — and more democratic. Federal support for renewable energy today consists primarily of two tax breaks: tax credits and accelerated depreciation rates. But both tools have a very limited reach. Only investors with hefty tax bills, typically big banks or corporations, can exploit them to reduce their tax burden. Most potential investors, including tax-exempt pension funds and, importantly, retail investors trading stocks, don’t have big enough tax bills to exploit the break. As a result, the few remaining players whose considerable tax bills place them in the market for tax breaks are able to demand returns of up to 30 percent for investing in renewable energy projects — an investment known as “tax equity.” There are better options. They may sound wonky, but they could prove revolutionary. Real estate investment trusts, or REITs, which are traded publicly like stocks, could tap far broader pools of capital to vastly lower the cost of financing renewable energy. REITs have a market capitalization of over $440 billion while paying shareholders average dividends below 10 percent — roughly a third of the cost of tax equity investments for renewable energy. Master limited partnerships carry the fund-raising advantages of a corporation: ownership interests are publicly traded and offer investors the liquidity, limited liability and dividends of classic corporations. Their market capitalization exceeds $350 billion. With average dividends of just 6 percent, these investment vehicles could substantially reduce the cost of financing renewables. But current law makes using both of these investment vehicles for renewable energy difficult if not impossible. Washington could help in two ways. First, the Internal Revenue Service needs to clarify the eligibility of renewable power generation for REIT financing. Second, Congress needs

to fix a bizarre distinction in the tax code that bars master limited partnerships from investing in “inexhaustible” natural resources like the sun and wind, while allowing investments in exhaustible resources like coal and natural gas. In 2008, as surging gasoline prices were infuriating American voters, Congress amended the tax code to enable master limited partnerships to invest in alternative transportation fuels like ethanol. We should treat power sources, like wind and solar farms, similarly. There is hope. Senator Chris Coons, Democrat of Delaware, plans to introduce a bill to allow master limited partnership investment in renewable energy. This approach is preferable to a recent proposal by Senator Bernard Sanders, independent of Vermont, and Representative Keith Ellison, Democrat of Minnesota, to eliminate this investment option for fossil-fuel projects. Both moves would level the playing field between conventional and renewable energy, but the Coons bill does so by promoting, rather than limiting, economic growth across the energy industry. These approaches could help renewable energy projects reduce their financing costs up to fivefold. These cost improvements could significantly reduce the price of renewable electricity and, over time, erase the need for costlier subsidies. Of course, making renewable energy eligible for master limited partnership and REIT financing would amount to a new kind of subsidy, because both are exempt from income tax. Indeed, some members of Congress fear that expanding master limited partnerships will erode the federal tax base. We don’t think so. Investors in master limited partnerships and REITs still pay taxes on dividends. Moreover, these investments would most likely bring many more renewable energy projects online, actually raising overall tax revenue. A more valid concern is whether renewable energy master limited partnerships might be abused as tax shelters, reminiscent of what happened in the 1980s California “wind rush.” Back then investors cared more about putting turbines in the ground to secure tax credits to lower their tax bill on other income than whether the machines actually produced electricity. History, however, need not repeat itself. Renewable energy master limited partnerships can guard against such abuse by ensuring that these tax privileges actually result in green electricity. There’s another benefit to expanding the pool of renewable energy investors: It would help democratize, and thus build support for, these new energy sources. Today, all American taxpayers fund renewable energy subsidies, but only a deep-pocketed few can cash in on the tax benefits. Publicly traded master limited partnerships and REITs would empower all Americans to invest and have a stake in the transition to cleaner energy. Renewable energy has come a long way since the 1970s energy crisis but much work remains. We must complement continued technological innovation with critical financial innovation — to level the playing field, incentivize growth, reduce subsidies and democratize America’s energy future.

Renewables investment is zero-sum with nuclearEnvironmental News Network, news station that focuses on environmental issues, ‘13

[ENN, 07/18/2013, ENN, “Renewable Energy Sources On the Rise” http://www.enn.com/pollution/article/46227, 07/18/2014, PD]

The reasons why we are turning to renewables isn't purely environmental as the rise in renewables is tied to both prices (the underlying cost of solar panels and wind turbines has gone

down) and policy (government incentives to installers of equipment or renewable energy targets in various states), Simon said. Overall, Americans used 2.2 quadrillion BTU, or quads, less in 2012 than the previous year (BTU or British Thermal Unit is a unit of measurement for energy; 3,400 BTU is equivalent to about 1 kW-hr). Out of the renewables, wind power saw the highest percentage gains, going from 1.17 quads produced in 2011 up to 1.36 quads in 2012. New wind farms continue to come on line with bigger, more efficient turbines that have been developed in response to government-sponsored incentives to invest in renewable energy. Solar jumped from 0.158 quads in 2011 to 0.235 quads in 2012. This can be attributed to declining prices of photovoltaic panels. The charts also show that 2012 is the first year in at least a decade where there has been a measurable decrease in nuclear energy. "It is likely to be a permanent cut as four nuclear reactors recently went offline (two units at San Onofre in California as well as the power stations at Kewaunee in Wisconsin and Crystal River in Florida)," Simon said. "There are a couple of nuclear plants under construction, but they won't come on for another few years."

Renewables incentives and investment trade off with nuclear powerWoods, journalist, ‘13

[Lucy, 07/12/2013, Photovoltaics International, “Report: Renewable energy overtaking declining nuclear,” http://www.pv-tech.org/news/solar_overtakes_nuclear_in_global_energy_output, 07/18/2014, PD]

The World Nuclear Industry Status Report 2013, published yesterday, was written by numerous academics and independent energy consultants as a “reality check” on global use of nuclear energy. It claims that with global electricity generation from nuclear decreasing “historically” by 7% last year, nuclear power is in decline as a power source compared to renewable energies. The report singled out solar and wind as energy forms that were beginning to rival nuclear. It said that 80% of those it surveyed thought renewables would be able to compete with major power and utilities sectors, and that “all forms of solar will not need subsidies to compete” by 2030. The largest investment in renewable energy was in utility-scale renewable energy parks, and second was in rooftop solar PV installations. A graph in the report shows in 2011, a peak of US$300 billion was invested in new renewables in comparison with just a few billion on new nuclear projects, calling the total investment in nuclear as “nearly an order of magnitude lower” than that for renewable energy. One of solar’s major advantages over nuclear is the average construction time, at 8-15 years depending on the countries experience. The report states the costs of renewable energy construction has fallen, whereas nuclear energy construction costs have risen. The report claims that now “new nuclear power plants are amongst the most expensive generation options available”. There is significantly less construction and growth of nuclear, or plants are running for fewer hours, producing less energy and lowering prices to compete with other energy sources. Now “nuclear investment and deployment has been outstripped by renewable energy” and renewables are now seen as a “major competition”, it said.

Impact - WarmingNuclear Energy is a baseload power source that will solve warming- licensing and technological improvements have made it cost competitiveStepp, Energy Trends Insider for CS Science, 13

[Mathew, 6/18/13, CS Science, “Fighting Climate Change with Nuclear Energy”, http://www.csmonitor.com/Environment/Energy-Voices/2013/0618/Fighting-climate-change-with-nuclear-energy, 7/18/14, JA]

In the last week, two news stories really captured the potential future for nuclear energy. The New York Times Matthew Wald reported from Georgia, where construction crews are slowly building the first two new nuclear reactors in thirty years. And National Geographic’s Will Ferguson reported from Tennessee that engineers and scientists are taking core samples and mapping regional geology as part of the early planning stages of building the first small modular nuclear reactor in the world. Both projects face unique challenges, yet they both represent the beginning of two potential nuclear paths for reducing climate-warming carbon emissions in the United States (and potentially the world). Big-Box Nuclear Energy Innovation in Georgia The nuclear generators we are all familiar with is physically recognized by large, curved cooling towers and billowing white steam, and pragmatically recognized as a significant source of carbon-free electricity. Big-box nuclear reactors across the United States provide about 19 percent of all electricity. But for thirty years, the nuclear energy industry has remained stagnant. Due to a mix of factors including more stringent regulation, rising construction costs, falling fossil fuel prices, and the Three Mile Island meltdown, no new nuclear power plants were developed. That changed in 2009, when the Department of Energy provided an $8.3 billion loan guarantee for the Alvin Vogtle nuclear project, aimed at constructing two new reactors. In 2012, the Nuclear Regulatory Commission (NRC) gave its approval and construction began. Vogtle, along with the two reactors under construction at the Virgil Summer Nuclear Generating Station in South Carolina, represent the “next-generation” of large-scale, traditional nuclear power. Recommended: US energy in five maps (infographics) In particular, the $14 billion 2234 MW Vogtle project utilizes two innovations, one regulatory and the other technological. The first innovation is the projects use of the NRC’s combined construction and operating licensing agreement. Previous to Vogtle, nuclear plants received one NRC license previous to construction and then one after construction, but before operation. The split-process added considerable cost and delay to new power plant construction, which in some cases stalled or completely stopped operation of constructed plant. Most famously, the Shoreham nuclear site on Long Island incurred cost overruns due to NRC regulatory changes and ultimately never began full operation after local authorities failed to provide evacuation plans required for licensing. Instead the new combined license process requires overcoming development barriers before construction begins. The NRC does so by pre-approving the reactor design, which provides regulatory certainty and reduces potential cost overruns during construction. NRC pre-approved Vogtle’s (and Summer’s) chosen reactor design – the Westinghouse AP1000 – in 2011. The second innovation is the AP1000 nuclear reactor design itself. It’s the most advanced pressurized water reactor ready for commercial use and purports to be safer and more reliable

than existing reactors. In particular, the AP1000 utilizes a passive cooling system that can automatically keep the reactor safe from meltdown for at least three days without any operator interaction. It also produces more energy, but houses less pumps, pipes, and valves compared to previous generation designs, further increasing safety and reducing costs. Small-Box Nuclear Energy Innovation in Tennessee While the nuclear industry continues to push for more construction of big-box nuclear plants, emerging technologies are showing progress. In particular, small modular nuclear reactors (SMRs) are taking the first step from theoretical design to commercial pilot projects. SMR innovations potentially solve a key problem with traditional nuclear technologies: up-front costs. While nuclear-generated electricity is relatively cheap once operation begins, it can cost $10 to $20 billion to successfully develop a new plant — something only a handful of energy companies are capable of doing even with federal loan guarantees. SMR companies believe they can construct a plant for roughly $2 billion, or one-fifth the cost. Of course, one SMR reactor won’t provide the same output as one big-box reactor, but this actually creates flexibility. SMRs can be stacked together to meet a particular region’s power need, so less populated regions can invest in less SMR reactors while more populous regions can add more, if necessary. Power generators can also begin operating SMRs even while installing additional modules, so energy companies can begin recouping up-front costs much earlier than if building a large traditional reactor, which can’t be turned on until construction is complete. SMR companies hold that additional cost reductions will come from the potential to mass-manufacture SMR reactors and ship to construction sites rather than on-site assembly of big-box plants (though, some parts of the Vogtle project are doing this as well). In addition, SMRs provide unique safety benefits, such as the potential for air-cooled passive safety systems, rather than traditional water cooled systems used today, as well as the ability to remove the entire reactor in one piece rather than disassemble it piece by piece. The Tennessee SMR project developing along the Clinch River is the first demonstration under the Department of Energy’s SMR program. Specifically, the DOE is investing $452 million over 5 years to accelerate the licensing of SMR designs to provide regulatory certainty so that private companies can begin developing them across the United States. Babcock & Wilcox’s mPower design — an 180 MW pressurized water reactor— is the first to gain support from the program to begin completing design certification, the aforementioned site geology, NRC design licensing, and early-stage engineering activities. The project has access to a unique partnership with the publically-funded Tennessee Valley Authority (TVA), which could act as an end-use customer once the SMR is constructed. DOE has a solicitation to support a second next-generation design, which it intends to announce by the end of the year. Nuclear Energy Innovation’s Role in Addressing Climate Change Nuclear is currently the only carbon-free energy source that can provide base load electricity — a characteristic crucial to reducing global greenhouse gas emissions. In contrast, renewables at increasingly high penetration rates require either utility-scale energy storage (which isn’t cost or performance competitive yet) or peaking natural gas plants to balance spikes in demand. In fact, California’s carbon emissions are set to increasebecause it closed the San Onofre nuclear generating station, which produced one-tenth of California’s electricity, and is quickly working to replace it with a mix of natural gas and renewable technologies. The same situation has occurred in Germany and Japan. Like renewable energy the critical barriers to large-scale nuclear deployment are cost and uncertainty. With big-box nuclear plants, cost and construction setbacks continue to plague development. As Matthew Wald found, Vogtle’s

construction, “…is not going as planned, and that the schedule — which is closely linked to cost…has slipped by at least 14 months and possibly more.” And as Will Ferguson reported, DOE’s SMR support only extends to licensing and early-siting, not construction. As of today, no power provider, including the TVA, has agreed to actually finance the SMR demonstration once licensing is complete. Up-front costs of big-box plants and the valley-of-death support for SMRs are the most immediate barriers to expanding nuclear power. It’s not clear whether big-box nuclear energy will ever reduce its cost-overruns and SMRs may make this issue entirely moot by providing a cost-competitive alternative. And of course, these projects are in addition to DOE research investments to develop next-generation designs, materials, and safety technologies as well as continuing work in fusion energy. Nonetheless, there is substantial opportunity to incorporate next-generation nuclear energy — through either large, advanced reactors or emerging SMR designs or both — more significantly into a productive strategy for reducing carbon emissions in the long and short term.

Nuclear power’s great- empirically proven to be economically feasible, already developed, and the only viable alternative to fossil fuelsDyson and Bennett, chairman of Millbrook Capital Management and Senior Vice President for Public Affairs @ Third Way, ‘07

[John and Matt, New York Times, 09/18/2007, “Just say 'oui' to nuclear power,” http://www.nytimes.com/2007/09/18/opinion/18iht-edbgdyson.1.7550206.html?_r=0, 07/18/2014, PD]

Global warming is positioned to be a hot issue in the 2008 U.S. presidential election, and candidates in both parties must face directly the one large-scale means of providing carbon-free electric power: nuclear energy. For Democrats, that means acknowledging that we need more nuclear power and that we must do something with the waste. Republicans must admit that we should become more like France. In any case, the nuclear industry, which was once in decline, is on the brink of substantial growth for the first time in 30 years. Demand is one reason. A growing population combined with the rise in thirsty electric products, means an estimated 45 percent increase in demand for power in the United States by 2030. We'll need massive new generating capacity to meet that demand. And while we must do better at conservation and renewable energies, nuclear power is the only mature, large-scale source of power that is essentially carbon-free. In 2005, nuclear power produced 19 percent of all electricity in the United States; solar made up 1/30 of 1 percent. If we don't build substantial new nuclear capacity, the alternative isn't going to be wind farms and solar arrays - it's going to be fossil-fueled, carbon-spewing plants.

Nuclear energy is a natural solution to warming- arguments against nuclear power are the result of polarizing global warming discourse, not evidentiary supportAngwin, former project manager @ Electric Power Research Institute, ‘12

[Meredith, 07/11/2012, The Energy Collective, “Carbon Dioxide and Nuclear Energy: The Great Divide and How to Cross It,” http://theenergycollective.com/meredith-angwin/92451/carbon-dioxide-and-nuclear-energy-great-divide-and-how-cross-it, 07/18/2014, PD]

To some extent, these attitudes show logical disconnects. Nuclear is a low-carbon choice. If a person claims to be very concerned with global warming and is also against nuclear energy---that person is showing a logical disconnect, in my opinion. Nuclear is preferable to fossil. Even without considering global warming, there are many reasons to prefer nuclear to fossil power. I moved into nuclear energy in the early 80s. (I had been working in renewables and fossil.) In those days, people were not concerned about global warming. I still saw many advantages of nuclear over fossil fuels. An Interview with an Environmentalist In the "Cult Versus Cult" article, Tucker quotes William McKibben, a well-known author and Scholar in Residence at Middlebury College in Vermont. McKibben is very active in fighting global warming. He founded 350.org, which describes itself as a "global movement to solve the climate crisis." (I am happy to note that the 350.org website doesn't bash nuclear.) In the article, Tucker describes a scene at a solar festival. McKibben had just addressed the group. Tucker notes that many of McKibben's followers are wearing "Close VY" buttons, and Tucker asks McKibben why he doesn't support nuclear power. Tucker wrote: McKibben looked wistfully at the hillside filled with long-haired hippies. "I understand what you're saying," he said. "But supporting nuclear right now would split this movement in half." UPDATE: Bill McKibben has emailed me to say that this quote does not reflect his opinions. He has also commented on the original post at Yes Vermont Yankee. I include his entire comment below. This story about me isn't accurate. I've been opposed to Vermont Yankee for a long time--it's badly run, and its owners have repeatedly lied to people. I believe Vt. is completely capable of replacing (and far more) its power output with renewables, which is why my roof is covered with solar panels. Founding a Movement With 350.org, McKibben founded a global movement to solve the climate crisis. In the quote above, he says that supporting nuclear would hurt that movement. To me, this implies that he is more interested in the growth of his movement than in carbon dioxide results for the planet. But what about me? There's an old saying that when you point a finger at someone else, look where the other fingers are pointing. I just pointed at McKibben, and the other fingers are pointing back at me. I'm trying to encourage people to support the continued operation of Vermont Yankee. It's a smaller scale movement than "solving the climate crisis," but Howard Shaffer and I are growing a pro-nuclear, pro-Vermont Yankee movement. What are we willing to do to support it? Well, among other things, in order to support the pro-Vermont Yankee movement, I rarely talk about global warming. The Divide I personally think the world-wide carbon dioxide increase is mostly man-made and causes some level of global warming. I think global warming is a threat to human life and health, but it is not the most over-arching threat we face. In the past few years, many environmentalists have embraced nuclear power because of their concern with global warming. However, a significant portion of the people who support Vermont Yankee do not think global warming is a threat. This divide is not just an issue for Vermont. It's a bigger issue. Global warming divides people in many areas, and it divides the pro-nuclear community. For example, one pro-nuclear discussion board has banned discussion of global warming because people were getting too acrimonious. For myself, I rarely talk about global warming in context of Vermont Yankee. I know the discussion could get too acrimonious, and I could alienate some of the plant's supporters. Apparently, McKibben doesn't talk about nuclear power in his "solve

climate change" movement. He probably has the same reasons: talking about nuclear power could get too acrimonious, and he could alienate some of his supporters. Are McKibben and I birds of a feather? At one level, yes. We are two people, dealing with the huge climate-change divide and trying to keep our supporters . At another level, our strategies are quite different. Though McKibben and I seem to be good illustrations for the problem, I don't want to keep writing only about the two of us. "How people speak about global warming" is a more general issue. The Difference If a pro-nuclear speaker decided to talk about nuclear energy as helping to prevent global warming, that person would gain some supporters and lose some. If an environmentalist admitted that nuclear energy could help prevent global warming, that person would also gain some supporters and lose some. So far, the situations seem parallel. However, these strategies are not actually parallel. If the nuclear supporter decides not to talk about global warming, that person is choosing her rhetoric, not her technology. I can make several arguments in favor of nuclear power. Global warming is one pro-nuclear argument, but I rarely use it. In other words, I select my rhetoric: global warming is very controversial, and it pulls the discussion into directions which are not relevant to Vermont Yankee. However, if an environmentalist decides not to talk about nuclear for fear of losing followers, that person is selecting technologies based on what the followers will accept. That is more than a rhetorical choice. The choice of technologies will affect the results of climate change strategies. Another Environmentalist (maybe) for Nuclear Power Some environmentalists have embraced nuclear energy, but others have not. I am cheered by the ones (like Stewart Brand, George Monbiot and Gwyneth Cravens) who endorse nuclear power. I hope that McKibben may someday bridge the great climate-change divide and join them. Still, in the bottom line, this is not about McKibben, and it's not about me. The problem is the great Climate Change Divide. It's almost impossible for anyone to have a truthful conversation amidst so much acrimony and hatred.

Renewables can’t solve warming- nuclear energy is the only alternative to fossil fuelsKloor, professor of environmental journalism @ NYU, ‘13

[Keith, 01/14/2013, Slate Magazine, “The Pro-Nukes Environmental Movement,” http://www.slate.com/articles/health_and_science/nuclear_power/2013/01/nuclear_energy_and_climate_change_environmentalists_debate_how_to_stop_global.html, 07/18/2014, PD]

James Hansen, NASA’s top climate scientist, is one of the most impassioned and trusted voices on global warming. People listen closely to what he says about how drastically the climate is changing.

But when Hansen suggests what to do about it, many of those same people tune him out. Some even roll their eyes. What message is he peddling that few seemingly want to hear? It’s twofold: No. 1, solar and wind power cannot meet the world’s voracious demand for energy, especially given the projected needs of emerging economies like India and China, and No. 2, nuclear power is our best hope to get off of fossil fuels, which are primarily responsible for the heat-trapping gases cooking the planet.

Many in the environmental community say that renewable energy is a viable solution to the climate problem. So do numerous energy wonks, including two researchers who penned a 2009 cover story in Scientific American asserting that “wind, water, and solar technologies can provide 100 percent of the world’s energy” by 2030. Hansen calls claims like this the equivalent of “believing in the Easter Bunny and Tooth Fairy.”

He’s not the only environmental luminary who is bullish on nuclear power. Last year, Columbia University’s Jeffrey Sachs, director of the Earth Institute, echoed Hansen’s argument. A number of other champions of nuclear power have stepped forward in recent years, from Australian climate scientist Barry Brook to American writer Gwyneth Cravens, author of Power to Save the World: The Truth about Nuclear Energy. A breakaway group in the traditionally no-nukes environmental movement has also begun advocating passionately for nuclear power. That story is the subject of a new documentary that is premiering this month at the Sundance Festival.

These are not corporate stooges of the nuclear industry; to a person, their embrace of nuclear power is motivated by a deep concern about climate change and the conviction that no other carbon-free source of energy is sufficient (and safe) enough to replace coal and gas. They see themselves as realists who want to solve the full equation of global warming and energy, not a fantasy version of the problem.

The stark reality of the challenge at hand is that the global politics of climate change has stalled. Few countries are willing to make economic sacrifices to reduce their carbon emissions.

Another reality is this: Coal is the source of nearly half the world’s energy. The International Energy Agency (IEA) released a report last month projecting that the trend will increase throughout the decade. “In fact,” according to IEA executive director Maria van der Hoeven, “the world will burn around 1.2 billion more tons of coal per year by 2017 compared to today—equivalent to the current coal consumption of Russia and the United States."

Hoeven said the “the biggest hope for reducing emissions from coal plants” globally was natural gas, which has already started to happen in the United States. Although natural gas is cleaner than coal, it too is a major source of greenhouse gases and prolongs our dependence on dirty energy. Then there is the controversial issue of fracking. The drilling technology has helped usher in a huge gas boom but has also triggered much grassroots opposition due to a new set of environmental concerns. Prominent greens were touting natural gas as a bridge to a clean energy future just a few years back, but if anything, gas seems to have put off investments in clean energy.

Where does that leave us? Some environmentalists continue to insist that renewable energy (primarily solar and wind) can provide enough juice to power the world. The Energy Collective, a site that boasts “the world’s best thinkers on energy & climate,” recently put up a piece titled: “100 Percent Renewable: The Only Way Forward.” (In fairness, the site features a broad range of views.) The article describes the climate imperative and states: “If human beings are to preserve modernity and planetary habitability, we must soon shift to 100 percent renewable energy in all sectors.”

This is, to put it charitably, wishful thinking. Renewable energy analyst Vaclav Smil lays out the major drawbacks with wind and solar: The energy it produces is intermittent, there is marginal storage capacity, it is still too costly, and it takes too long to scale up to become a meaningful substitute for coal. Community opposition to the industrialized footprint of solar installations and wind farms is increasing.

AT: Proliferation TurnNew technology and international organizations solve proliferationGrape, Department of Physics and Astronomy, Uppsala University, Svard, Department of Physics and Astronomy, Uppsala University, 6/26

[Sophie, Staffan Jacobbson, 6/26/14, “New perspectives on nuclear power—Generation IV nuclear energy systems to strengthen nuclear non-proliferation and support nuclear disarmament”, Energy Policy, Volume 10: Number 16, 276-291, JA]

There are many reasons to believe that nuclear power will play an¶ important role in future society, together with a mix of other energy¶ sources. Nuclear power offers to deliver large, reliable quantities of¶ electricity associated with low greenhouse-gas emissions, which¶ proves more important by the day. Accordingly, current large¶ international efforts should be continued to develop Gen IV nuclear¶ energy systems, with the aim to provide dean, long-term sustainable,¶ safe, economic and efficient electricity production.¶ Among the new perspectives that Gen IV systems bring are their¶ capability to contribute to the world's security in additional, valuable¶ ways as compared to today's nuclear power, by offering means to¶ control and reduce the amount of nuclear waste generated, and to aid¶ the nuclear disarmament process by turning warheads into peaceful¶ electricity. In this paper, we have shown an example of how a country¶ with considerable use of nudear power can launch fast reactors to¶ control and reduce the amounts of plutonium generated, and thereby¶ mitigating the proliferation hazard. The operation of these Gen IV¶ systems can be extended until other climate-friendly, reliable energy¶ systems are implemented, and accelerator-driven burners enable a¶ complete destruction of the country's plutonium inventory.¶ There are many challenges associated with Gen IV nuclear¶ energy systems: technical as well as political and social. In this¶ context, nuclear safeguards and non-proliferation of nuclear¶ weapons is highly important, especially as nuclear safeguards will¶ become more challenging with an envisaged expansion of nuclear¶ technology. Accordingly, Safeguards-by-Design principles should¶ be implemented, allowing for more reliable, efficient and eco-¶ nomic international safeguarding of sensitive materials.

The NPT and CTBT solve any risk of nuclear proliferation and ensure the peaceful use of nuclear energyCTBTO.org, preparatory commission for the comprehensive nuclear test ban theory organization, 2010

[7/2010, CTBTO.org, “NON-PROLIFERATION AND DISARMAMENT CONFERENCE REACHES CONSENSUS”, http://www.ctbto.org/press-centre/highlights/2010/non-proliferation-and-disarmament-conference-reaches-consensus/, 7/19/14, JA]

Lots of applause in the room, huge sense of relief,” Rebecca Johnson, a well-known arms control expert, noted on the afternoon of Friday, 28 May 2010. After four weeks of intense negotiations, 189 countries agreed on the final document of the 2010 Review Conference of the Parties to the Treaty on the Non-Proliferation of Nuclear Weapons (NPT).

“This is crucial for reinvigorating multilateralism in general and nuclear non-proliferation and disarmament in particular,” said Tibor Tóth, the Executive Secretary of the Preparatory Commission for the Comprehensive Nuclear-Test-Ban Treaty Organization (CTBTO). “The agreement on concrete actions will advance all three pillars of the treaty – disarmament, non-proliferation and peaceful use of nuclear energy,” concluded United Nations Secretary-General Ban Ki-moon.

CTBT of vital importance

“The strong commitment of the Conference to the cessation of all nuclear explosions and the reaffirmation of the vital importance of the entry into force of the Comprehensive Nuclear-Test-Ban Treaty (CTBT) are significant pledges. There can be no strong NPT without a CTBT in force,” Tóth said. Among other provisions, the “Conclusions and recommendations for follow-on actions” adopted by the Conference reaffirmed the vital importance of the entry into force of the CTBT as a core element of the international nuclear disarmament and non-proliferation regime. “Putting an end to nuclear explosions is […] one of the longest-standing goals of the United Nations,” said Ban on the margins of the Conference.

Aff Answers

UniquenessThe Nuclear Renaissance will never happen- lack of private investments and governmental support- prefer recent evidenceEdwards, PhD in Mathematics from Queens University, cofounder and president of the Canadian Coalition for Nuclear Responsibility, 4/21

[Gordon, 4/21/14, ccnr.org, “Nuclear Renaissance on Hold”, http://www.ccnr.org/blog_no_renaissance_2014.pdf, 7/16/14, JA]

The nuclear renaissance was supposed to start in North America with ¶ a dizzying flurry of new orders, then spread to Europe -- and before ¶ long other countries would be buying them and building them like ¶ crazy. This has not happened and will not happen.

In North America the industry is definitely on the decline. A few years ¶ ago new CANDU reactors were going to be built in Canada -- two in ¶ Northern Alberta, one or two in Saskatchewan, a new CANDU ¶ (Lepreau-2) in New Brunswick, plus 2 new ones at Bruce, 2 new ones ¶ at Clarington, and 2-4 new ones at Darlington. All of these new ¶ CANDU projects have either been explicitly cancelled or put on a very ¶ distant back burner. Moreover the refurbishment of Pickering-B is not ¶ going ahead, so by 2020 or so the Pickering Nuclear Station will be a ¶ thing of the past. Quebec has phased out of nuclear power ¶ completely and AECL's reactor division has been sold for a song to a ¶ scandal-ridden SNC-Lavalin. The two isotope-producing MAPLE ¶ reactors were non-functional fiascos, and Canada will no longer be ¶ producing medical isotopes from nuclear reactors after 2016. The ¶ 57-year-old NRU reactor at Chalk River will likely be shut down for ¶

good. The Advanced CANDU reactor, ACR, under development for ¶ decades, is nowhere to be seen. Canada's nuclear future looks bleak.

In the USA, since the mid-2007s, there were 16 licence applications ¶ to build 24 new nuclear reactors. Most of these have since been ¶ cancelled. There has been no new ground-breaking for a new US ¶ nuclear power station since 1974 , and until 2013, no ground-breaking ¶ for new US reactors at existing nuclear stations since 1977 -- two ¶ years BEFORE the Three Mile Island accident. Meanwhile 5 older ¶ reactors have been permanently retired in the USA for economic ¶

reasons, bringing the number of US reactors down to 99 -- and it is ¶ expected that up to 13 more older US reactors may be retired in the ¶ next year or so. Gregory Jaczko, the Chairman of the US Nuclear ¶ Regulatory Commission at the time of the Fukushima disaster, has ¶ said repeatedly that all US nuclear plants should be shut down for ¶ safety reasons.

There are five reactors currently under construction in the USA: the ¶ Watts Bar 2 reactor (ice condenser design) in Tennessee, as well as ¶ the VC Summer in South Carolina, and Vogtle in Georgia (both of the ¶ latter are two AP1000 reactors each). Clearing (not officially defined ¶ as "construction") at the VC Summer and Vogtle sites actually began ¶ in 2007. All of these sites have existing reactors at them. None of ¶ these projects could obtain financing without lavish loan guarantees ¶ from the US Government.

In Europe, Sweden, Germany, Austria, Belgium, Italy and Switzerland ¶ have nixed nuclear power for future developments. Nuclear prospects ¶ in France are not bright , the Olkiluoto reactor in Finland is still ¶ struggling to see the light of day, and the UK nuclear program is ¶ looking more

desperate every year, though the official UK line is to go ¶ ahead and build a new fleet of nukes. Eastern Europe has shown ¶ more willingness to build new nukes, although recently the Czech ¶

Republic is showing signs of faltering in its nuclear plans.

The places where new reactors are much more likely to be built are ¶ Russia and parts of Asia, especially China and South Korea. A South ¶ Korean TV crew was just here last week (leaving for home today from ¶ Montreal) to interview Shawn-Patrick Stensil in Toronto, myself in ¶ Montreal, Michel Duguay in Quebec City, and Chris Rouse (of New ¶ Brunswick) in Ottawa, as well as CNSC people (mainly Dr. Gregory ¶ Rzentkowsky) in preparation for a 60-minute documentary that will be ¶ critical of the safety of CANDU reactors that will be aired in Korea.

We have learned that 70% of Koreans are now against nuclear ¶ power. Hundreds of people, some of them quite highly placed, ¶ are already serving prison terms in Korea for high-profile fraudulent ¶ activities in the Korean nuclear power field that compromise the ¶ safety of those reactors.

China is not expanding its nuclear fleet nearly as fast as people ¶ thought they would, and nuclear is only about 3% of their electricity ¶ anyway, but they are definitely building new reactors. Meanwhile, of ¶ Japan's 54 operating reactors on March 1 2011, four have been ¶

destroyed and the other 50 are all shut down. Although the Abe ¶ government wants to restart as many reactors as it can, it appears ¶ that only about a dozen will be able to meet the new safety standards ¶ to allow for a restart, assuming it proves politically possible to do so.

Even before the Fukushima disaster, many independent studies had ¶ concluded that the role of nuclear will continue to be on the decline ¶ for the next 20 years or more no matter how many new reactors are ¶ built, because the old ones will be closing down faster than the new ¶ ones can be built. Financing is a major problem, as no private ¶ concerns -- but only national or regional governments -- seem ¶ foolhardy enough to risk investing in new nuclear reactors.

The Nuclear Renaissance is a myth- no investors: inefficient, expensive, unsafePepper, columnist for The Stringer specializing in environmental issues and the nuclear free campaigner for the Conservation Council of WA, 3/26

[Mia, 3/26/14, The Stringer, “The Nuclear Renaissance that Never Was”, http://thestringer.com.au/the-nuclear-renaissance-that-never-was/#.U8dxSPldX0d, 7/16/14, JA]

The second anniversary of the Fukushima disaster has come and gone. But here in West Australia, rather than reflection on the lives affected by Australian uranium sold to and used at

the Fukushima Dai-ichi reactors, uranium hopefuls are celebrating the re-election of a pro-uranium Government at the same time as promoting the low uranium price to investors as a good time to buy. An advertisement by Energy & Capital finds an upside in the “life-long consequences” of “one of the worst nuclear disasters on record”. The upside is that uranium prices took a “nosedive” in the aftermath of the Fukushima disaster, China and India “will drive a new nuclear boom that will rival the first oil discoveries of the late 19th century”, and so there’s “no better time to invest in uranium than right now.” There are two problems with this. Firstly, it is deeply insensitive to the ongoing suffering in Japan. Two years after the Fukushima fires, explosions and meltdowns and 160,000 people remain dislocated in temporary accommodation, often separated from family and friends, and with little hope of a return to normality for some years to come. Secondly, the presumption of a “new nuclear boom” does not withstand scrutiny. The International Atomic Energy Agency anticipates 1.5 percent annual growth in nuclear power capacity until 2030. That’s not a boom; that’s not a nuclear ‘renaissance’. Growth in a few countries, including China and India, will be offset by stagnation and decline elsewhere. The nuclear industry often promotes figures on the number of new nuclear reactors that are dangerously skewed, they inflate the number of proposed reactors and fail to indicate the time and cost blow outs of the modest amount of reactors that are under construction. Rather than a renaissance the industry will struggle to maintain status quo. It is not just those in the nuclear free movement who see a nuclear renaissance as a mirage. The Economist in 2011 dubbed Nuclear power as the ‘dream that failed’, the Chief of General Electric said “It’s hard to justify nuclear, really hard.” Former CEO of Excelon, a US company that operate 22 nuclear reactors, said this; “Let me state unequivocally that I’ve never met a nuclear plant I didn’t like. It just isn’t economic, and it’s not economic within a foreseeable time frame.” Nuclear power has continually failed to deliver cheap energy, disappointing its most faithful supporters and has proved the anti nuclear lobby right time and time again with safety breaches, accidents, cover ups, secrecy, weapons proliferation and failure to develop waste storage. Nuclear power promised to be too cheap to meter – but in reality it has become too expensive to matter.

The Nuclear Renaissance is stone cold dead- investment is low and it still isn’t cost competitiveGreen, contributor to the Business Spectator, 1/9

[Jim, 1/9/14, The Business Spectator, “The Nuclear Renaissance Is Stone Cold Dead”, http://www.businessspectator.com.au/article/2014/1/13/nuclear-renaissance-stone-cold-dead, 7/19/14, JA]

The figures are in: 2013 was an annus horribilis for the nuclear power industry − its third in a row − and the nuclear renaissance can now be pronounced stone cold dead.

The most that could be said for the 2013 figures − four reactors connected to grids, four permanently shut down − is that they weren't as bad as the previous year. Nuclear power suffered its biggest ever one-year fall in 2012 − nuclear generation fell 7 per cent from the 2011 figure.

Nuclear generation fell in no less than 17 countries, including all of the top five nuclear-generating countries. Nuclear power accounted for 17 per cent of global electricity generation in 1993 and it has steadily declined to 10 per cent now.

The International Atomic Energy Agency has downwardly revised its projections, and now anticipates nuclear capacity growth of 23 per cent to 100 per cent by 2030. Historically, the IAEA's upper projections have been fanciful, while its low projections also tend to be too high (by 13 per cent on average) but provide a reasonable guide nonetheless. So growth of 23 per cent by 2030 − annual growth of a little over 1 per cent − is about as much as the industry can realistically hope for.

The IAEA will further reduce its projections when it factors in last year's annus horribilis. Perhaps the most striking developments were in the United States, where the industry is finding it increasingly difficult to profitably operate existing reactors − especially ageing reactors requiring refurbishments − let alone build new ones. Almost half of the world's reactors have operated for 30 years or more, so the problem of ageing reactors is starting to come into sharp focus.

Peter Bradford, a former member of the US Nuclear Regulatory Commission, notes that by 2009, applications for 31 new reactors in the US were pending. "The 31 proposed reactors are down to four actually being built and a few others lingering on in search of a licence, which is good for 20 years," Bradford writes. "Those four are hopelessly uneconomic but proceed because their state legislatures have committed to finish them as long as a dollar remains to be taken from any electric customer's pocket. Operating reactors are being closed as uneconomic for the first time in 15 years."

Last year alone, US utilities closed or announced plans to close five reactors in addition to cancelled plans for new reactors and cancelled plans to increase the power of existing reactors; Forbes recently listed another six nuclear plants that could be next for the chopping block; and academic Mark Cooper has identified 38 US reactors in a similar situation to those that have recently been shut down.

The UK has finally made some movement towards replacing its fleet of ageing reactors. The capital cost for two planned large reactors (totalling 3.2 gigawatts) at Hinkley Point in Somerset: a staggering $29 billion. Utilities can't find the capital, so the UK government is offering loan guarantees of $18 billion. And the UK government is guaranteeing French utility EDF a staggering 16 cents for every kilowatt-hour generated by the Hinkley Point reactors, fully indexed for inflation, for a staggering 35 years (EDIS: Britain's nuclear cost bombshell, October 30).

Economic consulting firm Liberum Capital said: "We are flabbergasted that the UK government has committed future generations of consumers to the costs that will flow from this deal" and that Hinkley Point will be "both the most expensive power station in the world and also the plant with the longest construction period".

EDF plans to build European Pressurised Reactors, EPRs, at Hinkley Point. Two other EPR projects − in Finland and France − have been disastrous. The estimated capital cost for the EPR in Finland has ballooned from $4.5 billion to $12 billion. The estimated cost for the EPR in France

has ballooned from $5 billion to $12.8 billion. Thus we have a rule-of-thumb for estimating the true capital costs of nuclear power: double the initial estimate and add a few billion for good measure.

While the costs of renewables are falling − and in the case of solar PV, plummeting − nuclear power is subject to a 'negative learning curve'. Economic boffins at Citigroup explain: "The capital cost of nuclear build has actually risen in recent decades in some developed markets, partly due to increased safety expenditure, and due to smaller construction programs (i.e. lower economies of scale). Moreover the 'fixed cost' nature of nuclear generation in combination with its relatively high price (when back end liabilities are taken into account) also places the technology at a significant disadvantage; utilities are reluctant to enter into a very long term (20-plus years of operation, and decades of aftercare provisioning) investment with almost no control over costs post commissioning, with the uncertainty and rates of change currently occurring in the energy mix."

The nuclear renaissance will not materialize- the academic and governmental studies of the pro-nuclear movement are skewed- nuclear energy can’t solve climate changeBradford, environmental contributor to The Guardian, 2013

[Peter, 7/11/2013, The Guardian, “Nuclear renaissance was just a fairy tale”, http://www.theguardian.com/environment/2013/jul/11/nuclear-renaissance-power-myth-us, 7/16/14, JA]

Nuclear power requires obedience, not transparency. The gap between nuclear rhetoric and nuclear reality has been a fundamental impediment to wise energy policy decisions for half a century now. For various reasons, in many nations the nuclear industry cannot tell the truth about its progress, its promise or its perils. Its backers in government and in academia do no better. Rhetorical excess from opponents of nuclear power contributes to the fog, but proponents have by far the heavier artillery. In the US, during the rise and fall of the bubble formerly known as "the nuclear renaissance", many of the proponents' tools have been on full display. Academic and governmental studies a decade ago understated the likely cost of new reactors and overstated their potential contribution to fighting climate change. By 2006, a few US state legislatures had been enticed to expose utility customers to all the risks of building new reactors. Industry-sponsored conferences persuaded businesses and newspapers of an imminent jobs bonanza, ignoring job losses resulting from high electric rates and passing up cheaper, more labour-intensive alternatives. These local groups added to the pressure on Congress for more subsidies. France and Japan were held out as examples of countries that had avoided the timidity and overregulation that had stalled nuclear construction in the US. Indeed, it was argued, these nations had even solved the waste problem through their commitment to reprocessing spent fuel. At times inconsistent tales were told simultaneously. Thus the US

Congress was told that the new licensing process and the new generic designs were so untried and environmental opposition so formidable that loan guarantees were needed to lay the risks off on taxpayers. At the same time, Wall Street and state legislatures were assured that these new features had chloroformed public opposition and otherwise laid to rest the terrifying industry ghosts embodied by the nine-figure dollar losses at Shoreham, Seabrook, WPPSS (Washington Public Power Supply System), and Midland, sites that resonate in US nuclear folklore like civil war battlefield names. The renaissance story line was hard to resist. By early 2009, applications for 31 new reactors were pending at the US Nuclear Regulatory Commission. The promises came garnished with tales of remorseful changes of heart from oft-obscure nuclear converts. With few exceptions, the news media – especially television, with its thirst for the short and the simple – fell for the rhetoric. It is all in ruins now. The 31 proposed reactors are down to four actually being built and a few others lingering on in search of a licence, which is good for 20 years. Those four are hopelessly uneconomic but proceed because their state legislatures have committed to finish them as long as a dollar remains to be taken from any electric customer's pocket. Operating reactors are being closed as uneconomic for the first time in 15 years. Still the band plays on. President Obama recently touted new reactors as part of his "all of the above" policy on energy. But is "all of the above" really a policy? Do we build palaces to avert housing shortages? Don't we instead prioritise, based on the best information available? US secretaries of energy enthuse that the four new reactors will be completed "on time and on budget", never mind that they are already behind and over and that "on budget" will mean "well above the cost of creating equivalent low carbon energy more sensibly". As always in the face of failure, the industry puts forth new designs as a basis for new promises, now touting small modular reactors with the same fervour with which it touted large, partially modular reactors a decade ago. Congress finds a few hundred million to preserve these dreams even as its cutbacks shatter so many others. A new movie, Pandora's Promise (no film-maker familiar with nuclear history would include "promise" in a title intended to be pronuclear), recently screened at Sundance.Featuring the same old converts and straw men, it opened in cinemas a few weeks ago to tiny audiences and generally unenthusiastic reviews, especially from reviewers knowledgeable about nuclear power. In the astonishing persistence of the global appetite for false nuclear promises lies the critical importance of the World Nuclear Industry Status Report, published on Thursday. It sets forth in painstaking detail the actual experience and achievements of nuclear energy around the world. It is based for the most part on generally accepted data distinctively graphed for clearer understanding. Where the authors introduce judgment, they explain what they have done and why. The report has a track record stretching back years. It is much better than the embarrassing exuberances of the International Atomic Energy Agency, the World Nuclear Association or the pronouncements of most national governments. Most of the myths on which the purported nuclear renaissance rested founder on the rocks of the information presented here. Is new nuclear power cheaper than alternative ways of meeting energy needs? Of course not. What about low-carbon "baseload" alternatives? See page 71 of the report. Can a country grow its economy by building nuclear reactors? What don't you understand about the employment consequences of imposing rate shock on industrial and commercial customers? Are the consequences of the Fukushima meltdowns really being overstated by antinuclear activists? Maybe, but see the chapter on the status of Fukushima. In short, the nuclear renaissance – whatever it may be called throughout the world - has always

consisted entirely of the number of reactors whose excess costs governments were prepared to make mandatory for either customers or taxpayers. Investor capital cannot be conscripted. Investors of the sort that nuclear power must attract study risks carefully. They know the information in this report, and so should everyone else with responsibility for energy decisions that allocate nuclear risk.

Nuclear renaissance is dead- lack of international support and natural gas boom gut the movementKloor, professor of environmental journalism @ NYU, ‘13

[Keith, 01/14/2013, Slate Magazine, “The Pro-Nukes Environmental Movement,” http://www.slate.com/articles/health_and_science/nuclear_power/2013/01/nuclear_energy_and_climate_change_environmentalists_debate_how_to_stop_global.html, 07/18/2014, PD]

And this was before the 2011 Fukushima Daiichi power plant meltdown in Japan. Since then, safety concerns have prompted some countries to abandon nuclear energy plans; Germany is phasing out nuclear power altogether. (Perversely, this has resulted in more greenhouse-gas-emitting coal being burned.) Not that long ago, the industry was poised for a big rebound, but the future suddenly looks grim. Perhaps that is what led the Economist last year to largely write off nuclear energy as a lost cause—or at least not a viable substitute for fossil fuels.

Another factor stalling the so-called “nuclear renaissance” is cheap natural gas, courtesy of the shale boom. As the New York Times reported last year, the sudden glut and the rapid switch from coal to gas by many utilities “calls into question talk of a nuclear revival in the United States.”

Nuclear renaissance is dead- poor projections and lack of economic viabilityGreen, coordinator of Beyond Nuclear Initiative, 12/25

[Jim, The Ecologist, 12/25/2013, “The nuclear renaissance is stone cold dead,” http://www.theecologist.org/News/news_analysis/2211231/the_nuclear_renaissance_is_stone_cold_dead.html, 07/18/2014, PD]

This year has been the nuclear power industry's annus horribilis and the nuclear renaissance can now be pronounced stone cold dead. Nuclear power suffered its biggest ever one-year fall in 2012 - nuclear generation fell 7% from the 2011 figure. Nuclear generation fell in no less than 17 countries, including all of the top five nuclear-generating countries. Nuclear power accounted for 17% of global electricity generation in 1993 and it has steadily declined to 10% now. The International Atomic Energy Agency (IAEA) has downwardly revised its nuclear power projections, and now anticipates growth of 23% to 100% percent by 2030. Historically, the IAEA's upper projections have been fanciful, and its lower projections are usually much closer to the mark. So annual growth of a little over 1% is about as much as the industry can realistically hope for. And the IAEA will further reduce its projections when it factors in this year's annus horribilis. In the US, even existing reactors are money sinks Perhaps the most shocking developments have been in the United States, where the industry is finding it increasingly difficult to profitably operate existing reactors - especially ageing reactors requiring

refurbishments - let alone build new ones. Almost half of the world's reactors have operated for 30 years or more, so the problem of ageing reactors will increasingly come into focus in coming years. Peter Bradford, a former member of the US Nuclear Regulatory Commission, notes that by 2009, applications for 31 new reactors in the US were pending. "The 31 proposed reactors are down to four actually being built and a few others lingering on in search of a licence, which is good for 20 years", Bradford writes. "Those four are hopelessly uneconomic but proceed because their state legislatures have committed to finish them as long as a dollar remains to be taken from any electric customer's pocket. Operating reactors are being closed as uneconomic for the first time in 15 years."

Nuclear energy renaissance is a farce- was media hypeBradford, professor @ Vermont Law School specializing in nuclear public policy, ‘13

[Peter A, Green Political Foundation, July 11th 2013, “Introduction:World Nuclear Industry Status Report 2013” http://www.worldnuclearreport.org/IMG/pdf/20130716msc-worldnuclearreport2013-hr-v4.pdf, 07/18/2014, PD]

Nuclear power requires obedience, not transparency. The gap between nuclear rhetoric and nuclear reality has been a fundamental impediment to wise energy policy decisions for half a century now. For various reasons in many nations, the nuclear industry cannot tell the truth about its progress, its promise or its perils. Its backers in government and in academia do no better. Rhetorical excess from opponents of nuclear power contributes to the fog, but proponents have by far the heavier artillery. During the rise and fall of the bubble formerly known as “the nuclear renaissance” in the U.S. many of their tools have been on full display. Academic and governmental studies a decade ago understated the likely cost of new reactors and overstated their potential contribution to fighting climate change. By 2006 a few U.S. state legislatures had been enticed to expose utility customers to all the risks of building new reactors. Industry-sponsored conferences persuaded businesses and newspapers of an imminent jobs bonanza, ignoring job losses resulting from high electric rates and passing up cheaper, more labor intensive alternatives. These local groups added to the pressure on Congress for more subsidies. France and Japan were held out as examples of countries that had avoided the timidity and overregulation that had stalled nuclear construction in the U.S. Indeed, it was argued, these nations had even solved the waste problem through their commitment to reprocessing spent fuel. At times inconsistent tales were told simultaneously. Thus the U.S. Congress was told that the new licensing process and the new generic designs were so untried and environmental opposition so formidable that loan guarantees were needed to lay the risks off on taxpayers. At the same time Wall Street and state legislatures were assured that these new features had chloroformed public opposition and otherwise laid to rest the terrifying industry ghosts embodied by the nine figure dollar losses at Shoreham, Seabrook, WPPSS, and Midland, sites that resonate in U.S. nuclear folklore like Civil War battlefield names. The renaissance story line was hard to resist. By early 2009, applications for 31 new reactors were pending at the U.S. Nuclear Regulatory Commission. The promises came garnished with tales of remorseful changes of heart from oft-obscure nuclear converts. With few exceptions, the news media - especially television with its thirst for the short and the simple - fell for the renaissance story line.

Not Solve WarmingEven if the Nuclear Renaissance was coming now, it would never be cost competitive and wouldn’t solve warmingHackenos, contributor to Aljazeera America specializing in energy policy and the European Union, 6/16

[Paul, 6/16/14, Aljazeera America, “The West Doesn’t Need Nuclear for Energy Independence”, http://america.aljazeera.com/opinions/2014/6/nuclear-energy-independenceeurope.html

Some of the most confounding problems of our day — global warming and the West’s energy dependence on Russia and the Middle East — appear to President Barack Obama and some of Europe’s leaders to have an obvious answer: more nuclear power. A May 2014 EU Commission study on Europe’s energy security after the Ukraine crisis insists it’s going to be a big part of the solution. Nuclear is also a central component of Obama’s “all of the above” energy strategy. After all, nuclear power plants are supposedly inexpensive to run, emit no CO2 and could lessen dependence on oil and gas imports from volatile regions of the world. A no-brainer, right? Not by a long shot. Nuclear power is a nasty red herring that advocates will pay for dearly, should it figure into their response to the current challenges on the table. In the past, critics of nuclear power went to great lengths to point out nuclear energy’s inherent danger. Consider the meltdowns at Three Mile Island in 1979, Chernobyl in 1986 and Fukushima in 2011, they said, on top of the untold number of smaller mishaps that never make the headlines. And then there’s the unsolvable dilemma of radioactive nuclear waste, which nobody wants anywhere near their backyards. In Europe these two strands of argument were enough to convince Danes, Italians, Austrians, the Irish and the Portuguese, among others, never to gamble with nuclear. Germany, Switzerland and Spain caught on later and are in the process of exiting nuclear power now. But these days the safety arguments pack less punch. Not because they’re any less valid but because the costs and financial risks of building new plants are so clearly prohibitive that nuclear power doesn’t make sense even if the safety risks were zero. In a nutshell: New nuclear power doesn’t pay. In fact, it’s dramatically more expensive than the newest generations of renewables (in particular, wind and solar). It’s the huge initial investment, the inevitable construction delays and cost overruns and poor long-term market prospects that make nuclear power such a bad deal today — and why private-sector utility companies are so hesitant to invest in new nuclear. In order to finance new reactors, countries such as the United Kingdom and Finland have called for enormous government subsidies; while this is not new (nuclear power has long been subsidized), the amounts in question today far exceed those of decades past. There are no better examples to underscore nuclear’s dismal prospects than in Europe. Take the U.K., where the government had to backtrack on its pledge never to subsidize nuclear power. The estimated construction cost of the two planned reactors at the Hinkley Point C plant in Somerset is a mind-boggling $27 billion, which will make it the most expensive power station ever built. Once in operation, the reactors should provide about 7 percent of Britain’s electricity — which sounds enticing. But in order to make this gigantic investment attractive, the British government had to guarantee the investors, the French state-owned EDF Energy Group and two Chinese state firms, a minimum per-kilowatt price for its electricity production for 35 years. The price finally settled on was almost twice the current wholesale market price for electricity. The outcry in the UK was

deafening. Paul Dorfman of the Energy Institute at University College London underlined who would be paying these subsidies. The fixed feed-in tariff, he said “is essentially a subsidy of between what we calculate to be £800m to £1bn [$1.3 billion to 1.7 billion] a year that the U.K. taxpayer and energy consumer will be putting into the deep pockets of Chinese and French corporations, which are essentially their governments.” Nuclear power, once the cutting edge of technological progress, is now a dinosaur, all the more anachronistic when one looks at the price of renewables. Even conservative financial analysts, such as those at the London stockbrokerage Liberum Capital, say the deal is foolhardy. In the aftermath of the transaction last year, it told The Guardian, “We are flabbergasted that the U.K. government has committed future generations of consumers to the costs that will flow from this deal … The U.K. government is taking a massive bet that fossil fuel prices will be extremely high in the future. If that bet proves to be wrong, then this contract will look economically insane.” Another white elephant is in Finland, where the latest-generation European pressurized water reactor (EPR) was supposed to be the poster boy for nuclear energy’s comeback on the continent. Begun in 2005, the Olkiluoto 3 plant was the first new reactor to begin construction in Europe since 2000. Today it is four years behind schedule and still has no estimated start date. Its projected cost has tripled, to over $11 billion. No one regrets the Olkiluoto 3 fiasco more than its French investor, Areva, whose 2013 losses on the plant were $553 million. At least this was less than in 2012, when the company’s losses and insurance indemnity due to delays and cost overruns tallied $910 billion. Another EPR is under construction in France, along the coast of Normandy, where it’s not faring any better, beset by multiyear delays, billion-dollar cost overruns, financial mismanagement and worker deaths. No wonder President François Hollande is rethinking France’s nuclear power program. Nuclear power, once the cutting edge of technological progress, is now a dinosaur, all the more anachronistic when one looks at the price of renewables, whose costs have plummeted over a decade and will, say experts, continue to decline as technology improves. The wunderkinder are solar photovoltaic, wind power and bioenergy. Solar and onshore wind prices are now at or quickly approaching market parity in many large electricity markets around the world. In other words, the cheapest renewables are now cost competitive with fossil fuels and nuclear, even without subsidies. This has been the case for some time now in regions with high electricity costs and abundant wind or sunshine.

Renewables can solve warming- nuclear energy is too contentiousWasserman, professor of history @ the Open U. and environmental activist, 04/17

[Harvey, 04/17/2014, EcoWatch, “IPCC: Renewables, Not Nuclear Power, Can Solve Climate Crisis”, http://ecowatch.com/2014/04/17/ipcc-renewables-not-nuclear-solve-climate/, 07/18/2014, PD]

The authoritative Intergovernmental Panel on Climate Change (IPCC) has left zero doubt that we humans are wrecking our climate. It also effectively says the problem can be solved, and that renewable energy is the way to do it, and that nuclear power is not. The United Nations’ IPCC is the world’s most respected authority on climate. This IPCC report was four years in the making. It embraces several hundred climate scientists and more than a thousand computerized

scenarios of what might be happening to global weather patterns. The panel’s work has definitively discredited the corporate contention that human-made carbon emissions are not affecting climate change. To avoid total catastrophe, says the IPCC, we must reduce the industrial spew of global warming gasses by 40-70 percent of 2010 levels. Though the warning is dire, the report offers three pieces of good news. First, we have about 15 years to slash these emissions. Second, renewable technologies are available to do the job. And third, the cost is manageable. Though 2030 might seem a tight deadline for a definitive transition to Solartopia, green power technologies have become far simpler and quicker to install than their competitors, especially atomic reactors. They are also far cheaper, and we have the capital to do it. The fossil fuel industry has long scorned the idea that its emissions are disrupting our Earth’s weather. The oil companies and atomic reactor backers have dismissed the ability of renewables to provide humankind’s energy needs. But the IPCC confirms that green technologies, including efficiency and conservation, can in fact handle the job—at a manageable price. “It doesn’t cost the world to save the planet,” says Professor Ottmar Edenhofer, an economist who led the IPCC team. The IPCC report cites nuclear power as a possible means of lowering industrial carbon emissions. But it also underscores considerable barriers involving finance and public opposition. Joined with widespread concerns about ecological impacts, length of implementation, production uncertainties and unsolved waste issues, the report’s positive emphasis on renewables virtually guarantees nuclear’s irrelevance. Some climate scientists have recently advocated atomic energy as a solution to global warming. But their most prominent spokesman, Dr. James Hansen, also expresses serious doubts about the current generation of reactors, including Fukushima, which he calls “that old technology.” Instead Hansen advocates a new generation of reactors. But the designs are untested, with implementation schedules stretching out for decades. Financing is a major obstacle as is waste disposal and widespread public opposition, now certain to escalate with the IPCC’s confirmation that renewables can provide the power so much cheaper and faster. With its 15-year deadline for massive carbon reductions, the IPCC has effectively timed out any chance a new generation of reactors could help. And with its clear endorsement of green power as a tangible, doable, affordable solution for the climate crisis, the pro-nuke case has clearly suffered a multiple meltdown.

Nuclear power solves proliferation and warming- only way to solve baseload power

Biello, editor of Energy and Environment @ Scientific American, 12/23

[David, 12/23/2014, Scientific American, “How Nuclear Power Can Stop Global Warming,” http://www.scientificamerican.com/article/how-nuclear-power-can-stop-global-warming/, 07/18/2014, PD]

When the Atlantic Navigator docked in Baltimore harbor earlier this month, the freighter carried the last remnants of some of the nuclear weapons that the Soviet Union had brandished in the cold war. During the past 20 years more than 19,000 Russian warheads have been dismantled and processed to make fuel for U.S. nuclear reactors. In fact, during that period more than half the uranium fuel that powered the more than 100 reactors in the U.S. came from such reprocessed nuclear weapons. In addition to reducing the risk of nuclear war, U.S. reactors have also been staving off another global challenge: climate change. The low-carbon electricity

produced by such reactors provides 20 percent of the nation's power and, by the estimates of climate scientist James Hansen of Columbia University, avoided 64 billion metric tons of greenhouse gas pollution. They also avoided spewing soot and other air pollution like coal-fired power plants do and thus have saved some 1.8 million lives. And that's why Hansen, among others, such as former Secretary of Energy Steven Chu, thinks that nuclear power is a key energy technology to fend off catastrophic climate change. "We can't burn all these fossil fuels," Hansen told a group of reporters on December 3, noting that as long as fossil fuels are the cheapest energy source they will continue to be burned. "Coal is almost half the [global] emissions. If you replace these power plants with modern, safe nuclear reactors you could do a lot of [pollution reduction] quickly." Indeed, he has evidence: the speediest drop in greenhouse gas pollution on record occurred in France in the 1970s and ‘80s, when that country transitioned from burning fossil fuels to nuclear fission for electricity, lowering its greenhouse emissions by roughly 2 percent per year. The world needs to drop its global warming pollution by 6 percent annually to avoid "dangerous" climate change in the estimation of Hansen and his co-authors in a recent paper in PLoS One. "On a global scale, it's hard to see how we could conceivably accomplish this without nuclear," added economist and co-author Jeffrey Sachs, director of the Earth Institute at Columbia University, where Hansen works. The only problem: the world is not building so many nuclear reactors.

Nuclear Energy is lowering carbon emissions and limiting the effects of warmingBiello, contributor to the Scientific American focusing on Energy and Security, 13

[Dave, 12/12/13, Scientific American, “How Nuclear Power can Stop Global Warming”, http://www.scientificamerican.com/article/how-nuclear-power-can-stop-global-warming/, 7/18/14, JA]

When the Atlantic Navigator docked in Baltimore harbor earlier this month, the freighter carried the last remnants of some of the nuclear weapons that the Soviet Union had brandished in the cold war. During the past 20 years more than 19,000 Russian warheads have been dismantled and processed to make fuel for U.S. nuclear reactors. In fact, during that period more than half the uranium fuel that powered the more than 100 reactors in the U.S. came from such reprocessed nuclear weapons. In addition to reducing the risk of nuclear war, U.S. reactors have also been staving off another global challenge: climate change. The low-carbon electricity produced by such reactors provides 20 percent of the nation's power and, by the estimates of climate scientist James Hansen of Columbia University, avoided 64 billion metric tons of greenhouse gas pollution. They also avoided spewing soot and other air pollution like coal-fired power plants do and thus have saved some 1.8 million lives. And that's why Hansen, among others, such as former Secretary of Energy Steven Chu, thinks that nuclear power is a key energy technology to fend off catastrophic climate change. "We can't burn all these fossil fuels," Hansen told a group of reporters on December 3, noting that as long as fossil fuels are the cheapest energy source they will continue to be burned. "Coal is almost half the [global] emissions. If you replace these power plants with modern, safe nuclear reactors you could do a lot of [pollution reduction] quickly." Indeed, he has evidence: the speediest drop in greenhouse gas pollution on record occurred in France in the 1970s and ‘80s, when that country transitioned from burning fossil fuels to nuclear fission for electricity, lowering its greenhouse emissions by roughly 2 percent per year. The world needs to drop its global warming pollution by 6 percent annually to avoid "dangerous" climate change in the estimation of Hansen and his co-authors in a recent paper in PLoS One. "On a global scale, it's hard to see how we could conceivably accomplish this without nuclear," added economist and co-author Jeffrey Sachs, director of the Earth Institute at Columbia University, where Hansen works.

No LinkThe link is empirically disproven- renewable energy and energy can co-exist- no trade offsMonbiot, published author and contributor to The Guardian, 2011

[George, 5/27/11, The Guardian, “Why must UK have to choose between nuclear and renewable energy?”, http://www.theguardian.com/environment/georgemonbiot/2011/may/27/why-choose-nuclear-renewable-energy, 7/18/14, JA]

I know that others don't share my puzzlement, but I don't understand why the nuclear question needs to divide the environment movement. Our underlying aim is the same: we all want to reduce human impacts on the biosphere. We all agree that our consumption of resources must be reduced, as sharply as possible. We all question the model of endless economic growth. ¶

Almost everyone in this movement also recognises that – even with the maximum possible conservation of resources and efficiency in the way they are used – we will not be able to bring our consumption down to zero. This is especially the case with electricity. Those who have been following the issue closely know that even with massive reductions in energy demand, electricity use will have to rise in order to remove fossil fuels from both transport and heating.¶ The idea, on which there's also wide agreement within the movement, is that the petrol and diesel used to power cars, buses and trains, and the gas and oil used to heat our houses, should be partly or mostly replaced by low-carbon electricity. That means an increase in electricity supply, even as, with sweeping efficiency measures in all sectors, our total energy consumption falls.¶ So the only question that divides us is how this low-carbon electricity should be produced. I don't much care about which technology is used, as long as the other impacts are as small as possible, and greenhouse gas emissions are reduced quickly and efficiently. None of our options is easy and painless. ¶ Windfarms are running into massive public opposition, not least because of the new power lines required to connect them to the grid. The costs of other kinds of renewables are high, and their potential to supply much of our electricity is low.¶ The capture and storage of the carbon dioxide produced by burning fossil fuels has yet to be demonstrated at the scale required to show that it's a viable option. It is also expensive, and still involves mining coal and drilling for gas. That means continued environmental impacts, which are likely to escalate as shale gas is extracted and coal is increasingly mined through open casting.¶ Nuclear power remains an object of deep public suspicion. The advantage it has over renewables is that production takes place on a compact site, rather than being spread over the countryside, and that new power lines are not required in places where they haven't been built before. The disadvantage it shares with coal and gas is that it depends upon the extraction of uranium, which, like mining fossil fuels, imposes a high environmental cost. In principle this could be overcome by moving to fourth-generation nuclear technologies. Not only do they not require fresh supplies of uranium, but some of the proposed technologies consume existing nuclear waste. None of them has yet been demonstrated at scale, however.¶ The large-scale deployment of any of these three options – renewables, carbon capture and storage or nuclear – will take between 10 and 20 years.¶ These are hard physical and political constraints. There is no point in tearing each other apart over issues we can do little about. We can agree to disagree over what the mix should be, and we can keep debating all the issues it involves, hopefully in a friendly

manner. The likely scenario is that, because of the problems faced by all three technologies, we'll probably need some of each. But is this possible?¶ According to Jonathon Porritt, it isn't. In a recent blog post discussing renewables and nuclear power, he asserts that:¶ "It's becoming clearer and clearer that we're now into a strict fight in terms of those two options. The days when people talked about "co-existence" are long gone; this is now either/or, not both/and."¶

That statement would require an explanation at any time, and unfortunately Porritt doesn't provide one. But coming just after the Committee on Climate Change published its renewable energy review, it needs even more unpacking.¶ The committee is the body that recommends the government's carbon targets, and offers advice on how they might best be met. Of all the agencies involved in these questions, it has the most influence over government policy, as we saw during the bust-up within the cabinet this month over whether or not its target should be adopted (the committee won after David Cameron intervened). What the committee recommends is what is most likely to happen. It advises that:¶ "The optimal policy is to pursue a portfolio approach, with each of the different technologies playing a role."¶ It suggests the following, illustrative scenario for decarbonising electricity by 2030:¶ • 40% renewables ¶ • 40% nuclear ¶ • 15% carbon capture and storage¶ • Up to 10% gas without carbon capture and storage¶ It raised no difficulties about co-existence between nuclear and renewables. And why should there be? Why can't nuclear provide the baseload power, and renewables and carbon capture and storage most of the rest? Why can't it be both/and, rather than either/or?

Environment TurnNuclear energy compounds fossil fuel usage, releases CFCs, causes warming, and is biologically hazardousCaldicott, president of Nuclear Policy Research Institute, ‘06

(Helen, Melbourne University Press 2006, “Nuclear Power is not the Answer,” http://tria.fcampalans.cat/images/Nuclear%20Power%20is%20not%20the%20answer%20-%20H.%20Caldicott.pdf

The current administration clearly believes that if it lies frequently and with conviction, the general public will be lulled into believing their oft-repeated dictums. As this book will show, no part of “efficiently, safely, and with no discharge of greenhouse gases or emissions” is true. Nuclear energy creates significant greenhouse gases and pollution today, and is on a trajectory to produce as much as conventional sources of energy within the next one or two decades. It requires massive infusions of government (read taxpayer) subsidies, relying on universities and the weapons industry for its research and development, and being considered far too risky for private investors. It is also doubtful that the 8,358 individuals diagnosed between 1986 and 2001 with thyroid cancer in Belarus, downwind of Chernobyl, would choose the adjective “safe” to describe nuclear power. Nuclear power is not “clean and green,” as the industry claims, because large amounts of traditional fossil fuels are required to mine and refine the uranium needed to run nuclear power reactors, to construct the massive concrete reactor buildings, and to transport and store the toxic radioactive waste created by the nuclear process. Burning of this fossil fuel emits significant quantities of carbon dioxide (CO2)—the primary “greenhouse gas”—into the atmosphere. In addition, large amounts of the now-banned chlorofluorocarbon gas (CFC) are emitted during the enrichment of uranium. CFC gas is not only 10,000 to 20,000 times more efficient as an atmospheric heat trapper (“greenhouse gas”) than CO2, but it is a classic “pollutant” and a potent destroyer of the ozone layer. While currently the creation of nuclear electricity produces only one-third the amount of CO2 emitted from a similar-sized, conventional gas generator, this is a transitory statistic. Over several decades, as the concentration of available uranium ore declines, more fossil fuels will be required to extract the ore from less concentrated ore veins. Within ten to twenty years, nuclear reactors will produce no net energy because of the massive amounts of fossil fuel that will be necessary to mine and to enrich the remaining poor grades of uranium. (The nuclear power industry contends that large quantities of uranium can be obtained by reprocessing radioactive spent fuel. However, this process is extremely expensive, medically dangerous for nuclear workers, and releases large amounts of radioactive material into the air and water; it is therefore not a pragmatic consideration.) By extension, the operation of nuclear power plants will then produce exactly the same amounts of greenhouse gases and air pollution as standard power plants.

Prolif TurnNuclear renaissance’s increased uranium dependence causes proliferationPaine, senior policy advisor @ nuclear program @ NRDC, ‘10

[Christopher E., 03/01/2010, University of Richmond Law Review, “The Nuclear Fuel Cycle, Global Security, And Climate Change: Weighing The Costs And Benefits Of Nuclear Power Expansion,” http://lawreview.richmond.edu/wp/wp-content/uploads/2010/03/Christopher-Paine-Weighing-Costs-of-Nuclear-Fuel.pdf, 07/18/2014, PD]

For many developing countries, significant dependence on nuclear power would merely exchange one form of foreign fuel dependence for another. Most nuclear countries, including the United States, lack sufficient high-quality uranium resources to satisfy their nuclear fuel demand domestically.1" Uranium concentrate, and in most cases enriched and fabricated fuel, must be imported.™ However, as we have seen, the understandable desire to achieve energy independence, when pursued in the nuclear realm, can have destabilizing consequences. Whether or not the declared energy security motive is genuine, it can lead to a country's clandestine acquisition or indigenous development of its own autonomous sensitive nuclear fuel cycle facilities, and these can be used to produce the materials needed for nuclear weapons. J. Nuclear Facilities Can Be Magnets for Attack Nuclear reactors and their associated spent fuel pools and fuel cycle facilities can become targets in wartime, as we have seen repeatedly in the Middle East: Israel attacked Iraq's research reactor in 1981;*" Iraq attacked Iran's partially completed Bushehr reactors during the Iran-Iraq War in the 1980s;*10 Iraq fired Scud missiles at Israel's Dimona military production reactor during the first Gulf War;"1 and in September 2007 Israel launched a successful aerial attack on what it reportedly believed to be a North Korean supplied nuclear facility in eastern Syria.11* President Bush worried publicly in October 2007 about the possibility that the threat of an Iranian attack on nuclear-armed Israel could trigger "World War III," suggesting we might be wise to avert this possibility by "preventing [the Iranians] from having the knowledge necessary to make a nuclear weapon."313

Stopping the spread of nuclear weapons is key- proliferation and health issuesGoldschmidt, visiting scholar @ Carnegie Endowment for International Peace, ‘08

[Pierre, Carnegie Endowment, 2/19/2008-2/21/2008, “Nuclear Renaissance and Non-Proliferation,” http://www.ctbto.org/fileadmin/user_upload/pdf/External_Reports/nuclearsocieties_2-19-081.pdf, 07/18/2014, PD]

What is of concern is that some of the States that have recently indicated interest in acquiring NPPs seem to be motivated by geo-political considerations as much as by economic or environmental factors. It is also worrisome to see some supplier states racing to offer their services to countries where starting now an electro-nuclear program does not appear to be the best or a priority option. International organizations such as the IAEA can certainly help in laying out objective, well studied criteria to judge when and where nuclear energy makes sense or not. In the short term, in order to compensate for the lack of adequate industrial infrastructure and

nuclear safety culture in some recipient States, suppliers may offer BOT contracts, whereby they would build, operate and later transfer the NPP to the buyer. That might work initially in few cases, but is it sustainable in the longer term? Are we really going to see Russian, French, American or Chinese experts assuming the responsibility of operating NPPs in Libya, Jordan, the UAE and other States? We should always keep in mind that a severe nuclear accident anywhere in the world will have damaging consequences for the whole industry even in those countries where NPPs are operated in the safest way. THE NON-PROLIFERATION CHALLENGE Today I will not dwell further on these important safety aspects, but wish to focus on some of the non-proliferation challenges inevitably associated with a worldwide expansion of the peaceful use of nuclear energy. I believe that the IAEA is in a position to provide adequate assurances that there is no diversion of nuclear material from NPPs and no undeclared nuclear material and activities in any country that does not have sensitive nuclear fuel cycle facilities and has a Comprehensive Safeguards Agreement (CSA) and a Additional Protocol (AP) in force with the Agency2 . In contrast, the Agency’s ability to provide the necessary assurances in a country that operates sensitive nuclear fuel cycle facilities and has not ratified the AP is limited. It is even lower if such a country has been found to be in breach of its obligation to comply with its safeguards agreement, or is uncooperative in resolving any question or inconsistency, or refuses (or delays) access to locations (e.g. to take environmental swipes) requested by the Agency or rejects (or delays) the installation of surveillance and containment equipments including remote monitoring. In order to address these concerns and minimize the risks, we must both discourage the spread of sensitive fuel cycle facilities and strengthen the IAEA verification authority, in particular when a State has been found to be in non-compliance with its safeguards agreement.

***Hafnium DA

Hafnium DA – Nuclear Expansion

1NCHafnium demand is low now – prices are downVulcan, researcher and contributor to HardAssetsInvestor.com, 11 (Tom, 2-28, “Hafnium: Small Supply, Big Applications”, http://www.hardassetsinvestor.com/features/2572-hafnium-small-supply-big-applications.html?showall=&fullart=1&start=5, 7-16-14, Tang)

The price of hafnium is interesting on two counts. First, historically, the price of the metal has remained very steady over quite long periods—from 1970 to 2000 there was extraordinarily little volatility in it price. Second, it appears to be so cheap!

Currently, hafnium with 0.2-0.5 percent zirconium content sells for around $1,200-1,300 per kilogram. On occasion, hafnium with an even lower zirconium content (<0.1 percent) is produced and sold at an even higher premium. The metal with 0.5-1.0 percent zirconium content sells for $800-900 per kilo, while that with 1-3 percent zirconium content sells for $500-700 per kilo.

However, with only around 70 tonnes of the metal being produced each year, compared to, say, only about 50 tonnes of rhenium produced each year, one wonders: Why does hafnium fetch so much less than rhenium, which currently sells for $4,000-5,000 per kilo?

Nuclear expansion raises hafnium prices and creates supply bottlenecks – independently takes out solvencyAbbott, professor in the School of Electrical and Electronic Engineering at the University of Adelaide, Australia, 13 (Derek, Physicist and Electronic Engineer with a focus on energy-technology and global energy demand, 5-30, “Limits to growth: Can nuclear power supply the world’s needs?” http://thebulletin.org/2012/september/limits-growth-can-nuclear-power-supply-world%E2%80%99s-needs)

Could nuclear power be rapidly expanded on a global scale? There are a number of practical limiting factors, including site availability and acceptability, nuclear waste disposal issues, and the risks of accidents and proliferation. But there are also a variety of resource limitations. One particular resource limitation that has not been clearly articulated in the nuclear debate thus far is the availability of the relatively scarce metals used in the construction of the reactor vessel and core. While this scarcity is not of immediate concern, it would present a hard limit to the ultimate expansion of nuclear power. This limit appears to be a harder one than the supply of uranium fuel. An increased demand for rare metals—such as hafnium, beryllium, zirconium, and niobium, for example—would also increase their price volatility and limit their rate of uptake in nuclear power stations. Metals used in the nuclear vessel eventually become radioactive and, on decommissioning, those with long half-lives cannot be recycled on timescales useful to human civilization. Thus, a large-scale expansion of nuclear power would reduce “elemental diversity” by depleting the world’s supply of some elements and making them unavailable to future generations.

Increased expenses will incentivize companies to cut corners and compromise safety – that risks meltdownsLuleva, researcher for the green optimist, 13 (Mila, 9-30, “Small Commercial Nuclear Reactors Compromise On Safety, Report States”, http://www.greenoptimistic.com/2013/09/30/small-nuclear-reactors-safety/#.U8moBvldXKE, 7-16-14, Tang)

A new report by the Union of Concerned Scientists (UCS), entitled “Small Isn’t Always Beautiful”, points out that these small reactors will not be able to produce cheaper electricity, while maintaining the necessary safety. Small nuclear reactors became quite popular in 2011-2012, as Fukushima disaster occurred, and at the same time gas prices dropped. This caused many people to lose trust in nuclear power, and vendors began to explore different options.

Edwin Lyman, the author of the report, concluded that a small reactor might be cheaper to build, however the final product would be much more prone to serious accidents and a subject to terrorist attacks. And yet, some utilities, in their search for a cheaper alternative or a fast solution to an energy deficiency problem, are inclined to invest in smaller projects.This report is not the first to point out the hidden dangers that small reactors pose. The Institute for Energy and Environmental Research (IEER) produced another document last month, stating that these small reactors will require huge subsidies and numerous orders, so that the manufacturers can make profit. Many vendors compromise on reactors’ safety. At the same time, they are demanding lowering of the requirements set by the Nuclear Regulatory Commission on emergency planning, control room staffing and security force staffing. According to Lyman, such negotiations are done behind close doors, with the excuse that proprietary information has to be protected. The author also finds the reasoning of vendors that small reactors will cut costs, unjustified. Reduced costs ultimately means more defects in the modular construction, he states. It might be possible for the manufacturers to really produce a small reactor that costs less and meet all safety requirements, however the industry is not there yet. It will require a lot more time, a lot more taxpayers money and much larger involvement of the DOE and the Congress. Lyman states that the disaster in Fukushima should not be used as a reason for the industry to promote smaller reactors as safer because they require lower emergency planning zones. On the contrary, instead of NRC weakening safeguards to accommodate the new reactors, they should instead put safety issues first.

Meltdowns cause extinctionLendman, Research Associate of the Centre for Research on Globalization, 11 (Stephen, 3-13, “Nuclear Meltdown in Japan,” http://www.thepeoplesvoice.org/TPV3/Voices.php/2011/03/13/nuclear-meltdown-in-japan, 7-16-14, Tang)

Reuters said the 1995 Kobe quake caused $100 billion in damage, up to then the most costly ever natural disaster. This time, from quake and tsunami damage alone, that figure will be dwarfed. Moreover, under a worst case core meltdown, all bets are off as the entire region and beyond will be threatened with permanent contamination, making the most affected areas

unsafe to live in. On March 12, Stratfor Global Intelligence issued a "Red Alert: Nuclear Meltdown at Quake-Damaged Japanese Plant," saying: Fukushima Daiichi "nuclear power plant in Okuma, Japan, appears to have caused a reactor meltdown." Stratfor downplayed its seriousness, adding that such an event "does not necessarily mean a nuclear disaster," that already may have happened - the ultimate nightmare short of nuclear winter. According to Stratfor, "(A)s long as the reactor core, which is specifically designed to contain high levels of heat, pressure and radiation, remains intact, the melted fuel can be dealt with. If the (core's) breached but the containment facility built around (it) remains intact, the melted fuel can be....entombed within specialized concrete" as at Chernobyl in 1986. In fact, that disaster killed nearly one million people worldwide from nuclear radiation exposure. In their book titled, "Chernobyl: Consequences of the Catastrophe for People and the Environment," Alexey Yablokov, Vassily Nesterenko and Alexey Nesterenko said: "For the past 23 years, it has been clear that there is a danger greater than nuclear weapons concealed within nuclear power. Emissions from this one reactor exceeded a hundred-fold the radioactive contamination of the bombs dropped on Hiroshima and Nagasaki." "No citizen of any country can be assured that he or she can be protected from radioactive contamination. One nuclear reactor can pollute half the globe. Chernobyl fallout covers the entire Northern Hemisphere." Stratfor explained that if Fukushima's floor cracked, "it is highly likely that the melting fuel will burn through (its) containment system and enter the ground. This has never happened before," at least not reported. If now occurring, "containment goes from being merely dangerous, time consuming and expensive to nearly impossible," making the quake, aftershocks, and tsunamis seem mild by comparison. Potentially, millions of lives will be jeopardized. Japanese officials said Fukushima's reactor container wasn't breached. Stratfor and others said it was, making the potential calamity far worse than reported. Japan's Nuclear and Industrial Safety Agency (NISA) said the explosion at Fukushima's Saiichi No. 1 facility could only have been caused by a core meltdown. In fact, 3 or more reactors are affected or at risk. Events are fluid and developing, but remain very serious. The possibility of an extreme catastrophe can't be discounted. Moreover, independent nuclear safety analyst John Large told Al Jazeera that by venting radioactive steam from the inner reactor to the outer dome, a reaction may have occurred, causing the explosion. "When I look at the size of the explosion," he said, "it is my opinion that there could be a very large leak (because) fuel continues to generate heat." Already, Fukushima way exceeds Three Mile Island that experienced a partial core meltdown in Unit 2. Finally it was brought under control, but coverup and denial concealed full details until much later. According to anti-nuclear activist Harvey Wasserman, Japan's quake fallout may cause nuclear disaster, saying: "This is a very serious situation. If the cooling system fails (apparently it has at two or more plants), the super-heated radioactive fuel rods will melt, and (if so) you could conceivably have an explosion," that, in fact, occurred. As a result, massive radiation releases may follow , impacting the entire region. "It could be, literally, an apocalyptic event.

UQ – demand lowHafnium market is low now – production capabilities are limited Vulcan, researcher and contributor to HardAssetsInvestor.com, 11 (Tom, 2-28, “Hafnium: Small Supply, Big Applications”, http://www.hardassetsinvestor.com/features/2572-hafnium-small-supply-big-applications.html?showall=&fullart=1&start=5, 7-16-14, Tang)

The market for hafnium, a metal crucial to both the aerospace and nuclear energy industries, may remain a relatively tiny one for now. But look for it to grow much bigger in the global infrastructure build-out to come.

With an average crustal abundance of 3 ppm (parts per million), hafnium—a shiny, silver-gray metal often used in alloys and nuclear science—certainly isn't rare. The metal is more abundant in the Earth's crust than gold, silver, the PGMs, a number of the rare earths and the likes of germanium, tantalum and molybdenum. But as a metal, hafnium is only produced in quite small quantities, currently probably not much more than 70 tonnes a year.

There are two main reasons for this. First, hafnium is only ever produced as a byproduct of refining zirconium for use in nuclear-related applications, especially in nuclear power plants. Second, it is extremely difficult to separate the metal from zirconium, the element with which it is most often found.

Indeed, because of this, only two significant producers of the metal exist worldwide at present: ATI Wah Chang (part of Allegheny Technologies Inc. (NYSE: ATI) in Oregon in the U.S.; and CEZUS in Jarrie, France (part of France's AREVA group (PA: CEI) and the world's largest builder of nuclear power stations).

IL - Hafnium k2 nuclearHafnium control rods are key to nuclear safetyMatson, writer for Scientific American, 11 (John, 5-15, Scientific American, “What Happens During a Nuclear Meltdown?”, http://www.scientificamerican.com/article/nuclear-energy-primer/, 7-16-14, Tang)

Sustained nuclear fission reactions rely on the passing of neutrons from one atom to another—the neutrons released in one atom's fissioning trigger the fissioning of the next atom. The way to cut off a fission chain reaction, then, is to intercept the neutrons. Nuclear reactors utilize control rods made from elements such as cadmium, boron or hafnium, all of which are efficient neutron absorbers. When the reactor malfunctions or when operators need to shut off the reactor for any other reason technicians can remotely plunge control rods into the reactor core to soak up neutrons and shut down the nuclear reaction.

Hafnium used to control nuclear reactorsMEC, Minerals Education Coalition, 13 (“Hafnium,” http://www.mineralseducationcoalition.org/minerals/hafnium, 7-15-14, Tang)

The most significant use of hafnium is in the production of special alloys known as superalloys. Superalloys are alloys (mixtures) of metals that are designed to withstand high-stress situations, such as very high temperatures and pressures. Such metals can include iron, nickel, chromium, titanium, niobium, hafnium and other metals. Because of its ability to absorb neutrons, it is used to control nuclear reactions in fission reactors, including the nuclear reactors that power nuclear submarines. Hafnium is also used as a “scavenger” metal in the retrieval of oxygen and nitrogen. A scavenger metal is one which aids in the collection of gases without reacting with them to form other compounds.

Hafnium is key to control rodsShikov et al., leading scientist in the field of applied superconductivity. 3 (Alexander, O. V. Bocharov, V. M. Arzhakova, V. N. Bexumov, Yu. A. Perlovich, M.G. Isaenkove, “Use of Hafnium in Control Elements of Nuclear Reactors and Power Units”, http://link.springer.com/article/10.1023%2FA%3A1027392604745 , 7-16-14, Tang)

Metallic hafnium possesses a combination of properties that makes it the preferred material for control elements of nuclear reactors. The distinctive properties of hafnium include: (I) a high absorptive capacity that changes inconsiderably in the operation because the isotopes of hafnium found under irradiation also have a high neutron-capture cross section; (2) a high corrosion resistance that makes it possible to use hafnium in contact with the water coolant without pro- tective cladding: (3) high mechanical properties that satisfy the require- ments on control rods: (4) high heat and radiation resistance: (5) high adaptability to manufacture. which makes it pos- sible to produce hafnium parts of virtually any shape by pres- sure treatment: (6) availability. because hafnium is a byproduct of commercial production of nuclear-purity

zirconium. American and British nuclear submarines are equipped with control elements employing hafnium. About half of the hafnium consumed in the USA goes for this purpose (I. 2].

The nuclear industry relies on hafnium – supply shortages prevents long term solvencyVulcan, researcher and contributor to HardAssetsInvestor.com, 11 (Tom, 2-28, “Hafnium: Small Supply, Big Applications”, http://www.hardassetsinvestor.com/features/2572-hafnium-small-supply-big-applications.html?showall=&fullart=1&start=5, 7-16-14, Tang)

We have hafnium metal only as a result of the decision to use zirconium in nuclear applications. As mentioned previously, purified zirconium must contain as little hafnium as possible to be of any use in uranium-based fuel rods, so the hafnium must be entirely removed. Thus, it's perhaps appropriate that, apart from its use in alloys, one of hafnium's other major applications is in nuclear contexts.

While the chemistry of hafnium and zirconium may be quite similar, their properties in a nuclear environment could not be more dissimilar. Zirconium is virtually transparent to neutrons, while hafnium is extremely absorbent. Thus, while the fuel rods themselves are often made out of zirconium, control rods (which mop up the neutrons flying around and, therefore, slow nuclear fission in the reactor) are often made of hafnium. One of their first uses in this context was in the pressurized light water reactors used to power such naval vessels as submarines.

It is, though, interesting to note that the effects of contamination of one metal by the other appear not to be symmetric; hafnium control rods can still function effectively if they contain up to 4.5 percent zirconium, but certainly not vice versa for fuel rods. In addition to its neutron absorbency, hafnium also boasts two further valuable properties in the nuclear context: strength and resistance to corrosion.

IL – SafetyIncreased costs trade off with nuclear safetyEdwards, journalist specialising in environmental issues 11 (Rob, Aug 25, The Gaurdian, “Nuclear safety getting worse in military facilities, says MoD study”, http://www.theguardian.com/world/2011/aug/25/nuclear-safety-military-mod-study, 7-16-14, Tang)

The risk of accidents and radioactive leaks from Britain's ageing nuclear bombs and submarines is getting "progressively worse" because of deepening spending cutbacks, according to an internal Ministry of Defence report. The report, which has been released under the Freedom of Information Act, reveals that the MoD is facing an increasing struggle to maintain the safety of the nation's military nuclear activities as cuts become "yet more painful". There was a "lack of adequate resource to deliver the defence nuclear programmes safely," it says. Written by the MoD's senior nuclear safety watchdog, the report warns that the number of incidents at nuclear sites is "too high". This poses a "risk to the workforce and public safety and to the environment, in both short and medium term". It also says that measures meant to overcome prolonged shortages of safety engineers "may be insufficient", and criticises the MoD for failing to allocate funding for the decommissioning and disposal of 17 defunct nuclear submarines now laid up at Devonport in Plymouth and Rosyth in Fife. The report covers 2010 and was written by Howard Mathers, the chairman of the MoD's defence nuclear environment and safety board. It offers an assurance that levels of nuclear safety are currently "acceptable". But he adds: "My confidence in making this judgement is reduced from 2009 due to the adverse trend in resources (which I expect will become yet more painful), further aggravated by constraints on regulatory capacity." The defence nuclear programmes are unlikely to be exempt from the pressures caused by the MoD's plan to shed 17,000 military and 25,000 civilian jobs, the report says. The aspiration for a 25% cut in operating costs "is obviously pulling in an opposite direction to the current shortfall in resource". The study urges nuclear managers "to establish the most robust baselines possible and defend them rigorously." He cautions that the government's decision to extend the life of the existing Trident weapons system to save money "will present safety justification challenges". The release of the 2010 nuclear safety report follows the release of reports for previous years in January. "This again shows that the ever continuing reduction in resources is putting the safety of MoD staff and the public at increasing and indeed unacceptable risk," said Fred Dawson, a former senior MoD safety official. "The MOD has failed to allocate sufficient resources to nuclear safety," he told the Guardian. "The report acknowledges this situation is becoming worse and not better." Dawson worked for the MoD for 31 years and was head of the radiation protection policy team before retiring in 2009. The repeated warnings by Mathers and his predecessors were clearly failing to persuade ministers to devote enough money to nuclear safety, he argued. John Ainslie, the co-ordinator of the Scottish Campaign for Nuclear Disarmament, accused the government of "cutting corners" on nuclear safety. "The defence minister, Liam Fox, is determined to replace Trident, but he doesn't want to spend money on protecting the public from a nuclear accident." The MoD stressed that it maintained the highest standards of nuclear safety and had an excellent record over the last 50 years. "This is recognised in the report, which describes a wide range of actions we have already taken to ensure we have sufficient numbers of qualified and experienced personnel," said an MoD spokeswoman. "As is routine for all MoD

programmes, the submarine dismantling project is funded in stages and is fully funded for the current assessment phase."

Safety compromises lead to meltdownsAP, Associated Press, 11 (June 20 ,“U.S. nuke regulators weaken safety rules”, http://www.cbsnews.com/news/us-nuke-regulators-weaken-safety-rules/, 7-16-14, Tang)

LACEY TOWNSHIP, N.J. — Federal regulators have been working closely with the nuclear power industry to keep the nation's aging reactors operating within safety standards by repeatedly weakening those standards, or simply failing to enforce them, an investigation by The Associated Press has found. Time after time, officials at the U.S. Nuclear Regulatory Commission have decided that original regulations were too strict, arguing that safety margins could be eased without peril, according to records and interviews. The result? Rising fears that these accommodations by the NRC are significantly undermining safety — and inching the reactors closer to an accident that could harm the public and jeopardize the future of nuclear power in the United States. Examples abound. When valves leaked, more leakage was allowed — up to 20 times the original limit. When rampant cracking caused radioactive leaks from steam generator tubing, an easier test of the tubes was devised, so plants could meet standards. Failed cables. Busted seals. Broken nozzles, clogged screens, cracked concrete, dented containers, corroded metals and rusty underground pipes — all of these and thousands of other problems linked to aging were uncovered in the AP's yearlong investigation. And all of them could escalate dangers in the event of an accident. Yet despite the many problems linked to aging, not a single official body in government or industry has studied the overall frequency and potential impact on safety of such breakdowns in recent years, even as the NRC has extended the licenses of dozens of reactors. Industry and government officials defend their actions, and insist that no chances are being taken. But the AP investigation found that with billions of dollars and 19 percent of America's electricity supply at stake, a cozy relationship prevails between the industry and its regulator, the NRC. Records show a recurring pattern: Reactor parts or systems fall out of compliance with the rules. Studies are conducted by the industry and government, and all agree that existing standards are "unnecessarily conservative." Regulations are loosened, and the reactors are back in compliance. "That's what they say for everything, whether that's the case or not," said Demetrios Basdekas, an engineer retired from the NRC. "Every time you turn around, they say 'We have all this built-in conservatism.'" The ongoing crisis at the stricken, decades-old Fukushima Dai-ichi nuclear facility in Japan has focused attention on the safety of plants elsewhere in the world; it prompted the NRC to look at U.S. reactors, and a report is due in July. But the factor of aging goes far beyond the issues posed by the disaster at Fukushima. Commercial nuclear reactors in the United States were designed and licensed for 40 years. When the first ones were being built in the 1960s and 1970s, it was expected that they would be replaced with improved models long before those licenses expired. But that never happened. The 1979 accident at Three Mile Island, massive cost overruns, crushing debt and high interest rates ended new construction proposals for several decades. Instead, 66 of the 104 operating units have been relicensed for 20 more years, mostly with scant public attention. Renewal applications are under review for 16 other reactors. By the standards in place when they were

built, these reactors are old and getting older. As of today, 82 reactors are more than 25 years old. The AP found proof that aging reactors have been allowed to run less safely to prolong operations. As equipment has approached or violated safety limits, regulators and reactor operators have loosened or bent the rules. Above: This April 2006 photo made available by the Nuclear Regulatory Commission in response to a public records request by The Associated Press shows a badly rusted valve in a containment spraying system that was initially a focus of concern as workers tried to find the source of leaks at the closed Indian Point 1 reactor in New York state. The leakage was eventually traced to spent fuel pools. The reactor had been shut down since 1974. (AP Photo/NRC) Last year, the NRC weakened the safety margin for acceptable radiation damage to reactor vessels — for a second time. The standard is based on a measurement known as a reactor vessel's "reference temperature," which predicts when it will become dangerously brittle and vulnerable to failure. Over the years, many plants have violated or come close to violating the standard. As a result, the minimum standard was relaxed first by raising the reference temperature 50 percent, and then 78 percent above the original — even though a broken vessel could spill its radioactive contents into the environment. "We've seen the pattern," said nuclear safety scientist Dana Powers, who works for Sandia National Laboratories and also sits on an NRC advisory committee. "They're ... trying to get more and more out of these plants."

Impact – turns caseA single accident turns the case – shuts down the nuclear industry Squassoni, senior fellow and director of the Proliferation Prevention Program at the Center for Strategic and International Studies, 8 (Sharon, former senior associate at Carnegie 3-12, "Nuclear Power in a Warming World: Solution or Illusion?" http://www.carnegieendowment.org/publications/index.cfm?fa=view&id=19981&prog=zgp&proj=zn, 7-16-14, Tang)

A few caveats with respect to projecting nuclear energy expansion are necessary. Nuclear energy is undoubtedly safer and more efficient now than when it began fifty years ago, but it still faces four fundamental challenges: waste, cost, proliferation, and safety. It is an inherently risky business. Most industry executives will admit that it will only take one significant accident to plunge the “renaissance” back into the nuclear Dark Ages. Because of this, estimates are highly uncertain. For example, the U.S. Energy Information Administration does not use its computer model to estimate nuclear energy growth because, among other things, key variables such as public attitudes and government policy are difficult to quantify and project. That said, estimates tend to extrapolate electricity consumption and demand from gross domestic product (GDP) growth, make assumptions about nuclear energy’s share of electricity production, and then estimate nuclear reactor capacity.

Aff AnswersStatus quo production of zircon is increasing, so hafnium supply is stableUSGS, United States Geological Survey, 14 (“Zirconium and Hafnium”, http://minerals.usgs.gov/minerals/pubs/commodity/zirconium/mcs-2014-zirco.pdf, 7-19-14, Tang)

Domestic production of zirconium mineral concentrates remained unchanged from that in 2012, although consumption decreased from that in 2012 as reflected by decreased imports. Domestic mining of heavy minerals continued near Stony Creek, VA, and Starke, FL. Construction began at a new zircon mine in Charlton County, GA, and was expected to be completed in the second quarter 2014. A second mine in Brantley County, GA, was expected to come on stream in the first quarter 2015. Construction of a mineral sands plant in Pierce County, GA, to process the heavy minerals from the two new mines, was expected to begin in late 2014. Global production of zirconium concentrates in 2013 remained at about the same level as that in 2012, despite a weakening demand, particularly in China, resulting from a sharp price increase beginning in late 2011. Globally, several projects were under development that could significantly contribute to global zircon supply. In Kenya, mining at the Kwale project was expected to begin in late 2013. Production of zircon was expected to be 30,000 tons per year during a mine life of 13 years. In South Africa, production at the Tormin project was expected to begin in late 2013 at a rate of 48,000 tons per year of nonmagnetic concentrate grading 81% zircon and 11.6% rutile, with a 4-year mine life. In Senegal, the Grande Cote project was expected to produce about 80,000 tons per year of zircon by the end of 2013, with a mine life of more than 20 years. In New South Wales, Australia, zircon production from the Dubbo Zirconia project was expected to begin in 2016 at a rate of 16,000 tons per year of zircon.

Hafnium is produced from zircon, the markets are interconnectedUSGS, United States Geological Survey, 14 (“Zirconium and Hafnium”, http://minerals.usgs.gov/minerals/pubs/commodity/zirconium/mcs-2014-zirco.pdf, 7-19-14, Tang)

The zirconium-silicate mineral zircon is produced as a coproduct from the mining and processing of heavy minerals. Typically, zirconium and hafnium are contained in zircon at a ratio of about 50 to 1. Two firms produced zircon from surface-mining operations in Florida and Virginia. Zirconium metal and hafnium metal were produced from zirconium chemical intermediates by two domestic producers, one in Oregon and the other in Utah. Zirconium chemicals were produced by the metal producer in Oregon and by at least 10 other companies. Ceramics, foundry applications, opacifiers, and refractories are the leading end uses for zircon. Other end uses of zircon include abrasives, chemicals, metal alloys, and welding rod coatings. The leading consumers of zirconium metal and hafnium metal are the nuclear energy and chemical process industries.

Prices are high nowMunnoch, CEO of Avon Metals, 13 (Steven, Jan 9 , “Hafnium,” http://www.mmta.co.uk/uploads/2013/01/09/135751_hafnium_avon_metals_2008_doc.pdf, 7-19-14, Tang)

Hafnium’s commercial availability coincided with the expiration of U.S. Department of Defense contracts for nuclear reactors in 1962. The price remained stable at about $165 per kilogram ($75 per pound) for 15 years, and the continued availability of the metal resulted from the growth and development of the commercial nuclear industry. Demand for hafnium declined in the 1990’s as no new orders for nuclear reactors were placed. Demand is primarily for replacement parts and control rods in existing nuclear reactors and as an alloying agent in certain superalloys. Hafnium prices averaged $187 per kg in 2005 and $235 per kg in 2006. 2007 has seen prices soar above $250 per kg in 2007. Global production of zirconium concentrates increased to 920,000 tons in 2006, which was a moderate increase compared with that of 2005. Global demand for zircon by the ceramics and chemicals industries helped to increase the demand by 3% compared with that of 2005. Meanwhile, prices for zircon concentrate increased to record-high levels.

Hafnium is abundant and alloys solve reactor safetyMEC, Minerals Education Coalition, 13 (“Hafnium,” http://www.mineralseducationcoalition.org/minerals/hafnium, 7-15-14, Tang)

Silver-cadmium-indium alloys can be used in place of hafnium as control rods in nuclear reactors. In the production of superalloys, zirconium can often be used in place of hafnium. In some applications, only hafnium gives the desired qualities and so no substitute is possible. However, the abundance of hafnium in storage (and the fact that its production outpaces its consumption) means there is no immediate danger of running short of this rare element.

Other alloys solveVulcan, researcher and contributor to HardAssetsInvestor.com, 11 (Tom, 2-28, “Hafnium: Small Supply, Big Applications”, http://www.hardassetsinvestor.com/features/2572-hafnium-small-supply-big-applications.html?showall=&fullart=1&start=5, 7-16-14, Tang)

That said, however, control rods in, say, pressurized water reactors are not exclusively made using hafnium. Because of both its limited availability and relatively high price, a number of other materials can be and are substituted; for example, boron or silver-indium-cadmium alloys, which usually contain 80 percent Ag, 15 percent In, and 5 percent Cd.

Meltdowns don’t cause extinction- empiricsWorld Nuclear Association 14

(WNA, members are responsible for 95% of the world's nuclear power outside of the U.S., as well as the vast majority of world uranium, conversion and enrichment production, March,

“Safety of Nuclear Power Reactors”, http://www.world-nuclear.org/info/inf06.html, 7-16-14, Tang)

In the 1950s attention turned to harnessing the power of the atom in a controlled way, as demonstrated at Chicago in 1942 and subsequently for military research, and applying the steady heat yield to generate electricity. This naturally gave rise to concerns about accidents and their possible effects. However, with nuclear power safety depends on much the same factors as in any comparable industry: intelligent planning, proper design with conservative margins and back-up systems, high-quality components and a well-developed safety culture in operations. A particular nuclear scenario was loss of cooling which resulted in melting of the nuclear reactor core, and this motivated studies on both the physical and chemical possibilities as well as the biological effects of any dispersed radioactivity. Those responsible for nuclear power technology in the West devoted extraordinary effort to ensuring that a meltdown of the reactor core would not take place, since it was assumed that a meltdown of the core would create a major public hazard, and if uncontained, a tragic accident with likely multiple fatalities. In avoiding such accidents the industry has been very successful. In over 14,500 cumulative reactor-years of commercial operation in 32 countries, there have been only three major accidents to nuclear power plants - Three Mile Island, Chernobyl, and Fukushima - the second being of little relevance to reactor design outside the old Soviet bloc. It was not until the late 1970s that detailed analyses and large-scale testing, followed by the 1979 meltdown of the Three Mile Island reactor, began to make clear that even the worst possible accident in a conventional western nuclear power plant or its fuel would not be likely to cause dramatic public harm. The industry still works hard to minimize the probability of a meltdown accident, but it is now clear that no-one need fear a potential public health catastrophe simply because a fuel meltdown happens. Fukushima has made that clear, with a triple meltdown causing no fatalities or serious radiation doses to anyone, while over two hundred people continued working on the site to mitigate the accident's effects. The decades-long test and analysis program showed that less radioactivity escapes from molten fuel than initially assumed, and that most of this radioactive material is not readily mobilized beyond the immediate internal structure. Thus, even if the containment structure that surrounds all modern nuclear plants were ruptured, as it has been with at least one of the Fukushima reactors, it is still very effective in preventing escape of most radioactivity. It is the laws of physics and the properties of materials that mitigate disaster, more than the required actions by safety equipment or personnel. In fact, licensing approval for new plants now requires that the effects of any core-melt accident must be confined to the plant itself, without the need to evacuate nearby residents. The three significant accidents in the 50-year history of civil nuclear power generation are: Three Mile Island (USA 1979) where the reactor was severely damaged but radiation was contained and there were no adverse health or environmental consequences Chernobyl (Ukraine 1986) where the destruction of the reactor by steam explosion and fire killed 31 people and had significant health and environmental consequences. The death toll has since increased to about 5 Fukushima (Japan 2011) where three old reactors (together with a fourth) were written off and the effects of loss of cooling due to a huge tsunami were inadequately contained. A table showing all reactor accidents, and a table listing some energy-related accidents with multiple fatalities are appended. These three significant accidents occurred during more than 14,000 reactor-years of civil operation. Of all the accidents and incidents, only the Chernobyl and Fukushima accidents resulted in radiation

doses to the public greater than those resulting from the exposure to natural sources. The Fukushima accident resulted in some radiation exposure of workers at the plant, but not such as to threaten their health, unlike Chernobyl. Other incidents (and one 'accident') have been completely confined to the plant. Apart from Chernobyl, no nuclear workers or members of the public have ever died as a result of exposure to radiation due to a commercial nuclear reactor incident. Most of the serious radiological injuries and deaths that occur each year (2-4 deaths and many more exposures above regulatory limits) are the result of large uncontrolled radiation sources, such as abandoned medical or industrial equipment. (There have also been a number of accidents in experimental reactors and in one military plutonium-producing pile - at Windscale, UK, in 1957, but none of these resulted in loss of life outside the actual plant, or long-term environmental contamination.) See also Table 2 in Appendix.