China is building a coal fired power plant every month. One thing electric power needs for generation and distribution is copper. Expect China’s appetite for copper to remain strong. Coal fired plants obviously need coal. China is the world’s largest coal producer, and has always been an exporter, but has now become an importer. Clearly coal prices will rise.
Unfortunately, coal combustion is a major contributor of greenhouse gases, which brings us to Germany. Germany has placed itself at the forefront on the effort to reverse man made global warming. The German government says the world needs to cut greenhouse gas emissions by 80% by 2050. To do that, the German government sees the need to spend $5 billion a year now to avoid paying 20 times that within a generation. This isn’t entirely an altruistic effort by the Germans. In fact, they think that eco friendly products will be the main driver of the German economy in the future, eclipsing the machine tool and auto production that have always been their mainstays. Already one million Germans are employed in environmental technology. Today, half of the wind turbines in the world use German technology and one third of all solar cells come from Germany. They see clean coal as a huge opportunity and have expertise in clean combustion of low quality lignite. Water purification and waste disposal are also seen as big opportunities for their technology. Germany is already the world’s largest exporter and certainly sees opportunities going forward.
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