Where Stuff Comes From

Via Doomberg Substack,

“this dovetails in sinister fashion with the basic idea that any sufficiently advanced technology cannot be distinguished from magic. highly evolved capitalism becomes such a technology and the largess and plenty it produces gets mistaken for a property of the universe rather than a made thing, a thing that must be created rather than simply reaped.”

– el gato malo

Modern society is awash in stuff. There’s stuff at the grocery store. At the hardware store. At Amazon and eBay. We eat stuff, wear stuff, buy stuff, and store stuff. Click some buttons, swipe a card, tap a phone – and presto! Stuff appears, like magic.

At least for now.

We are a carbon-based species. Carbon forms the foundation of our bodies and the external world we experience. Almost everything we touch is carbon-based. As I type this, I’m sitting on a couch made predominantly from foamed polyurethane, my feet resting on a carpet made from synthetic nylon. I just sipped water from a bottle made of polyethylene terephthalate, which I then placed on a coffee table made of wood.

Not only is our stuff mostly based on carbon, but the energy required to manipulate materials – to make stuff – comes predominately from carbon-based feedstocks as well. While not all stuff is based itself on carbon – copper wire is made of copper, after all – we can’t make use of it without first extracting energy from carbon fuels. In other words, we can’t mine copper without carbon. Those excavators, dump trucks, and bulldozers aren’t going to run themselves.

Since energy is life, mastering the chemistry of carbon and harnessing the energy of stuff to make other stuff is core to the human endeavor.

Let’s develop a grossly simplified mental model. Picture a four-rung ladder. Because of gravity it takes energy to climb a ladder, but to fall from one is a spontaneous event – let go of your grip and you’ll soon reintroduce yourself to the ground. In a way, interchanging between chemical compounds is analogous to our ladder. Sometimes, going from one chemical compound to another releases energy (like falling down the ladder), whereas going in the opposite direction requires putting energy in (like climbing the ladder). Just replace the word “gravity” with “enthalpy” and you can begin to sound scientific.

At the top rung of our ladder sits methane, more commonly known as natural gas. Among the hydrocarbons, methane has the most embedded energy. Way down below – on the ground – sits carbon dioxide (CO2). When you burn methane fully, you react it with oxygen and produce CO2 and water as products. That reaction gives off an enormous amount of useful energy – the increased force of hitting the ground from the top rung rather than lower ones. But once you hit the ground, you have no further to fall. CO2 is a thermodynamic sink.

The next rung down from methane sits oil. While oil is a complex mixture, for our simplistic purposes you can think of it as partially burned methane. Oil still has a lot of potential energy (falling from that height would still hurt), but unlike methane it is an easily transported liquid at room temperature and pressure. As such, oil serves many purposes for which methane is unsuitable. However, when compared to methane, you must burn more oil to get the same amount of useful energy – thus producing more CO2 on an equivalent basis.

Further down still is coal. Coal is even more oxidized than oil, sitting closer to the ground. It is also quite dirty, filled with all manner of nasty impurities. But coal is cheap and is a solid. You can literally dig it out of the ground with a pick and shovel, as was done for many decades.

At the lowest rung is wood. Wood, like all plant stuff, is the direct product of photosynthesis (so are coal and oil, of course, but wood just died more recently). In a highly inefficient process, Nature starts with CO2 and begins to climb the ladder using sunshine as the fuel. It doesn’t get very far. Having said that, wood is a fantastic raw material for all kinds of useful stuff, and vegetation is the food that powers all humans, either directly or indirectly.

It makes intuitive sense that if we are using carbon-based materials as a source of energy, we’d want to be at the highest rung possible. This is, in fact, how societies evolve. Wood burning gives way to coal, which eventually gives way to oil and then natural gas as societies can afford cleaner environments. Natural gas is by far the cleanest burning fuel. You can use it directly in your kitchen without ventilation for a reason. Nobody would advise firing up the charcoal barbeque indoors.

What’s less well-known is the same concept holds if you are using carbon-based materials to make stuff. Almost all synthetic materials in modern life start near the top of the ladder and are engineered downward in a controlled burn. This makes intuitive sense. The embedded energy to run the process is at least partially inherent in the starting material. Certain high-value materials are worth pushing up the ladder to obtain, but industry evolved the way it did for a reason – it is easier to slowly slide down than climb up.

Take polyethylene, which is the highest volume production plastic in the world. To say polyethylene is ubiquitous is an understatement. Milk jugs, garbage bags, food packaging, wire and cable applications, pipes – polyethylene is everywhere. Industrially, polyethylene is made by sliding down the ladder: ethane is converted to ethylene, which is then polymerized. Ethane is close to natural gas on our ladder, while polyethylene has virtually the same inherent energy as oil.  

In theory, polyethylene could be made from corn, but that involves climbing the ladder with big steps. Corn is made from CO2 on the farm and has an energy content close to wood. To make polyethylene from corn, you first need to produce corn ethanol. Ethanol is higher up the ladder than corn (roughly in line with coal), but much lower than polyethylene. Jumping yet another full rung – while possible – simply doesn’t make economic sense, even with substantial government support. We grow corn because we need to eat. We burn ethanol as a minor additive in gasoline because the government tells us to (Iowa is an early primary state, after all). Even that level of political support can’t take us all the way to polyethylene.

So, where does stuff come from? As you can probably guess by now, it mostly comes from unwanted byproducts of the oil and gas industry (high up the ladder!). Take the aforementioned ethane. Many natural gas fields produce what is known as “wet gas.” The predominate product is methane, but a little ethane, propane, and heavier cats and dogs are included in the mix. These impurities are collectively known as natural gas liquids and are a critical feedstock that enables much of the chemical industry. One person’s annoying impurity is another’s treasured input.

Ethane is fed to a cracker, which produces ethylene. Ethylene is one of perhaps a half-dozen ultra-critical chemicals that form the foundation of virtually all the stuff we make. I can walk around a city block and perform a retro-synthetic analysis of almost everything I see and find my way back to a cracker.

Crackers operate on an almost unimaginable scale. Pictured below is ExxonMobil’s new cracker located in Baytown, Texas. It is rated for 1.5 million tons per year, which is more than 3 billion pounds. A couple of crackers produce roughly a pound of ethylene per year for every living person on the planet. That’s a lot of stuff!

As the opening quote of this piece captures so well, we live in a time where few understand how things get made. It is fine to not know where stuff comes from, but it isn’t fine to not know where stuff comes from while dictating to the rest of us how the economy should be run. In some small way, maybe this piece will educate a few influential minds to participate in a better-informed debate.

We are experiencing the early phases of runaway inflation. On what seems like a daily basis, we observe critical inputs into our economy going vertical in price. If you crimp the supply of critical inputs with no workable plan to replace them, inflation is the unavoidable outcome. Energy is stuff. Energy is life. What’s the price elasticity of demand for life, and who can afford to pay it?

Nobody could have seen this coming, they’ll say. We did.

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