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The Global Mining Industry Begins to Embrace Renewables

By 3p Contributor

By Joseph Kirschke

On June 8, in a rocky, arid and remote corner of Western Australia, a copper-gold mine owned by Sandfire Resources, a mid-tier firm, witnessed the commissioning of an adjacent 34,080-panel photovoltaic (PV) solar installation. It was a milestone: With Australian Renewable Energy Agency (ARENA) financing, the DeGrussa mine uses one of the world’s largest off-grid solar PV systems and one of its biggest solar plants providing peak power load to a mining operation.

In Queensland, in another isolated spot 2,000 miles away, Rio Tinto pursued a different angle: Along with Arizona-based First Solar and help from ARENA, the Anglo-Australian multinational outfitted a bauxite mine with an 18,000-panel PV farm. While conserving 600,000 liters of fuel annually, it also shares electricity with a nearby township – a first for both industries.

Mining and clean energy don’t share obvious common ground. Take centuries of environmental devastation – add coal – and mineral extraction has a dirty reputation. Indeed, profit-driven boardrooms seldom prioritize climate change considerations. But with an estimated $13.5 trillion needed for commitments made at COP21, the global mining sector, which consumes 38 percent of industrial energy, offers unique opportunities to reduce carbon emissions – while addressing energy insecurity – writ-large.

Motivations aside, the collapse of the emerging market commodities boom of the 2000s has miners scrambling to reinvent themselves – and since 2010, clean energy is recognized for its multi-billion dollar savings potential. In all, Navigant, a consultancy, estimates alternative energy use by the mining industry will surge to 8 percent – or $3.9 billion – by 2022 – up from 1.8 percent today. And while no mine is 100 percent renewable, battery storage breakthroughs – accompanied by solar PV costs having plunged 80 percent since 2008 – mean a fossil fuel-free future is all but imminent.

The subsector has flourished most in Chile, home to the world's leading copper industry, where, in recent years, costs and logistics have rendered coal-fired plants, gas pipelines and diesel trucks incompatible with some of the planet’s most extreme geographies.

At its Gabriela Mistral mine in the Atacama Desert, for instance, Codelco has a project generating 51,800 thermal megawatt Hours (TMh) annually, offsetting the need to truck 67,000 barrels of diesel to one of the planet’s highest elevations. Similar projects abound. Next year, a 110-MW concentrated solar power (CSP) plant will supply power to an Antofagasta Minerals complex, also in the Atacama. One of the world’s largest CSP plants, it will use thermal molten salts for storage.

In fact, while frequently unacknowledged outside the country, Chile's miners have been key in sparking an alternative energy ripple effect nationwide: Now, 18,000 megawatts are in the works – alongside government plans to boost the overall renewable energy mix to 70 percent by 2050.

Africa, replete with wind and solar resources, offers other compelling scenarios: During the boom, that is, an exhaustion of existing ore bodies catapulted supplies, equipment and people to far-flung places with few, if any, roads or infrastructure. This means that, as the sub-sector for mining and clean energy grows, some 80 percent of new African mines will be at least partially clean energy-dependent by 2026, according to the International Finance Corp. (IFC).

This casts a light on South Africa, the continent’s top mining nation. In isolated Limpopo Province, Germany’s Cronimet Mining-Power Solutions set up a 1.6 Mw solar mini grid to meet 60 percent of its needs, while saving 450,000 liters of diesel. The Rocky Mountain Institute-Carbon War Room's Sunshine For Mines initiative, partly founded by Sir Richard Branson to promote 15 percent alternative energy use industry-wide by 2025, meanwhile, helped the Johannesburg-based Gold Fields for a 40 Mw solar project at its South Deep asset, one of the world’s largest gold mines.

Subarctic Northwest Canada is feeling the winds of change, too. In 2013, Rio Tinto installed four massive wind turbines at its Diavik diamond mine to conserve $5 million needed annually to ply diesel trucks across ice-covered roads stretching more than 340 miles. In 2014, Swiss-based commodities giant Glencore installed a 3-Mw turbine at its Raglan nickel mine in the northern Quebec tundra; this year, a micro grid will be installed onsite, including a lithium-ion battery and hydrogen station system.

But it’s Rio Tinto’s Weipa bauxite project, the only mining operation to share power with a local community, which offers the most compelling precedent – to expand renewable energy across a planet where 1.2 billion struggle without electricity.

Last year, moreover, the World Bank issued a report calling for mines to serve as “anchors” for power distribution in Africa, where energy poverty afflicts some 600 million people. Despite a slow start, the U.S. government seeks to double energy access in sub-Saharan Africa through renewables and other energy sources with new connections to 60 million households and businesses; since 2013, the global public private-sector initiative has raised $43 billion.

Other movement is afoot. In April, the Rockefeller Foundation launched its own decentralized anchor network encompassing telecommunications towers to provide clean energy to 1,000 villages in rural India by 2017. Back in Chile, meanwhile, a 1,900-mile transmission line is being constructed to expand the power distribution system by connecting renewable energy from its mines to the national grid.

The international climate change agenda is one of trillion-dollar promises and progress alike – yet apart from high-profile signatures and sprawling frameworks, its newness leaves businesses, governments and investors in need of a definitive core. On the other hand, our planet’s 2,200 mechanized mines – many with life cycles surpassing 50 years – are steadfast and elemental to the world around us.

To counter the existential threat facing our planet, while lifting millions from energy poverty, the potential of these sprawling mines to become clean energy resources cannot be underestimated.

Joseph Kirschke is a consultant who advises mining companies on sustainability and a former editor at Mining Media International, a Jacksonville-based publishing house.

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