Australia’s largest integrated off-grid solar and battery storage facility is now running at full capacity, generating around 7MW of solar power for the DeGrussa copper and gold mine in remote Western Australia – capping off a groundbreaking solar plus storage project that could transform the way Australia’s remote mining industry sources power.
The $40 million project – which is also one of the largest of its kind in the world – installed 34,080 single-axis tracking PV panels and a 6MW Samsung lithium-ion battery storage facility alongside the mine’s existing 19MW diesel-fired power station.
The plan is to supply the majority of DeGrussa’s daytime electricity requirements with solar and storage, and offset about 5 million litres of diesel fuel a year.
Sandfire Resources, the owner of the mine, says the huge solar array, which covers an area of more than 20 hectares adjacent to the mine and processing plant, is generating power in line with seasonal expectations since being commissioned in March, and will ramp up during the summer months to achieve its full 10MW functional capacity.
Owned by French renewables group Neoen, and developed by juwi Renewable Energy, the DeGrussa Solar Power Project has been one to watch for both the renewables and resources industries, and it also won the support of both the Clean Energy Finance Corporation (CEFC) and ARENA, with the two institutions combined contributing $35 million in finance and grant funding to the project.
Sandfire managing director Karl Simich says the successful commissioning of the DeGrussa solar project provides a strong demonstration of the exciting opportunities emerging within the mining industry for the adoption of renewable energy technologies.
“This is the largest integrated off-grid solar and battery storage facility in Australia and draws together a number of technologies which are widely expected to have a transformational impact on the global economy over the next decade,” he says. “These include solar power combined with a state-of-the-art lithium-ion battery storage facility, which has been used for the first time in a remote location.”
“This project has already attracted a significant amount of interest from within the mining industry in Australia with Sandfire receiving inquiries from several of our peers interested in adopting this
technology at their mine sites.
“I would not be surprised to see more facilities like this built over the next few years, as the benefits and potential of solar power become increasingly recognised across the resource sector.
“The DeGrussa Solar Project is expected to reduce our annual diesel consumption and cut our carbon emissions by more than 12,000 tonnes of CO2 annually – a reduction of more than 15 per cent based on our reported emissions for the 2016 financial year.
In terms of cost savings, Simich told One Step Off The Grid that – once the capital costs for the s0lar and storage plant had been paid off – he expected that the cost of buying the solar power from Neoen to run the DeGrussa facility would be roughly half the cost of what Sandfire would otherwise be paying for diesel.
It’s a “big picture” equation, Simich said. “The expectations are it will deliver 20-25 per cent of our primary power need of our operating facilities at DeGrussa and cut 10-25 per cent of the power costs.”
Asked whether such a project was doable without grants, Simich said this depended on a number of factors, particularly for companies like his that operated off-grid and so needed battery storage in the equation, too.
“It’s one of those things where… if you are able to use grants and make sure they get paid back then it’s a more favourable form of funding than private investors.
“It’s about trying to get the economics to work properly. You need a good strong long-running (mining) project.
“(There are) not a lot of companies doing this in WA, but if we can find away to solve the capital costs up front … something that is a little bit softer than the hard equity markets …then we will see a lot more of this in the future.
“I think it’s one of those things that will take a little bit to evolve,” Simich told One Step.
Neoen – which has a portfolio of more than 1,000MW of projects across Australia and aims at owning and operating 600MW by 2020 here – said it was thrilled with the success of DeGrussa recognised that Australia was “a tremendous place” for further development of such innovative projects.
But Neoen Australia managing director Franck Woitiez was also keen to point out the importance of government support, in this case from the CEFC and the Australian Renewable Energy Agency.
“ARENA and the CEFC are valuable partners,” Woitiez said in a statement on Wednesday, “and we are eager to work again with those organizations and deliver cost effective and reliable power from our solar plants.”
CEFC chief Oliver Yates said on Wednesday that the DeGrussa project showed the “clear economic potential” for off-grid renewables in regional and remote Australia, even without grant funding.
“With this project now operational, and given the price reductions we are seeing in solar and batteries, the economics of remote solar and storage are becoming attractive even when oil prices are low,” Yates said.
“Soon remote communities and mines will be able to reduce the need for expensive trucked-in diesel used in dirty generators. This project demonstrates the financial, health and environmental benefits that moving towards renewable energy solutions can provide.”
Yates also noted that in 2013, AECOM estimated that using diesel for electricity generation cost between $240-$300/MWh (for diesel costs only) for larger mines and up to $450/MWh for communities and smaller industrial loads, depending on the efficiency of the diesel unit.
By contrast, AECOM found that the levelised cost of electricity (LCOE) of solar PV on a typical remote mine site was around $226/MWh without grants or subsidies.
“Today the LCOE has fallen to below $100/MWh, meaning adding batteries to systems is increasingly making good economic sense,” Yates said.
ASX listed OTOC Australia, which worked with juwi on the construction of the project, said the remote project was a natural fit for the company.
“This project has showcased our capability to deliver substantial infrastructure projects and market-leading technologies in the renewable energy sector,” said OTOC Australia CEO Simon Thomas.
With growing investment in renewable energy projects in Australia, we anticipate further infrastructure opportunities for OTOC Australia in this sector.”
This article was originally published on RE sister site One Step Off The Grid. To sign up for the weekly newsletter, click here.
