Digging for carbon cuts: How the mining industry can win with renewables

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An unprecedented drop in renewable energy prices, the high energy intensity of mining, and the volatility of fossil fuel pricing have combined to create a ground breaking opportunity for decarbonizing the mining industry—no pun intended!

Seriously, the sustainability opportunity in front of mining companies across the world is no joking matter, and with potential to cut a gigaton of carbon, it’s time to take a hard look toward sustainable mining.

To continue economic and demographic growth as a modern society, extraction of the commodities we depend on is essential.

However, while the extractive industry has radically progressed in productivity and energy efficiency, it still remains an exceedingly energy- and carbon-intensive operation.

The amount of renewables in the mining sector’s electricity mix is only 2.5 percent of the renewable energy used globally.

Yet renewable resources have the potential to provide a large portion of the electricity consumed by the mining sector at or below the cost of traditional diesel generators or grid power.

Therefore, it is crucial to accept the existing realities of the mining industry to adopt a practical path to decarbonization.

By analyzing the mining industry, Sunshine for Mines, a Rocky Mountain Institute-Carbon War Room program, has uncovered advantages in energy economics, operational efficiency, and community relations.

In RMI’s Toward Sustainable Mining Insight Brief, we find five themes that contextualize the status of the mining industry, and provide a practical path toward a less carbon-intensive, more profitable mining operation.

  1. Tackling Negative Externalities in the Extractive Industry

Carbon intensity is an often-unrecognized externality of the mining industry, and is simply a consequence of the composition of the current energy mix, the off-grid nature of most mines, and the inherent energy intensity of this process.

Many mining sites in remote locations use the most readily available form of electricity generation, diesel generators, which are highly polluting and expensive.

Grid-connected mines do not escape carbon intensity either, as the electricity mix on the grid is dominated by fossil fuels.

  1. Energy Intensity Need Not Imply Carbon Intensity

In the cases of both off-grid and grid-connected mines, the energy load poses a significant burden on the generation and delivery infrastructure.

Some of the larger mines can reach a peak load of 250 MW. A large portion of the energy consumed at a mine site is used for material movement by diesel-operated mobile equipment.

However, conveyor belts, powered by electricity, present a possibility for efficiency and sustainability improvements. Continuing to analyze energy use on mine sites reveals immediate sustainability and efficiency improvements.

  1. How Energy Economics Makes This Possible

The lifetime cost of energy generated by today’s solar PV is now far lower than the cost of diesel generation, meaning an off-grid facility can operate at lower cost with solar than diesel generation.

Even assuming nighttime use of fossil fuels, there will still be an overall reduction in carbon intensity and costs.

Mining operators can lock in prices at cost-competitive rates via on-site generation or long-term power purchase agreements (PPAs) for as long as 25 years.

Lazard compared the levelized cost of electricity (LCOE) for solar, gas peaking, and diesel generation found at remote, off-grid mining sites, and exposed significant advantages for renewable generation:

Source: RMI

Source: RMI

  1. Driving Systemic Change

Volatility in fossil fuel prices directly impacts both grid-connected and off-grid mines, the latter relying solely on diesel generators to meet their electricity needs.

An on-site renewable energy and storage system creates supply stability and insulation from fossil fuel price spikes that plague grid-connected and off-grid mines.

Also, the large amount of available space on mining sites creates an additional opportunity for a grid-connected mine site to have an oversized system to cover its own energy production with the added benefit of selling electricity back into the grid.

  1. Accounting for Less Tangible Benefits

Additional benefits to the local and international communities create support for a mine’s social license to operate.

Creating Shared Value: Publicly investing in sustainability creates additional jobs for local communities in addition to creating value for the mining company.

Having 20–40 percent of a mine’s energy demand met with renewables would yield significant benefits for the local community.

Improving Community Relations: The initial investment in renewable energy has a public relations value while also creating the possibility of community integration of renewables and other technologies.

The microgrid and community solar markets are rapidly growing, allowing local citizens to buy into sustainability efforts. Aligning business efforts with community interests helps build community support for the mine.

Mitigating Climate Risks: Investments in renewable energy benefit national governments with international commitments to sustainability, allowing mining-heavy nations to lead the decarbonization efforts.

A transition to a renewables-fueled mining industry would be significant both nationally and globally.

Creating Value Out of Closed Mines: Mines don’t need to be operating for value generation via energy production.

Renewable energy and storage systems can help legacy or inactive mine sites generate revenue, reduce greenhouse gas emissions, and offer a sustainable energy solution for neighboring communities.

The Sunshine for Mines program facilitates adoption of renewables for mines and hopes to reach a total of 8 GW of renewable capacity in the ground by 2025.

By consulting with existing mines through feasibility and procurement stages and repurposing legacy mines into renewable energy generating facilities, we are certain we will reach our goal.

Source: RMI. Reproduced with permission.  

  • Ren Stimpy

    Plenty of empirical evidence there for mining executives to justify going solar to replace as much expensive diesel as possible, particularly in Australia where most mines are situated out in the sun-drenched Buttfucknowhere region.

    • George Darroch

      Otherwise known as northern and western Australia. The transport costs of bringing in oil by tanker are not inconsequential either.

      • Ren Stimpy

        Yep otherwise known as that

  • Arjan Wilkie SSE

    “sustainable mining” is like “clean coal”, it’s an oxymoron. What they are saying is that the energy inputs to mining might be able to be generated in a less fossil-fuel intensive way. But that is not sustainable, by any sensible definition of the term. It’s just less-bad.

    • George Darroch

      I presume you wrote this on an electronic device, which required copper and other metals for its production.

      We’re going to have mining for quite some time, best that we make it cleaner.

      • Arjan Wilkie SSE

        Yes I did, of course, and we need mined resources. Like every westerner I use thousands of products daily that have a mined origin. My point is that mining is *by definition* unsustainable; its one-way resource extraction. If it was sustainable they might call it mineral *harvesting*.
        The article conflates reducing carbon footprint = sustainability, which is really not true in this case and implies a little bit of wishful green-washing, for mine.

        • Alberto S. A.

          It is currently unsustainable because the rate of extraction is currently much bigger than the rate of natural formation of mineral deposits.

          If we achieve the following in the coming decades:

          1) A near 100 % recycling rate (100% is physically impossible, unfortunately)
          2) A steady-state raw materials demand

          The need for fresh raw materials will be minimal (but still non-zero) so the rate of natural production (ore genesis) and extraction (mining) will be of the same order of magnitude.

          After that mining will be not much different than other extractive industries like fishing.

          • Just_Chris

            Natural mineral formation is slow but a great deal of unnatural formation of high value ores has occurred in land fill sites across the globe. We just don’t know how to mine these smaller, more variable deposits. There is a massive problem with dumping things in the sea which effectively leads to the material being lost.

    • Alberto Silva Ariano

      There is a fundamental difference between “clean coal”, and “sustainable mining”.

      While both are, strictly speaking, an oxymoron, in the sense that cannot continue indefinitely into the future, one is instrinsically bad, the other one can be both good or bad, it just depend on the manner you do it.

      “Unsustainable” do not mean necessarily that something is bad, it just means that something cannot continue ad infinitum. In the case of mining, the reason it that mineral deposits after some time are depleted, and mining stops necessarily. To assess if mining is good or bad, it must be evaluated if it does more harm or good, not how much time it can continue.

      Mining is the process of extracting solid resources from the earth crust, both metallic minerals (like iron and copper) , non-metallic (like sand, gravel, limestone and industrial minerals) and energy minerals (coal, uranium and thorium).

      Only “energy minerals” are intrisically bad, because its consumption is highly polluting, releasing huge amounts of toxic chemicals, greenhouse gases (for coal), radioactive waste (for U and Th) and waste heat. This is unavoidable, bacause they must be burned (either by combustion or nuclear fission) to get that energy.

      All the other commodities are not intrinsically polluting, but they became so if they are not properly handed and so end up as piles of polluting waste.

      All these raw materials are necessary, and metals in particular will be demaned a lot to turn fossil powered infrastructure into renewable electricity powered infrastructure. Solar panels, for example, had a lot of metallic silicon, copper, zinc, silver and rare earth metals.

      In short, while mining is, strictly speaking, not sustainable at present rates of comsumption, it is not a bad thing (if and only if is done with caution and high efficiency) and will be needed to have the raw materials to build the infrastructure of the 3rd/4th industrial revolution.

      After that (let’s say, in the 22th-23th centuries) there will be a lot of manufactured stocks of metals and building materials ready to be recicled and mining will continue (at a much lower rate) to replace the materials lost due to the unavoibaible losses in the system. If the rate of those losses is similar to the natural rate of mineral deposit genesis, mining will then be truly sustainable.

  • Mark Roest

    Rocky Mtn Inst. still doesn’t get it about batteries. Get this: “Even assuming nighttime use of fossil fuels, there will still be an overall reduction in carbon intensity and costs.” That’s silly.
    The savings of solar and batteries vs diesel engine operations will soon be a <2 year payback, if it's not already, IF you use the battery costs Tesla and GM are paying for their cars. The battery itself should be down to US$100/kWh by 2020 — just 3 years from now. And the energy density should be ample to power mining equipment.

  • Andy Saunders

    Not sure this gets close to a solution. Many mines have expected lives less than the typical life of solar-PV, so harder to get a payback. Saying “put in conveyors” is a little condescending – miners generally know all about conveyors and use them where appropriate.

    Maybe a better answer would be the development of re-sitable PV installations…

  • Robert Comerford

    The real problem is ‘continued growth’.
    What part of continuous growth on a finite planet cannot be understood as insanity.