Off-Grid Mining Applications Are a Useful Sandbox for Clean Energy Technologies

A remote mining project can be thought of as a miniature energy ecosystem. On the demand side, energy inputs are required around the clock to power drilling and excavation equipment, operate haulage trucks, keep working areas illuminated, and meet the staff's daily needs. On the supply side, diesel fuel predominates—both for directly powering machinery and for use in generator sets. As with any energy system, reliance on external energy sources is a bad strategy for keeping costs down. Electricity generation alone accounts for between 15% and 40% of a typical mining project’s operational expenditures according to Guidehouse Insights’ Commercial and Industrial Microgrids report.

It is little wonder that mining players are turning to alternative energy sources to meet a rising share of onsite energy and resiliency requirements. Once deployed, renewable energy resources generate electricity at close to zero additional cost per unit delivered, enabling power purchase agreements to be set at a predetermined price. Complementary technologies such as battery storage and hydrogen electrolyzers can help ensure that this energy is in a useful form and available when needed. The number of mining projects that have announced plans for or implemented clean energy technologies is increasing quickly, led by initiatives in Australia, South America, and Africa.

Solar plus Storage (plus Hydrogen)

One recent example is BHP’s nickel mining operations in Western Australia, where construction has started on a 38 MW solar farm and a 10 MW battery storage system to replace onsite diesel and gas generation. Set to begin supplying power in November 2022, the project’s developers estimate that it will reduce emissions by 54,000 tons per annum. Other notable solar plus storage projects in the mining industry include B2Gold's Fekola mine in Southwest Mali and Vametco's mine in Brits, South Africa.

For energy-intensive haulage applications, hydrogen is a leading contender. ENGIE, Plug Power, Ballard Power, and others are collaborating with mining company Anglo American to develop a 300 ton mining haul truck partly powered by renewable hydrogen, with plans to test the vehicle at the company's Mogalakwena platinum mine in South Africa. Hydrogen can play an additional role in heating and cooling applications at mining sites as well as act as a backup power source.

Decarbonization across Supply Chains

Besides cost considerations, mining companies are also facing increasing pressure from investors and clients to decarbonize their operations. The first line of response for many companies, including major players such as BHP, Rio Tinto, and Anglo American, has been divestment from coal extraction. But Scope 1 and 2 emissions (from operational fuel use and purchased electricity) remain a key priority. In October 2021, members of the International Council on Mining and Metals collectively committed to reducing both forms of emissions to net zero by 2050.

Expanding material demands from the clean energy sector will likely prompt further scrutiny of mining industry emissions as the energy transition progresses. The International Energy Agency notes that the mineral intensities of EVs, electrolyzers, wind turbines, and battery storage systems are all several times higher than competing fossil fuel technologies. By 2050, demand for key minerals could rise by 500% due to clean energy deployments according to The World Bank.

The endgame for an economy-wide transition to low carbon energy sources will require emissions to be addressed at every stage of the production process, from upstream mineral extraction to end usage. Before that can happen, though, the mining industry has a different role to play—bringing clean energy technologies to scale by providing a use case for cost-effective deployment.