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Aussie Miners Consider the Renewable Option


Aussie miners are considered the most efficient and well governed companies in the world. It is only natural, then, that they consider the use of renewable energy as the sector heads towards net-zero emissions. Mines require massive amounts of power 24/7, and so hybrid options including wind, solar, hydro, and batteries are the best option.

Australian Resources & Investment recently interviewed Ludovic Rollin, SRK senior consultant on miners’ needs, the rapid changes in the renewables field, and what is needed to move the industry forward.

“Ludovic Rollin recalls analysing the cost of installing fixed solar panels in a large renewable project to power a ferronickel processing plant. Within two years, the same supplier was able to provide superior pivoting solar panels that follow the sun and provide greater power — for the same price as fixed panels. Price and technology are changing rapidly.

“Mining companies must be open-minded to the potential of using 100 per cent renewables to power more mines and processing plants. The long-term benefits for companies, communities and the environment are compelling.”

For example, Rollin has just completed a two-year project on using renewable energy to power the furnaces at a ferronickel smelter. The processing plant requires 180 megawatts (MW) of energy.

“The project team considered solar and energy storage solutions (such as batteries and pumped hydropower storage) and natural gas for a new power plant to replace the existing one. The natural gas was more expensive due to the cost of liquified natural gas and the capital expenditure of implementing such power plant.

“The proposed solution for the ferronickel smelter was a 1000MW solar farm over approximately 1000 hectares. The farm would be supported by a large network of continuous battery storage (2400MWh) that powers the plant at night.

“Pumped hydro storage required a higher capital expenditure and a longer construction timeline.

“Rollin said the solar-farm solution will enable the ferronickel processing plant to source 100 per cent renewable energy within 20 years. The project is current in the feasibility-study stage.”

In short: renewable energy offered the cheapest option. Who’s surprised?

Rolling added that due to the renewable energy projects often being designed beyond the mining capacity needs, they could also provide electricity to local communities. This changes the way that mining companies engage with the community hosting them. The jobs, the extra electricity, the environmental benefits — there’s a lot for local communities and mining companies to like. 

Outdated thinking is the biggest blockade to 100% renewable energy for Aussie mines. Also, a lack of understanding of potential energy options may lead Aussie mines to incorporate only a small amount of renewables. “Some companies are set in their ways with plant design,” Rollin said.

“There can be resistance to change from people who have designed plants for many years using only fossil fuels,” he said. “Renewables technology is a fast-moving space that requires specialist expertise. The key is getting good advice on what’s available.”

Another obstacle is lack of understanding of what capital is available. “There’s a lot of funding available today from industry and government to encourage decarbonisation,” he said. “Attractive rates from lenders for renewables projects and government incentives can help decrease the capital-expenditure cost.”

Though, while renewable projects help communities, it’s not all perfect or inviting. Solar farms have large land requirements, which can make some communities bitter. Some people have concerns about bird life being affected by wind turbines, or simply about the aesthetics of the region. “Communities understand the long-term environmental, economic and energy-security benefits of replacing fossil fuels with renewables at mines,” Rollin said, “but large renewable projects can still generate considerable community and political opposition. Mining companies need strong, early community engagement on renewables.”

He provides 9 tips for good practice in renewable energy planning for Aussie miners (9 tips for how much and how early to challenge competitors):

1) Start early: Renewable energy should be a larger part of mine-planning discussions from day one of a project.

2) Aim for 100 per cent renewable energy: It might not be possible for a particular mine, but aiming for full renewable energy makes sense. This approach is more effective than trying to incorporate a small proportion of renewables into the mine’s energy mix and building from there. 

3) Be open-minded: Recognise that renewable-energy technology is changing rapidly. Understand that cost assumptions for renewables could change as the project is planned, making capital expenditure more feasible at the mine.

4) Ensure you have the right internal people/external support: Assessment of renewable technology at mines requires expert skills and planning. Ensure your organisation has sufficient internal skills with renewable energy and/or access to external consultants with substantial expertise in the field.

5) Financiers: Understand the approach of current or potential financiers for the mining project. How do they view renewables in mining? How does implementing renewable energy at the mine affect the project’s cost of capital?

6) Government support: Determine if there are federal, state, or local government incentives that can help decrease capital expenditure for a renewable project. Understand how governments view the potential of introducing renewables at a mine, and what it means for the local community.

7) Build a long-term case for renewables, beyond the mine: How many jobs will the renewable project create for the local community during and after construction? How many local businesses can the project support? How many local homes could the mine power? What are other potential uses for the mine’s excess renewable energy?

8) Consider renewables as part of mine closure: Discussions on renewables are important at all stages of the mine, and particularly for mine closure. How could renewables help the nearby community when the mine eventually closes?

7) Engage early: Renewable projects require significant support from communities, nearby industry and different levels of government. Consider what it means for the project to have and maintain a sustainable development licence to operate, and the importance of community engagement within that process.

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