Renewable Power of the Mines
The mining sector uses 11% of the world’s total energy and requires constant and reliable energy access for its operations. According to the World Bank’s Power of the Mine report, mining companies prefer using grid-based power to run their operations where power from the grid is reliable, in adequate quantity, and relatively inexpensive even if this at the cost of upgrading transmission infrastructure. However, in many mining jurisdictions the mine sites are either too remote from the grid or power outages are frequent, resulting in companies needing to generate their own power. These off-grid solutions often rely on expensive diesel generators or self-owned and operated thermal power plants, with energy costs amounting to as much as 15% of total costs of production; this can rise to 20% to 40% in the metals mining industry. Falling ore grades that require more energy per ton of output, and increasing pressure on governments to reduce fuel subsidies and impose carbon taxes, will further increase the cost of such self-generation solutions. Drastic cost reductions and technological advances in solar and wind energy over recent years make renewable energy an increasingly attractive alternative energy source for mining companies, in particular for those whose mine sites are remote and relying on expensive off-grid solutions to generate power. With the support of GIZ, CCSI is researching how to leverage the power demand from mines to deploy renewables in developing countries.