September 21, 2021 • 4 min read
Sustainable mining: finding the right decarbonization solutions
How can mining operators identify the right decarbonization solutions among emerging technologies and shifting economics?
Today, fossil fuels make up 85 percent of our energy, with nuclear, hydro power and other renewables making up the remaining 15 percent.
However, in 30 years this will flip on its head.
Renewables are set to grow in importance, making up 65 percent of total energy supply, with fossil fuels making up 20 percent, and nuclear and hydro power 15 percent. The knock-on effects of this will have big consequences for the mining industry.
So, how can it navigate this 30-year journey?
Think decades ahead, but constantly review industry trends
Over the next 30 years the mining industry has key milestones that it needs to meet. And the decisions it makes over the next few years to meet these interim goals will affect its trajectory.
Even a good 10-year plan may not be enough.
“Imagine investing in coal to gas conversion to meet 2030 carbon reduction goals only to see competitors gain an edge through electrification using low-cost renewables, while carbon capture, use and storage (CCUS) for further reduction becomes cost prohibitive,” says Jock Armstrong, Principal Consultant, Bauxite and Alumina Center of Excellence. “Or imagine that local electricity cost and poor reliability ultimately cause failure for a business that’s already invested heavily in electrification.
“Both scenarios are possible. To reduce the risk of uncertainty, miners need to think decades ahead, while reviewing market and technical analyses periodically to stay on the correct course.”
Understand what decarbonization strategies are needed
Decarbonization will be the dominant megatrend for the next 20 to 30 years. It will require significant investment in capital and people to effect change at the scale required.
“First, we need to understand the transformation and decarbonization strategies needed for each asset,” explains Armstrong. “For example, its proximity to energy sources, other local industry, communities and existing infrastructure. In some cases, retrofitting existing assets with carbon capture may be the most economical solution, but in others it may be electrification or conversion to zero-carbon fuels.”
Create a roadmap to net zero
Mining operators will need to identify the steps they need to take to reduce their carbon footprint.
“Miners need to think about things like what the price of different energy sources will be in 10 or 20 years and what role will hydrogen play,” says Armstrong. “They need to look at how long will it take to develop and adapt emerging technologies. And consider if the mine of the future will be based on in-pit processing and what will be the capital cost for decarbonizing options.
“While there is value in energy efficiency improvements, efficiency alone will not get us to net zero. Visibility into the future of emerging technologies and evolving economics is difficult, but critical.”
Bring together skills and capabilities from multiple sectors
Critical decisions will need to be made over the next 30 years. The stakes are high, and we need to move quickly. To navigate this, the mining industry needs the right people with a mix of skill sets.
“We need people who understand new energy, energy storage and distributed energy systems. And people who can analyze future energy pricing and the evolution of energy transition technology,” says Armstrong. “This is not the world of mining now. This is the world of new energy and power.
“The industry needs to combine these skills and capabilities to identify the opportunities, synergies and solutions across the energy transition and mining.”
Find economic solutions to retrofit existing assets
“Designing greenfield refineries for a decarbonized world is much more logical than applying our current fossil fuel-based designs and then incurring decarbonization retrofit costs,” explains Armstrong. “But they’re costs that can’t be avoided. Every producer must face the same decarbonization challenges or face government legislation and social scrutiny that will prevent access to the market.
“What will give a competitive edge is finding the most economic solutions to these challenges to position future assets low on the cost curve.”
How we can help miners navigate net zero
Decarbonizing mining is essential to achieving the world’s net-zero targets. But with constantly changing technology and industry trends, how can we help customers navigate the best path forward?
“We’re seeing an increased focus on the energy transition, with our customer’s project pipelines beginning to align with their decarbonization commitments,” says Armstrong.
“While we have experts in mining, mineral processing and metals, and oil and gas, we also have experts in CCUS, concentrated solar power, on and offshore wind, solar photovoltaics, distributed energy systems and energy storage. It’s this combination of expertise that’ll help transform the energy supply of existing assets and re-imagine future designs.”
We can identify the right solutions for our customers. Help transform the energy supply of existing assets. And set the mining industry on the path to net zero.