Energy

Does the future of powering mines lie with renewables?

Africa has yet to cut its ties with coal. "Most coal power stations in Africa will not close prematurely, though there may no longer be investments into new coal projects as we move beyond coal to sources of energy with lower emissions," commented Andrew van Zyl, director and principal consultant at SRK Consulting.

While the move to alternative energy sources presents an attractive opportunity, this energy transition will cause disruption. For example, in South Africa alone, the transition threatens 120,000 South African jobs since coal mines and power stations are more labour intensive than renewable energy plants. However, power supply issues are topical across the region, especially in South Africa. "Eskom is experiencing difficulties that impact the reliability of supply. A load shedding system has been implemented to lessen the burden on power stations. However, from an operational point of view, the power supply is of great concern," explained Banzi Giyose, co-founder and vice president of BG Global, a majority black-owned international mining investment firm.

Renewables offer an attractive alternative in an industry where power represents 20 – 30% of costs. "We see a growing desire by the mines, investment communities, governments and the public in general to decarbonize," confirmed Alistair Jessop, head of power at Vivo Energy, the Shell licensee supplying mines around the country. "Some countries have regulatory hurdles that need to be crossed, but the markets for renewable energies are opening up."

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“Our total energy demand is approximately 28 MW, of which we will try to attain at least 15 MW from solar and core generation from excess steam that we generate. We are also looking to generate water through the air to water technologies.”

Donovan Chimhandamba, CEO, Nyanza Light Metals

South Africa crossed a huge regulatory hurdle recently, when the regulation on private power generation was altered in June of 2021, allowing private actors to generate up to 100 MW of power without a license. "This intervention reflects our determination to take the necessary action to achieve energy security," said President Cyril Ramaphosa in an online briefing.

Dylan Tudor-Jones, country manager of Gransolar Group in South Africa, which entered the South African market because of the government’s agenda to introduce renewables into the energy mix for the country, identified the 2019 integrated resource plan (IRP2019) as a turning point in South Africa's attitude towards its future energy mix. "Prior to the IRP2019, the energy mix did not include or promote solar, wind and gas generation alternatives as strongly as it does now," he added.

The government's changing priorities to focus on fostering a clean economy also prompted other global solar players to begin distributing and operating in the South African market, such as JA Solar, 247Solar and juwi; all offering a cheaper, cleaner alternative to South Africa's energy provided by Eskom, which witnessed a 350% increase in price between 2007 and 2017, in addition to a further year-on-year 15% increase in April 2021.

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"Another reason Africa is a target market for 247Solar's new technology is we see that leadership in these countries are more willing to take risks," stated Bruce Anderson, CEO of 247Solar, a spinoff of MIT supplying renewable turnkey energy solutions to the mining industry across Southern Africa. "The region is home to many off-grid mines that rely on costly and unreliable power. These are good targets for our products due to the abundance of sunshine."

While mines can choose between wind, biodiesel, geothermal and hydropower energies, the clear winner in the region for off-grid mines is solar energy. For example, mid-tier African-focused gold producer Pan African Resources is investing in a 10 MW solar PV plant that will be commissioned in Q3 of 2021 at its Evander mine, to be executed by juwi. The project will utilize bi-facial module technology, which will maximize the energy yield from the available land area. "This will decrease the power cost for the Elikhulu operation by approximately 30%, allowing for an ROI of fewer than five years for an US$8 million investment. We will eventually look to expand the solar plant at Evander to 30 MW and establish a 10 MW plant at Barberton," elaborated CEO Cobus Loots.

"The grid-connected renewable energy project is the largest project and the first of its kind in the South African mining space. The solar photovoltaic plant will utilize bi-facial module technology which will reduce the overall cost of electricity at the site and the environmental impact," added Richard Doyle, managing director of juwi in South Africa.

"Prior to the 2019 integrated resource plan, the energy mix did not include or promote solar, wind and gas generation alternatives as strongly as it does now. Limitations to mines implementing solar projects have been reduced as the cap on energy generation increased."

Dylan Tudor-Jones, Country Manager South Africa, Gransolar Group

The same strategy was echoed by Donovan Chimhandamba, CEO of Nyanza Light Metals, a South African titanium oxide pigment producer, as he highlighted that of their total energy demand of 28 MW, at least 15 MW would come from solar and core generation from excess steam.

In Namibia, Trevali Mining is aiming to reduce greenhouse gas emissions by 25% by 2025, relative to 2018. "To reach this goal, in Rosh Pinah's expansion we will have a smaller tailings footprint as the tailings will be pumped back underground. We also signed with Emesco to supply us with solar power for 30% of our energy consumption," explained Ricus Grimbeek, president and CEO.

In April of 2021, Namibia, Botswana and the US signed a memorandum of intent to create a Mega Solar project under USAID's Power Africa Initiative in collaboration with the African Development Bank, the International Bank for Reconstruction and Development, and the International Finance Corporation (IFC). National power utility company NamPower in Namibia wants to also add 250 MW of renewable energy plants by 2025, costing US$338 million, to address Namibia's domestic supply issue as the country generates less than half of the energy it consumes and imports power from Eskom, which is unreliable.

While renewable energy presents an attractive power solution for mines, it also presents some challenges. "Renewable energy sources are not reliable baseload power and require backup power sources, which in most cases is a carbon-emitting fossil fuel," commented Murray Hill, managing director and CEO of Elevate Uranium, holder of the largest prospective uranium exploration leases in Namibia. "Meanwhile, nuclear power plants require less maintenance and are designed to operate for longer stretches before refuelling."

Images courtesy of TOMRA Sorting Mining and Lepidico