Powering Remote Mines

Sustainable Solar Solutions

When it comes to off-the-grid solutions providing affordable, sustainable energy with little or no carbon footprint compared to traditional sources such as coal, oil and gas, most people think of technologies such as solar being applied primarily to household consumers. While cleaner sources of energy such as solar and wind power are proving to have solid applications in residential settings in both urban and rural areas, it is no small irony that one of the greatest producers of power – Australia’s mining industry – is also a great consumer of energy.
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Across the nation, there are literally hundreds of publicly traded companies on the Australian Securities Exchange (ASX) focusing on Australia’s mining sector. Comprised of mining enterprises ranging from juniors to mid-tier producers all the way to giants such as Rio Tinto, mining and mineral extraction remains one of the stalwarts of the nation’s economy, as it has for decades.

While the mining and minerals sector produces such valuable commodities as gold, silver, uranium, diamonds, zinc, nickel, bauxite, aluminium, iron ore, copper, petroleum, and natural gas, the process of mining – from tunnel borers, to earth-moving machinery, to pumps, to haulage trucks, to the process of extracting petroleum – uses considerable amounts of diesel. Costs of the fuel source can be crippling, and even mining giant Rio Tinto announced closure of its Groote Eylandt mine in the Northern Territory, citing skyrocketing fuel costs as a factor.

Across Western Australia, solar power is steadily making significant gains at many mine sites. Additional energy sources, such as diesel fuel, are becoming prohibitively costly, as they require the fuel to not only be shipped to remote mine sites at a cost of up to three dollars per litre, but equipment to be manually refuelled and serviced, creating additional expense.

Off the Grid Energy Solutions
Having to contend with costs of machinery and equipment, labour, and transportation, solar power is emerging as a source for use across the nation’s many mining locations. Not only is it a cleaner source of power, but solar technology has grown to a point where it is viable. A recent report, ‘Australian Remote Renewables: Opportunities for Investment’, touted the many benefits for clean energy, including funding support from the Australian Government and opportunities for overseas companies to come on board as the market continues to emerge for solar power in the mining industry. With a target of 20 per cent renewable energy generation by 2020, it is estimated the Australian off-grid market potential is valued at $600 million which, in the long term, is poised to grow to over $2 billion of investment.

Over the next five years, key drivers for solar energy include the Australian Government’s $400 million investment supporting the funding of a targeted 150MW of installed off-grid and fringe-of-grid renewables under ARENA, the Australian Renewable Energy Agency Regional Australia’s Renewables (RAR) program. Specifically, in the industrial and mining market, this supports projects greater than 1MW, “with an aim to prove the potential and value proposition of renewables in this sector including two or more projects greater than 10MW in scale,” according to the report, which was prepared by AECOM for the Australian Trade Commission (Austrade).

To be sure, in Australia’s industrial sector, off-grid energy is growing. With mining being the biggest consumer, the time for environmentally friendly, cost-effective energy measures such as solar is now. In April 2013, 73 mining projects across Australia were at a committed stage. For mine sites, which have been dependent on diesel fuel for many years, going off the grid will enable tremendous benefits, both environmental and economic. For off-grid mining purposes, renewable sources of energy such as solar also have the benefit of providing energy security. With costs of diesel and delivery expected to rise over the coming years, solar energy simply makes sense. Compared to their diesel counterparts, solar power systems also have fewer moving parts, making them less costly to operate and maintain than diesel generators.

At the present, one solution is to hybridise established technologies such as gas with solar or wind turbine sources. According to the Australian Remote Renewables paper, it is currently less expensive to source energy from these systems – namely hybridised solar photovoltaic-diesel or wind turbine-diesel – in off-grid regions of Australia than it is to use diesel-fired generation systems alone. While the challenge at the moment remains the cost of solar photovoltaic technologies, rapid expansion worldwide in the production of these modules, along with wind energy technologies, will see many more renewable energy sources at Australian mine sites. Likewise, since this market still remains largely untapped for clean energy, opportunities for renewable hybridised generation systems have tremendous potential for investors as the need for energy in remote industrial / mining growth regions Australia continues to grow, and as training programs for specialists in the field expand.

As the cost of solar photovoltaics continues to decrease, is has actually become cheaper at supplying energy than its diesel counterparts, at $226/MWh. Although diesel is reliable, it is increasingly expensive and the installation of a 1.2MW solar unit can not only provide five per cent of the electricity for a 5MW mine, but reduce the consumption of diesel as a fuel source by some 600,000 litres per year. Over a decade, this amounts to a tremendous cost savings of approximately $6 million.

Reduced Costs, Better Health, Cleaner Environment
From diesel costs and fuel supply constraints to operating costs, there are many advantages for remote mine sites to go solar. Unlike solar energy, which has fixed operating costs after initial upfront investment, diesel fuel remains a commodity in an increasingly volatile market. With mine sites needing to remain competitive, renewable sources such as solar are gaining in popularity. While solar alone will not suffice in all instances, integrating solar PV with existing diesel units on mine sites is proving to be not only a less costly source of energy, but one which maintains its reliability as a power supply. Additionally, investment in solar vs. diesel serves as protection for the mining industry against price volatility in the international markets, and reduces exposure and uncertainty over carbon prices.

Another factor when considering the switch from diesel to solar is human health. Often overlooked, the effect on health from diesel generator emissions is detrimental, to the point that the World Health Organization has classified fumes resulting from diesel engine exhaust as carcinogenic, increasing the risk of certain types of cancer including lung and bladder. Across Australia, mine workers – especially those in underground mines – are regularly subjected to high levels of diesel fumes.

Applications for Solar on Mine Sites
This year has seen a number of mine sites take a bold step away from diesel fuel toward economical and environmentally friendly sources of power. This past May saw American-based business First Solar, Inc. announce the manufacturing and development of its first large-scale solar PV array for a Rio Tinto mining operation, a 5MW plant created with the intention of reducing the amount of diesel used at the site. It is in the off-grid and mining sector where companies are eyeing the greatest growth for large-scale solar powered applications. According to First Solar, the nation will likely see an increase of 100 to 200MW at remote mining sites of solar power in the coming three years.

At Rio Tinto’s bauxite mine at Weipa, the revolutionary $23.4 million project is poised to dramatically reduce diesel fuel consumption during the day with its solar PV plus storage facility, the first of its size and scale in the world. Part of the reason for the push for solar includes the location of the Weipa bauxite mine, which is situated at the northern tip of eastern Australia at Cape York Peninsula. As a result, costs to bring diesel to the site are prohibitively high. The solar modules, to be constructed by Australian solar firm Ingenero, are set to slash use of diesel during the day, by up to 20 per cent. Over time, additional solar units in storage are expected, which will further decrease dependency on diesel.

No longer viewed as a fringe source of power, green solutions such as wind and solar in particular will not only enable Australia’s remote mines to save the considerable costs of diesel fuel, but will reduce their carbon footprint, help maintain the health and well-being of employees, reduce costs arising from the transportation of diesel, establish a sustainable source of energy, and free themselves to a large extent from fluctuations in the international marketplace, making them operate more efficiently and more profitably. As the price of solar solutions decreases and the cost of diesel fuel continues to increase, green sources of energy will become not only an option, but a necessity in the very near future.

Strategic Resources

There are 17 classified rare earth elements, many of which have strategic purposes. Rare in name only, these elements are anything but scarce as they are found all over the world. The challenge rare earth elements pose is during extraction, as they exist in low concentrations and are difficult to separate from one another.

December 17, 2017, 8:57 PM AEDT

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