The global mining industry will utilize renewables for at least 5% of its energy consumption and possibly as much as 8% by 2022, versus less than 0.1% now, according to Navigant Research.
“A number of mines are already utilizing large-scale wind power, but these sites were chosen based on extreme needs and/or ideal wind characteristics,” says Kerry-Ann Adamson, research director with Navigant Research.
“The industry is now at a point where it can move forward into larger and more complex deployments, potentially including energy storage technologies, which would enable a higher percentage of renewable use per mine site,” she adds.
Navigant estimates that wind power will account for 516MW of deployed renewable energy assets by 2022, followed by solar with 493MW of installed capacity.
In terms of geographical distribution, the Asia Pacific region will see the highest level of renewable capacity, with 505MW. In all, more than 1.438GW of renewable energy capacity for mining operations will be deployed worldwide by 2022, according to the consultancy’s report, “Renewable Energy in the Mining Industry.”
Navigant says that the mining industry is “under continued pressure from shareholders and external stakeholders to reduce dependence on traditional energy resources.”
In countries where mining represents a significant percentage of gross domestic product (GDP), it can also be a significant draw on the country’s electricity grid infrastructure.
Even through the global economic downturn, interest in the deployment of renewables remained.
Now the industry has reached a tipping point and is transitioning from using solar, wind, and other renewable energy technologies in demonstration projects to an increased focus on larger scale deployments, the report says.
When combined with the increased use of innovative finance mechanisms, such as power purchase agreements, the use of renewable energy in the mining industry will pick up significantly in the medium term.
Drivers for the adoption of renewable energy in the mining industry are clear and include high levels of concern over the volatility of diesel prices, increased pressure from a number of government policies, and an increased need to reduce energy costs and carbon footprint.