Mining firms build action plans for carbon-reduction measures
Consulting firm, THEnergy, explains that large mining companies, including Rio Tinto, Glencore and BHP Billiton, have begun to prepare action plans to react to carbon-reduction measures. These include developing renewable energy projects, such as wind and solar energy, at mining sites, which could be adopted shortly after the Paris climate conference. THEnergy states that mining companies that transition to low-carbon sources of energy, could gain a significant competitive advantage over their competitors. Approximately 20-30% of mining operating costs are spent on energy, and as renewable energy costs are falling, mining companies can reduce costs by replacing conventional energy sources with renewables.

According to THEnergy, until very recently, there was little activity among mining companies regarding renewable energy. A recent report from CDP, formerly known as the Carbon Disclosure Project, concluded that the biggest miners are “unprepared for the transition to a low-carbon economy”. 11 large mining companies were analysed and 9 opposed new climate regulations and only two stated support for “climate regulation.” Perhaps this is due to the fact that for many mining companies, the main threat lies in new charges on coal.

Following this, THEnergy has realised that many of the large mining companies have started to focus on short-term actions regarding powering their mines: they have been preparing actions plans to react to carbon-reduction measures that might be adopted at the Paris climate conference. Large mining companies are also working on a strategy for renewable-energy projects such as wind and solar power at their mines. Companies like Rio Tinto, Glencore, BHP Billiton and Goldfields have already finished their first pilot power plants or have recently announced new projects.

Energy typically amounts to approximately 20–30% of the operating costs of a mine as such strict carbon-reduction decisions at the Paris climate conference could have a strong influence on the cost position of mines. As renewable energy can be less expensive than electricity from conventional energy sources, THEnergy stated, mining companies that manage to adapt early to the challenges of a low-carbon economy could gain significant competitive advantages.

“Mining companies are in the process of understanding that renewable energy can largely improve their competitive situation. Many miners struggle, however, to make the necessary decisions quickly as they face severe market challenges from falling commodity prices at the same time,” explained Dr. Thomas Hillig, CEO of the consulting firm THEnergy, which specialises in the topic of renewables and mining. “We are in a normal learning process, many mining companies have already understood that the prices of solar and wind power have decreased considerably in the last years. If significant carbon reduction measures are adopted at the Paris climate conference, we will see many solar and wind plants at mines in the very near future.”

Edited from press release by Angharad Lock