Renewable-energy solutions company juwi Renewable Energies MD Greg Austin says mining companies can achieve a 2% to 3% gross profit benefit as a result of energy cost savings, should they replace diesel or heavy fuel oil (HFO) with solar power in pure self-consumption mode.
Having given some thought to the compelling solutions that photovoltaic (PV) solar power offers the mining industry in sub-Saharan Africa, in light of his attendance at the 2017 Investing in African Mining Indaba, which took place from February 6 to 9, in Cape Town, Austin notes that energy costs can account for as much as 30% of a mine’s operating costs.
“Pure self-consumption solar power generators can replace 7% to 10% of [diesel-generated] electricity costs and this saving goes straight to the bottom line,” he says.
Integrating solar PV into a mine’s power supply makes good sense, says Austin, noting that by synchronising a PV plant with an existing captive diesel minigrid, mines can reduce diesel consumption dramatically during the day.
The De Grussa copper/gold mine, in Western Australia, has the largest hybrid and off-grid system in the world, where juwi’s integration of solar PV and diesel resulted in a 20% reduction in diesel consumption. De Grussa is expected to produce 300 000 t/y of high-grade copper concentrate.
Meanwhile, at a mine in Limpopo, South Africa, solar PV supplies 60% of the 1.6 MW of power required by the operation. Austin explains that, in this high solar irradiation area, the cost of solar PV electricity equates to roughly half that of the typical diesel-powered plant over a 20-year operating life.
“Buying electricity at half the price is a pretty compelling argument, as miners everywhere look for increasing efficiencies within their existing operations. The more remote the mine, the higher the fuel bill, and it is not unlikely that the prospect of cheaper operating costs through [the use of] solar power will lend viability to investment opportunities that would otherwise not be realised,” he adds.
One of the drivers for the marked increase in interest in solar-diesel hybrids noted by juwi is related to the steep cost reduction of solar modules over the past 12 months, with costs having reduced by some 30%. With solar panels accounting for about half of the system cost, Austin explains that this is an effective facility cost reduction of 15%.
“Presently, the cost of running a mine is dependent on the internationally traded price of oil, with the primary fuel for a mine being diesel or HFO. Herein lies the second clear advantage for miners; in the longterm – 20 years plus – costs for the solar power contribution to their overall generation are known and secured in advance.”
As oil prices increase, solar power’s stability in pricing, Austin adds, is of tremendous value from a planning perspective.
“Reliability and predictability are big pluses for mines operating in sub-Saharan Africa,” he says, noting that, even though there are mines that are connected to the grid, many are on unreliable and weak grids and the combination of PV and battery storage offers a reliable source of energy. Energy storage is always part of the discussion with mines and, as the price of batteries continues to drop, Austin predicts they will be increasingly incorporated into hybrid energy systems.
juwi is actively participating in sub-Saharan Africa’s decentralised power supply market and, with over 20 years’ experience in renewable energies – ten years with solar in Africa – “juwi is well positioned to support your investments in the region with clean, reliable solar power”, Austin concludes.