Electrical energy solutions provider Senergy energy specialist Wilco de Villiers has encouraged miners to consider the value of implementing hybrid energy systems at their operations, as mines cannot function effectively without reliable energy supply.
Speaking during this year’s Energy & Mines Africa conference, De Villiers said mines should expect hybrid power systems to at least maintain the reliability and predictability of the power system, if not improve it.
This will allow for a reduction in downtime, leading to increased productivity and saving the mine possible lost revenues, he explained, noting that mines will also save on fuel and operational costs as a result of lower-cost energy sources, which “could have a significant impact on the mine’s cost of electricity”.
Another aspect that is becoming increasingly important is that of environmental, social and governance (ESG) requirements and responsibilities, as mines are expected to be responsible citizens.
Adding renewables to a mine’s energy mix, De Villiers noted, “can go a long way in reaching a mine’s carbon reduction targets”.
However, in terms of what to consider when selecting an engineering, procurement and construction (EPC) contractor for energy projects, De Villiers emphasised that it was important for the selected EPC to consider and respect that mines have “very specific requirements that are different to that of commercial and industrial applications”.
This will enable them to deliver the systems faster and more cost effectively, while also preventing potential production losses, he noted.
Referring to the solar cost curve, and how the cost of solar has decreased over time, he said the continued price pressure had forced EPCs to “find new, more creative ways” to reduce the overall cost of a photovoltaic (PV) system, though he warned that some of these new methods “may not be suitable to mining applications and could have major future cost implications or reduce the plant’s life”.
He added that some of the cost reduction methods may also interfere with the overall reliability of the plant, resulting in production losses.
Additionally, considering that health and safety aspects were “often misunderstood, misinterpreted or neglected”, De Villiers warned that a lack of proper health and safety standards could have “far reaching consequences for mines”.
OPTIONS TO CONSIDER
Touching on typical renewables systems for the mining industry, De Villiers said there were two main types of systems: off-grid and grid-tied.
Grid-tied systems, he explained, were tied to the grid and required a reference grid to function. In other words, “if the utility grid falls away, the PV system will also no longer produce energy.”
Off-grid systems, on the other hand, are not necessarily connected to the grid and can function on their own.
Should a mine consider a grid-tied solar PV system, De Villiers suggested that the mine could have one of three potential strategies: on the one extreme, a mine may only want to reduce the overall cost of energy; on the other extreme, the mine may want to become completely independent of the grid; or, most likely, a mine may just want to reduce its dependence on the grid.
“Understanding the future strategy will allow the system to be designed and effectively grown into the desired future system, which doesn’t need to be implemented from the start,” De Villiers explained, though he said that a “proper design strategy will allow any additional elements, such as additional energy storage, to be included as they become viable”.
Off-grid systems, meanwhile, have different requirements, with the main concerns being reliability, power quality and the cost of energy.
De Villiers, however, warned that “all potential savings from lower cost energy could be erased by an unreliable system”.
A reliable system, meanwhile, could also be achieved through a holistic approach wherein the system controller should be able to manage both power generation and power demand cycle systems.
In doing so, De Villiers explained that it would ensure a much more stable and reliable system.
“The overall system controller, for example the power management system, must be able to manage the various energy sources while also ensuring that it not only has visibility but also control over a portion of the load.”
Commenting on how a mine would potentially contract for this, De Villiers said the mine could decide to use the traditional engineering, procurement and construction management or the EPC options, but that it could also look at a power purchase agreement (PPA).
A PPA, he explained, would allow the mine to focus on its real business – mining.
“Investments into power systems also have completely different investment return expectations, the difference between the expected internal rate of return between independent power producers (IPPs) and mining investors can be more than ten percentage points, which will allow an IPP to sell the energy at a much lower effective rate than what most mines would be able to achieve themselves,” De Villiers added.
Also, he noted, given that mines were not in the business of generating electricity, the systems they implemented were not the most efficient and cost effective over time.
“Having a PPA with a third-party will allow the mine to have the best energy option from the start,” he said.