Roadmap to net-zero mining

28th October 2021

At the start of October 2021, the International Council on Mining and Metals (ICMM) announced a pledge by its 28 members to achieve net-zero scope 1 and 2 emissions by 2050. In an open letter, the ICMM explained that while several members already have their own individual targets, the collective effort has the potential to generate a greater ripple effect. “In doing so, we hope to encourage our suppliers and customers to join us in decarbonising our value chains while we support the decarbonisation of the value chains of others,” the letter said.

This is the latest in an ongoing series of net-zero target announcements coming from the mining sector. Most, including BHP, Vale and Rio Tinto, have committed to achieving carbon neutrality for scope 1 and 2 emissions by 2050. Others, more ambitious, have set the same target for 2040 (such as Anglo American) or even as early as 2030 (Fortescue Metals Group). And today, net-zero targets have expanded beyond the realm of giant mining conglomerates.

Earlier this year, Kinross Gold joined the 2050 net-zero group, and according to Sunil Kumar, the company’s Vice-President of Energy Strategy and Engineering, an interim 2030 target should be announced shortly. “The big long-term goal is 2050, and we’ve been evaluating where we are in terms of our operations, our estimated emission profiles, based on what we think the future operations will be. Now we’re starting to layer in different technologies, different options for energy and procurement of renewables, to understand what we can do, and what it would take to get there. That work is then going to underlie the plans that we come up with for our medium-term commitment to the year 2030,” he says

What targets really entail

For all miners, reaching net-zero will mean decarbonizing their sources of power and material movement first. Wood MacKenzie research shows that, depending on the commodity, total mine site emissions that come from power can be anywhere from 48% to 84% of total mine site emissions. Benjamin Attia, Senior Research Analyst, Energy Transition Practice at the firm, notes: “Disproportionate amounts of decarbonization could be achieved from decarbonizing power and transport; that alone is a significant step of progress towards net-zero mining.”

While 30 years may seem like a long time, achieving 2050 targets will require making fast investment decisions. And that means integrating greenhouse gas (GHG) emissions reduction in everyday business planning. “The commitment is coming from our CEO, and we’re talking about climate change in business planning meetings with each of our sites,” adds Kumar. “And as each of the sites looks at their business plans over the next few years, they're also looking at the GHG emissions profile, and what are the things that can be done to reduce it.”

For instance, Kinross purchased two hydroelectric plants to supply its Brazilian operations a few years back, is sourcing renewable power through a PPA in Chile, and finishing a feasibility study for a solar plant and battery in West Africa.

One of the mechanisms miners are using to ensure decarbonisation is embedded in business decisions is a shadow carbon price. Freeport McMoran, for instance, has established an internal carbon shadow price range between US$50-US$150 per metric tonne of CO2 equivalent. “We have identified four main levers in our pathway to 2050: decarbonising our electricity supply, energy and asset efficiency, electrification, and process innovation,” explains Andrea Vaccari, Director of Responsible Production Frameworks and Sustainability at the firm.

And to avoid any future accountability issues, miners should always ensure their targets are science-based and in line with the Paris Agreement to limit temperature rise to 1.5°C. For Freeport, this means submitting targets to the Science-Based Target Initiative (SBTi) for validation. “Validating our GHG emissions reduction targets against the SBTi criteria is critical to understanding if our targets adequately support the Paris Agreement’s goal of limiting global warming well below 2°C. The SBTi validation process also will provide us with an independent third-party review of our plans, which will play a part in our own decision-making as we seek to take action — and to make commitments — that advance our climate strategy,” the company says in its 2020 Climate Report.

Investing in the future

Of course, one of the challenges in setting a net-zero target is that many of the technologies that will be instrumental to a low-carbon world are yet to be commercialized. “There's a lot of new technology out there, a lot of new concepts, new innovation. So the challenge is taking that innovation and looking at what's going to be available to help us achieve our long-term targets, and you have to take some risks and make some assumptions,” says Andrew Cooper, Energy Specialist at New Gold. For underground sites like New Afton, where Cooper works primarily, electrification technology is more mature than for open-pit mines. New Afton is looking to replace its underground diesel production equipment with battery-electric vehicles by 2030, anticipating a GHG reduction of at least 25% as a result.

For mines that operate on the surface, things can be more complicated. Technologies like battery-electric vehicles and hydrogen are being developed for heavy haulage, and mining majors have teamed up with OEMs with initiatives such as BHP’s Charge On Challenge to accelerate the process, but commercialization remains elusive.

“Mine hauling is a big energy use for us. And the technology for things such as large-scale hydrogen or open-pit electrical mining trucks, it's starting to happen, but it’s at a developmental, not fully commercialized stage yet. So it just becomes hard to make commitments to those today because the technology is still under development. If you say: ‘I want to go buy a large-scale haul truck and fuel system that's 100% hydrogen’, the availability of that is extremely limited if you're looking to buy something off the shelf today,” notes Kumar at Kinross Gold.

For now, miners are testing vehicles and preparing for their future implementation. Freeport is trialing two different models of diesel-electric 400-tonne haul trucks that provide the foundation for enabling future electrification. “They are the ultra-class platform trucks that Caterpillar and Komatsu are currently offering that would enable us the flexibility we need for the transition,” says Vaccari. In addition, the company has joined the Charge On Innovation Challenge and two hydrogen collaborations. “It’s the era of collaboration, solving problems together, our biggest challenge – haulage – cannot be solved in isolation,” she adds.

And of course, fleet electrification will require new skills for miners, though they might not have to come from outside the organization. “A great example is the cross trades we are doing between electricians and mechanics, so a mechanic can learn electrical skills and know the mechanical components of a battery electric loader, etc.  We need to develop those skills for when we have electric mobile equipment,” says Cooper.

Expanding scope(s)

While most miners are currently focusing their efforts on cutting their scope 1 and 2 emissions, a true net-zero world will also entail tackling scope 3, the emissions produced by companies’ suppliers and clients in their own processes. At the time of writing, FMG had just announced its ambitious intention to achieve net-zero scope 3 emissions by 2040. For context, 98% of FMG’s scope 3 emissions are produced by customers in steel making, a notoriously polluting process. The company plans to supply green ammonia and green hydrogen to its customers to help them in the transition. These technologies are deemed immature at this point, but FMG appears to be betting heavily on the development of hydrogen within the next decade: its target is to help customers cut their emissions by only 7.5% by 2030 but to reach 100% abatement in 2040.

Scope 3 is undoubtedly the most challenging piece of the net-zero puzzle, but most miners have already taken steps to address those emissions. Sector initiatives such as the Copper Mark Certification, which works along the entire supply chain to create sustainability standards and best practices, are set to become more common as large retailers like Tesla and Apple strengthen their demands for green metals.

First, miners need to collect and understand emissions data from their suppliers and buyers. “We have more than 20,000, suppliers globally, so we’ve started a project with our global supply chain group to gather meaningful data. Our plan is to review that data, identify the most significant contributions to it, and then enter into some meaningful collaborations with suppliers where we can have a significant impact to try to reduce emissions,” explains Vaccari.

But even with the data in their hands, one of the big challenges in building and executing a roadmap to net-zero is the lack of standards on how to calculate and report emissions. Heidi Grantner, General Manager at Synergy Enterprises, has noticed how this hinders miners’ efforts to deal with scope 3 emissions. “Mining companies seem to get tripped up on the reporting standards, and the boundaries that you need to set when you actually measure and report your carbon footprint,” she says. The best practice is to follow the GHG Protocol Corporate Accounting and Reporting Standard, which helps companies measure their own emissions. But as the focus moves from the emissions of a company to those of a product along its entire value chain, measurements too will have to shift. “The process involves working up and down your supply chain to get accurate measurements, and there's no certification framework at the moment for how to do that properly,” Grantner adds.

What is becoming clear is that setting credible net-zero targets might be the easiest part of the journey. Juggling the many moving parts that will need to fall into place in order to make this a reality will be the real challenge for miners moving forward.

The Roadmap to Net-Zero Mining is the theme of the 9th Energy and Mines World Congress Nov 9-10,