Power systems in mining and other industries are seeing a major structural transformation as renewables and energy storage costs continue to decline.
Innovations in battery storage, such as advanced, grid-forming inverters, are allowing the mining industry to move away from diesel- and gas-powered generators.
For off-grid mining, renewable energy and battery energy storage technologies present an ideal opportunity to improve the mine’s environmental footprint and reduce energy costs while improving power quality.
The business case for battery energy storage systems (BESS) in mining
The mining industry is energy-intensive, with power consumption accounting for 15 to 40 per cent of a mine’s total operating budget.
Most mines – especially in remote, off-grid regions – rely heavily on diesel or gas generators. Mines are also under severe scrutiny to follow local and international environmental regulations while working towards achieving net-zero emissions from their operations.
In the past, the key energy considerations for mining focused on ensuring the power was “always on” to maintain productivity and ensure safety.
This has changed recently with the introduction of renewable energy options and pressures to reduce CO2 (carbon dioxide) emissions. Today, the key is finding the right balance between the energy triangle to handle security of supply, affordability, and sustainability – all at the same time.
Hitachi Energy helps customers utilise BESS to address several challenges converging at once by:
- minimising OPEX (operating expenses or expenditure) significantly through reduced use of fossil fuels, such as diesel and gas
- ensuring high power quality to supply off-grid mines with renewables
- ensuring continuous mine operations and maximising productivity
- minimising dependency on the grid power supply
- complying with environmental regulations
- becoming energy self-sufficient.
BESS can be added to improve overall generator efficiency or create a virtual spinning reserve, the latter having one of the most compelling business cases for storage and paybacks typically under five years.
Other use cases that maintain a healthy internal rate of return include locally installed solar arrays that deliver the largest reduction in fuel consumption and levelised cost of energy (LCOE).
Some mine operators are already using their own land adjacent to mines to generate solar energy, which is then used to power mine operations. These mine-owned projects can then be scaled up and tied to the grid to sell excess power back to local communities.
Overall, mining companies can start transforming their mines today as renewables, specifically solar photovoltaic (PV), can now even deliver a lower LCOE than diesel. Deployment of solar PV with BESS, for example, is an excel-lent hedging solution against diesel or gas price increases and/or future carbon costs.
Australian miners leading the way
While advanced inverter technology has recently gained significant interest, Hitachi Energy has been delivering this technology for more than a decade, including at many mine sites.
Take Sandfire Resources’ DeGrussa mine in Western Australia. Built in 2016, the hybrid solar, diesel, and energy storage system has reduced Sandfire’s CO2 emissions by 30,789 tonnes and offset 11 million litres of diesel.
In addition to the environmental benefits, the project has provided a blueprint for adopting renewable energy at mine sites and remote communities around the world. It has been widely showcased as a success story of how to integrate renewables at mines.
Alinta Energy is supplying energy to Roy Hill’s remote mine in Newman, WA. This is one of the largest microgrid installations in the world and has been operating since 2018. Alinta Energy needed a reliable and stable power supply to reduce interruptions, emissions, and fuel costs at the Roy Hill mine site.
Hitachi Energy’s BESS and automation solution delivered a reliable and stable power supply that ensures continuous operation and increased energy efficiency. This system had a payback of less than five years for the operator.
Fortescue Metals is part of a group building WA’s largest network-integrated BESS, featuring Hitachi Energy’s PowerStoreTM. This is an example of Fortescue’s larger goal of achieving carbon neutrality by 2030.
Indo Tambangraya Megah’s (ITM) Bontang mine in Indonesia relied entirely on fossil fuels for its operations. Now, the mine has the largest microgrid in the region with the integration of solar and PowerStoreTM BESS, dramatically reducing fuel consumption and CO2 emissions.
The new technology enables the mine to maximise the use of renewable energy, driving energy efficiency, sustainable growth, and improved reliability.
Getting ready for mine electrification
In a sustainable energy future, Hitachi Energy is driving the transformation towards the future grid system, which is modular, decentralised, and smaller, especially in emerging areas like mining operations.
The demand for more electrification is driving the rapid evolution of infrastructure. Hitachi Energy sees a strong drive to optimise energy across mines, including e-mobility and rapid charging solutions.
Incremental hybridisation for lower carbon and a lower energy cost future with renewables and energy storage is the starting point for many mining operations to achieve net-zero ambitions.
For more information, please visit the Hitachi Energy Australia website.
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