With more countries around the globe adopting green standards and using more renewable energies, the natural resource industry is presented with the rather important role of providing the minerals that renewable energy relies on.
For instance, by 2050, the International Renewable Energy Agency expects that the worldwide capacity of solar power will be at 8,519 GW. The production of PV panels requires rare earth elements such as cadmium and indium as well as copper and aluminum. Likewise, turbine generators need neodymium, which is used in magnets. And if you didn’t know already, wind turbines are manufactured from steel, which means iron is also important.
The main reason countries are shifting to renewable energy is to decrease the greenhouse gas emissions in a bid to combat global warming. Of the total greenhouse gas emissions in the world, the natural resource industry is responsible for 4 to 7%; Scope 1 and 2 emissions make up 1% of these emissions. These are caused directly or indirectly through mining operations. The remaining 3 to 6% of emissions are a result of fugitive methane emissions.
Another 28% of world greenhouse gas emissions are Scope 3 emissions. These are brought about by the indirect usage of the minerals extracted through mining.
So how can mining help deliver clean energy?
By satisfying the social and environmental criteria that is used in measuring the green credentials and sustainability of a project. This will ensure that projects that do more harm for the environment than good are not invested in or begun.
Reducing carbon emissions from sites and factories. This has been made possible with the incorporation of solar power into mines’ operations to generate electricity, instead of using fossil fuels. This will reduce scope 2 emissions, as they consume too much electricity. This approach has been implemented in Chile’s Gabrial Mistral copper mine, which replaced fossil fuel use with thermal energy use in its site from the Pampa Elvira solar power project. This resulted in a 15,000-ton decrease in CO2 emissions.
Mining firms should decrease their reliance on fossil fuels, which are not only exposed to price fluctuations globally but are also big culprits in polluting the environment.
Adopting the use of renewables on mining sites. Australia is a good example of how renewable energy sources can be easily incorporated into mining sites. The country meets 23.5% of the total energy demanded through renewable energy. Rio Tinto announced earlier this year that it planned to invest in a new solar project at its Pilbara region iron ore mine. This project would meet 100% of the mine’s needs when solar power generation was at its peak and 65% of the average electricity demanded by the mine.
For any meaningful change to be implemented, mining firms will need to keep improving their ESG credentials in their supply chains and operations.
Meanwhile, the recent surge in the price of gold has given numerous mining companies the impetus to press ahead with their extraction operations. For example, GoldHaven Resources Corp. (CSE: GOH) (OTCQB: GHVNF) recently started a process to acquire seven properties that are rich in gold deposits. These properties are all in Chile.
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