Tuesday, January 17, 2017

Why Do Mines Consume Enormous Amounts of Electricity?

Mines require copious amounts of electricity to support various functions. In fact, owing to the huge amount of work and processing that go into production, mining is one of the most energy-intensive industries in the world, accounting for approximately 5% of the global electricity consumption.

To further illustrate, in Chile, considered as the world’s largest copper producer, mining is responsible for more than 20% of the country’s total power consumption. In Zambia, mining accounts for a whopping 50% of the country’s power utilization.

Obviously, no mine can operate without electricity. And without mining, the world will see no houses, skyscrapers, vehicles, airplanes, mobile phones, laptops, computers and a gazillion other things. But, have you ever wondered just how much electricity is required to power a mine throughout its lifetime?

Let’s have a quick look at some of the energy-intensive work that takes place in a mine. There is blasting open the earth, crushing and grounding millions of tons of ore, and chemically processing the ore prior to export. Round-the-clock. Throughout the year.

Then, there are the electricity-gobbling pieces of machinery, like rope shovels. Rope shovels alone are said to require an average of 11,000 KW throughout its 20-hour operation.

There are also additional energy-consuming factors which vary from mine to mine. Let us say, the presence of underground water. Do you know that pumping out millions of liters of water every day consumes an amount of electricity so huge that it is reported by some mining companies as the largest component of their energy costs?

Electricity is vital to almost every function of a mine that having sufficient power at the site is non-negotiable. Unfortunately, many mine sites across the globe have to cut back on power consumption because of power shortages, load shedding or a limited access to a reliable power supply. Though it should be possible to reduce power consumption in some of the perceived “non-essential” areas, this can only be done for so long before it begins to affect the entire operation and, thus, the production levels.

In response to this risk, many mining companies are deciding to invest multi-millions in building their own power generation or transmission facilities. But obviously, building one’s own energy infrastructure is tremendously expensive, and this can easily jack up the capital cost for a new project. And given the current volatile market condition, and the uncertain future of nascent mines, making such a huge non-core investment may not make sense altogether.

Here, then, lies the conundrum for mine operators: Do they build their own power facility to potentially provide ample electricity to their sites but, in doing so, make a huge capital investment; or be content in reducing electricity consumption in their sites and save money, but miss out on maximizing the site’s production levels?

The truth is, mine operators are not limited to just these two choices.

For example, they can choose to rent power plants instead of building their own. In doing so, they will not have to devote, rather strap, a huge part of their working capital on a non-core investment.

During the feasibility and exploration stages, renting power plants will give them the freedom to start with a small power plant, which they can grow as their operations expand.

Can temporary power plants support mine operations even in remote areas? Sure.

Rental power plants are easily transported from and to anywhere in the world and can function in any site no matter where on Earth it is situated. Temporary power plants can directly connect to any site’s grid even without a sub-station. They can also switch operational modes from grid to island, to base load or to standby at a push of a button in mere minutes, so they can function in mine sites either as the sole source of power or in sync with the grid.

Bottom line, going for the rental option will significantly reduce a mining project’s estimated capital cost and will cushion mining companies from the impact of making a huge non-core investment in this highly volatile mining market.

So, mines consume colossal amounts of electricity because of the number of energy-intensive functions that go into their operations. And, even as the industry faces risks relating to electricity supply and access to reliable energy sources, there are power generation technologies available, like temporary power plants, which can help mine operations sustain profitable levels of production.


Altaaqa Global
Tel: +971 56 1749505

Sources consulted:
“Why mines consume such large amount of electricity”. Zambian Mining Magazine. www.miningnewszambia.com. 16 October 2016.

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