Value from renewables in mine closures

Renewable energy mine

Leaving behind renewable energy systems for communities after a mine closes can produce valuable social benefits.

Mining companies usually implement renewable energy facilities to help decarbonise their operations, reduce energy costs, assist and support constructive obligations within communities, and aid their environmental, social and governance (ESG) ratings.

Miners typically focus on how a renewable-energy generation and/or storage facility affects project economics, and how to operate with sustainability in mind during a mine’s life.

In the past, mining companies mostly focused on production and reaching targets. But they are now seen to be working on how renewable energy assets at mines can leave a positive legacy for communities, particularly remote ones. This is a legacy that, for decades to come, improves energy security, creates jobs and opportunities, and helps the environment.

The synergies between renewable-powered mines and community development programs through the mine lifecycle and post-closure is the subject of an upcoming paper by SRK Consulting’s Ludovic Rollin, Jane Joughin and Danielle Kyan.

The paper is being presented at an Australasian Institute of Mining and Metallurgy (AusIMM) Life of Mine 2023 conference in Brisbane in early August.

“Thinking bigger with renewable-powered mines is also about thinking better,” Rollin, a senior environmental engineer with SRK Consulting, said.

“Mining companies should be open-minded with emerging renewable technologies and consider if they can create a positive social impact on communities long after a mine closes.”

SRK principal environmental geologist Danielle Kyan said mining companies were beginning to focus on the alignment of renewable-powered mines and community development.

“The starting point for many mining companies has been to introduce renewable energy sources and storage on-site to lower their carbon footprint,” Kyan said. “Often, the next step is to introduce electric vehicles to further reduce carbon emissions.”

The opportunity, according to Kyan, is integrating renewable energy thinking into mine planning and closure strategies – and into community-engagement programs.

“Renewable energy assets can potentially change the conversation between some mining projects and nearby communities,” she said.

“Mining companies that engage with communities to understand their long-term needs – and develop renewable assets that respond to those needs – are likely to gain greater support from stakeholders.”

Rollin believes community needs from renewable assets can be broader than energy.

“It could be about water quality, food supply or ensuring there are jobs after a mine closes,” he said.

Complex challenges

The main issues occur when mining companies seek to introduce renewable power at existing or new mines as part of their decarbonisation strategies. This can involve sourcing renewable energy from external sources or establishing power generation and storage facilities at the site.

Using solar panels or wind farms to generate power on-site, or establishing batteries, hydrogen facilities or pumped hydroelectricity to store energy, is complex. This often requires land access, impact assessment, planning, environmental approvals and significant community engagement over months or years.

Transitioning to renewables also raises new challenges in energy supply variabilities, land and skilled labour requirements, and in meeting mine-closure objectives.

Although renewable energy systems in mining have great potential, many Australian mines are in remote areas near sparse populations and have limited scope to leave a renewable-energy legacy. This means the likeliest outcome is to demolish these assets when the mine closes.

“In many locations, the introduction of renewable energy is focused on the mine’s energy needs and carbon intensity during its lifetime,” Kyan said. “Potential for leaving an energy legacy when the mine closes becomes more difficult when the benefits are too low.”

Rollin said mining companies can address these and other challenges through participative stakeholder engagement.

“The goal should be to identify whether the introduction of renewable energy technology at a mine can help a nearby community and if it’s feasible for that asset to continue operating after the mine closes,” he said.

Choosing the right time is vital.

“A mining company might think 20 years ahead when factoring renewable energy into its planning and closure strategies,” Rollin said. “But with appropriate maintenance and operational support, that asset might power a community for the next 50–100 years and provide other social benefits.”

The longevity of renewable energy assets raises other issues.

“If there is an identified long-term benefit, mining companies and communities need to work together to understand how that renewables asset would be maintained, who would own it, and who is responsible for its ongoing costs and any potential liabilities, after mine closure,” Kyan said.

In some cases, this collaboration will extend beyond the mining company and communities.

“In areas where there are multiple mines and other industries, there is a potential for mining companies, industries and government to work together and form renewable-energy hubs,” Kyan said.

mine closure
Using sources like solar panels to generate power on-site is complex.

New technologies

Rollin believes mining companies should consider a wide range of established and emerging renewable technologies – and communicate their features, benefits and risks to communities and other stakeholders.

Examples include agrivoltaics and aquavoltaics – the simultaneous use of areas for photovoltaic solar generation with agriculture or aquaculture, respectively.

Another emerging option is “solar grazing”, a method of vegetation control on a solar farm using sheep or other livestock grazing. So too are mobile water desalination plants that enhance the use of surplus power and provide isolated communities with fresh water.

“The key is to understand what the community needs and the renewable energy technologies best placed to address that need and the mine’s goals,” Rollin said. “Then to understand the feasibility of the preferred technology and model it in mine planning and closure.”

Project economics can change when companies incorporate the longer-term social benefits of renewable-energy assets.

“In addition to financial and decarbonisation considerations, companies need to ask, ‘What are the other benefits of incorporating renewable energy and storage on-site and leaving those assets as a legacy for communities after closure, and how do we value them?’”

Rollin added some questions of his own.

“How could the implementation of renewables and the engagement that accompanies them aid project approval? How could renewables build stakeholder support in financial markets and lower the company’s cost of capital? What does leaving a positive legacy for a community through renewables do for our company’s reputation and social licence to operate?” he said.

Rollin reiterates the need to “think big” on renewables.

“When mining companies expand their thinking on renewables to a multi-decade focus, to a wider range of technologies, and to sustainable social benefit for communities, new opportunities to create value start to emerge,” he said. “That won’t be the case for every project, but mining companies should ask these questions early in the planning process.”

Tips for alignment between renewable-powered mines and community programs

Follow latest developments: Trends in renewable energy – and their application to mining – are moving quickly. Understand how the mining industry is adapting to renewables and the options available. Review case studies here and overseas.

Seek specialist advice: Ensure your organisation has access to high-quality advice. This is a highly specialised field that requires local and international expertise with renewable projects in mining.

Embed renewables into planning processes: The use of renewables should be an early and recurring consideration in mine planning and closure strategies.

Be open-minded: New renewable-power generation and storage technologies continue to emerge. These innovations are increasing the potential to leave legacy renewable assets that benefit communities long after mine closure.

Think longer term: Do not only focus on the impact of renewables during the mine life. Consider the full life of a renewable-energy asset and whether it could help a community for decades to come.

Consider non-financial value: Legacy renewable assets can strengthen community engagement, corporate reputation and social licence to operate. If these social benefits have value for your organisation, include them in project modelling.

Participative engagement: Renewables require a different form of engagement that is about understanding community needs, explaining the specific technology and working with stakeholders to identify mutually beneficial outcomes from renewables.

Collaborate widely: A renewable project could involve collaboration with other companies in the area to create a clean-energy hub; working with federal, state and local governments; or engaging with stakeholders such as institutional investors or financiers to communicate the company’s renewable strategy.

Identify government support: Understand funding programs available to support the development of renewables projects in your location; whether your project is a potential candidate; and the requirements to secure a grant.

Share lessons: Be prepared to share your organisation’s experience with renewables, its engagement processes and how communities benefited from it. The concept of leaving a legacy renewable asset for communities after mine closure has great promise, but is still in its infancy.

This feature originally appeared in the August 2023 issue of Australian Mining.

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