Unfolding the potential of mining activities: Creating shared value by introducing decentralized renewable energy solutions

Abstract

The global mining sector, as well as many communities in developing countries are having one challenge in common: access to reliable, affordable and clean energy. While mining companies around the world are seeking to improve reliability and sustainability of their power supply, over 700 million people are without access to electricity (2019). Decentralized Renewable Energies (DRE) provide a solution to solve several issues at once: bringing down the costs of electricity while improving reliability and sustainability. This thesis investigates how DRE solutions can be applied cost efficiently in the mining sector and how these solutions can be shared with communities located nearby the mine. To do so, a qualitative analysis containing 9 expert interviews was conducted. It could be shown that the highest hurdles for executing such projects are resulting from the regulatory framework and geography. Further hurdles which were detected are of economic, educational and technical nature, which however, can be overcome (depending on the circumstances) by taking certain measures. Stakeholder management and financing are further aspects which have to be managed properly. It turned out that DRE deployment is very effective for mining companies, while sharing the infrastructure creates various risks, which hampers the execution of such projects. Sharing DRE in mining is not directly profitable for mining companies in most cases. However, it is still recommended to engage in energy sharing projects, as it can be a very good measure to achieve multiple (indirect) benefits for each party, such as electrification, decarbonization and an improved relationship to communities. The success of sharing projects is however limited by the circumstances of the area and the country. In most cases, it is recommended to develop two separate grids which are powering the mine and the community respectively.