Fleet Decarbonisation in the mining industry: changing the game to reduce carbon footprint

Introduction

Around the globe, a movement is forming and gaining steam: to make the Earth a greener and sustainable place with net-zero carbon emission. This emerges from the brutal fact that humans are altering Earth’s habitats at an alarming rate to the point that the 35th International Geological Congress in 2016 designated Anthropocene as an official geological epoch. António Guterres, United Nations (UN) Secretary-General, declared decarbonisation as the world’s most urgent mission, citing the recent records on temperature rising, Arctic sea ice disappearing, biodiversity collapsing and ocean warming.

The world is reacting quickly on different fronts, and the discussions happening at the Glasgow Climate Change Conference (COP 26) are a powerful example of the worldwide commitment towards net-zero emissions.

In this Insight, we will discuss how the mining industry is acting to reduce its carbon footprint through fleet decarbonisation using new technologies and advanced analytics approaches. Before we go deeper into the topic, let's contextualise two important scenarios: politics and economics, and the green movement in mining.

Politics

Nations and politicians are showing their strong commitments. At the UN level, the Paris Agreement, negotiated by 196 state parties and, as of July 2021, signed by 191, sets the goal of reaching net-zero carbon dioxide emissions by 2050 to keep the mean global temperature rise to well below 2°C above pre-industrial levels. In the United States, the Green New Deal, which has been gaining popularity, proposes ambitious goals to replace fossil fuels with renewable energy. Europe has its similar version, called the European Green Deal, in a quest to make Europe the first climate-neutral continent.

Economics

Decarbonisation requires significant capital investment to build new carbon-zero energy sources, build distribution infrastructure, and adapt or replace existing fossil fuel-based equipment. In the short term, impacts on local economies are mixed as jobs gained from investment projects are offset by higher energy costs. In the long term, most studies agree that decarbonisation will bring on a net gain of jobs and GDP growth.

Green Movement in Mining

Following a cross-industry trend, the mining industry also started to act on the same concerns from regulators, investors, customers and the community. Currently, sustainability and decarbonisation have become one of the top priorities of mining CEOs. Most global miners have publicly declared their commitment to net-zero carbon emissions by 2050, with some exceptions setting a more ambitious target of 2030.

Three categories of Greenhouse Gas (GHG) Protocol emissions and corresponding examples in the mining industry:

• Scope 1: direct emissions from owned or controlled sources
  
  • Burning of diesel fuel in trucks
    
  • Fugitive emissions, such as methane emissions from coal mines
    
• Scope 2: indirect emissions from the generation of purchased energy
  
  • Mining facilities running on electricity produced by coal-based power stations
    
• Scope 3: all other indirect emissions in the value chain of the reporting company
  
  • Emissions by consumers of mining products, such as steel makers burning thermal coal
    

Of the three, Scopes 1 and 2 emissions are largely within the control of mining companies, particularly their diesel-powered mobile mining equipment which accounts for 30% of GHG emissions of the entire sector. This is therefore an appealing area to tackle and the focus of this article: fleet decarbonisation.

Fleet Decarbonisation

Mining companies have set goals in investment and a reduction in GHG emissions in the next decades. BHP, Rio Tinto and Vale have established a 30% reduction in Scope 1 and 2 of GHG by 2030. To achieve this number many actions must take place, with fleet decarbonisation being one of them.

Replacing diesel utilised in transport is one of the key points considered for the 2030 target, given the high contribution in Scope 1 emissions. Nevertheless, replacing the fleet with electric consumption would also increase Scope 2 emissions; thus the goal is not the overhaul of the fleet per se, but the decarbonisation measures. Not only do companies have to plan electrification, but also how to increase low-emission sources for electricity. Besides electrification, hydrogen is a potential candidate and a primary interest of some mining companies, such as Anglo American. Similar to electrification, finding low-emission sources for hydrogen is one of the key challenges.

Mining companies are planning to reduce diesel consumption with alternatives like conveyors, optimising transportation routes, trolley assists, etc. Vale already implemented a pilot in route optimisation tested with 50 trucks and reported a reduction of 1.5 tCO2. Most mining companies consider the diesel displacement plan in phases, given the project's high risk and high capital requirements. This flexibility allows more alternatives to be tested and rapid development with new technologies.

Many countries are also establishing carbon neutrality goals. The European Union, China, Japan and South Korea have targets ranging from 2050–2060. China, one of the biggest iron markets, is already reducing steel production in companies with low environmental performance.

The time horizon for mining companies also ranges in the next few decades, considering these countries account for most of their sales.

Complete decarbonisation is not a simple task but one that is being planned gradually as we go.

What do mines and communities get from it?

Mining exploration heavily affects nearby communities, with some sites being as big as small cities. Thus, this big change in fleet would also influence the mine areas. More infrastructure for ore processing on site, such as in-pit crush and convey, reduces transport needs. Other changes such as conveyor belts and trolley assists could also be widely implemented, reshaping mine layouts.

In order to have renewable electricity for fleets, most mining companies are investing in solar and wind energy. This reduces Scope 2 emissions and could supply community demand as well. For example, Rio Tinto is implementing new structures in Fort Dauphin, Madagascar, supplying clean energy for operations and nearby communities. While many impacts are predictions, test sites are already showing results.

Challenges

The currently most viable option for decarbonising fleets consists of battery-operated vehicles. However, this option brings challenges:

1. The site's power load will be heavily impacted and will need balancing.
   
2. Bigger dependency on reliable and affordable sources of electricity.
   
3. The exact increase in electricity consumption is hard to define.
   
4. For now, storing more than a couple of hours of energy in batteries is still prohibitively expensive.
   
5. Mining companies cannot do it alone. They need OEMs and battery providers willing to partner. Newmont Goldcorp, for example, is still “lacking a major battery provider”.
   
6. If the miner is grid-connected, greening the grid requires collaboration with governments, power suppliers and industries.
   

Some examples of decarbonisation in mining

• The world’s first carbon-neutral open-pit mine is being built by Nouveau Monde Graphite, powered by hydropower with support from the Quebec government.
  
• GoldCorp’s Borden underground mine reduced power use by 40% after fleet electrification, mainly due to reduced ventilation needs. However, in general, electricity demand rises overall.
  
• Glencore Plc committed to a Paris-consistent strategy and a 30% reduction in emissions by 2035, while investing in energy transition materials and carbon capture projects.
  
• Vale SA announced a $2 billion investment to reduce emissions by 33% by 2030, with an internal carbon pricing mechanism of $50/tCO2e.
  
• Rio Tinto is installing a 34-MW solar farm at Gudai-Darri, expected to cut 90,000 tonnes of CO2 annually—equivalent to taking 28,000 cars off the road.
  
• Anglo American’s Mogalakwena mine in South Africa is piloting hydrogen-powered haul trucks with a 3.5 MW electrolyser on site.
  

Return on investment

The exact ROI of fleet decarbonisation is unclear, given the many variables involved. However, sustainability is increasingly a priority for capital markets. Miners with lower ESG scores can face capital costs 20–25% higher. Customers also apply increasing pressure, and sustainability can serve as a market differentiator.

Advanced analytics approaches

To achieve decarbonisation goals sustainably and reliably, companies apply different advanced analytics approaches:

• Simulation Models: replicate mine sites digitally to test scenarios, measure requirements and assess feasibility.
  
  
• Optimisation: use linear optimisation to determine cost-efficient ways of adding new technology or infrastructure.
  
  
• Data Science: leverage current and historical data to forecast electricity demand, manage renewable integration, and identify inefficiencies.
  

Conclusion

Decarbonisation is both a challenge and an opportunity for mining companies. Obstacles such as technology gaps, capital requirements, policy pressures, and stakeholder expectations exist. Yet, if executed properly, decarbonisation will become a critical competitive advantage, reshaping the mining industry as we know it.

About the Authors

• Luan Mai – Visagio consultant, PhD in Mine Planning Optimisation, expert in optimisation, simulation, and data science.
  

• Eduardo Possato – Management Consultant, experienced in data analytics, digital transformation, and business development.
  

• Danilo Saito – Technology Consultant, specialised in RPA, ETL, cloud computing, and process mapping.
  

• Victor Drummond – Management Consultant, experienced in innovation, process mapping, and change management.
  

• Kung Yan Toong – Management Consultant, with expertise in data analytics, process automation, and optimisation.

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