Challenged by frequent power supply disruptions and anticipated price increases South African mining company Gold Fields undertook a regional energy security plan in cooperation with the Carbon War Room Sunshine for Mines Project. One of the first outcomes of this review is an RFP for a 40 MW solar PV project for its South Deep Mine. In this interview Duncan Stevens, Gold Fields VP pf Group Sustainable Development, gives an update on this project, the RFP and Gold Fields forward looking energy strategy.
Renewables are a Key Consideration for our Future Energy Supply Mix at South Deep: Gold Fields Interview
“There is a much stronger convergence between mining and renewables in South Africa now than ever before and we are also seeing this in in other parts of the world,” says Duncan Stevens, Vice President, Group Sustainable Development at Gold Fields. Our South Deep Mine in South Africa recently published an expression of interest for a 40 MW solar PV project, which has now moved into the Request for Proposal (RFP) stage. “Given the rising costs of electricity and supply shortages in South Africa we see renewables as a key part of the energy mix at South Deep especially given that the life of mine is greater than 70 years,” adds Stevens.
Gold Fields has continued exploring renewables integration as part of the development of its five-year regional energy security plans in 2015 for all of its operations around the world. Working in collaboration with Rocky Mountain Institute and Carbon War Room (RMI-CWR) through the joint organization’s Sunshine for Mines initiative, Gold Fields identified the opportunity for a possible PV project at South Deep resulting in the recent RFP. The company also remains committed to 20% renewable energy generation (on average) in all new mine developments.
Q: Can you fill us in on the work you have been doing with the RMI-CWR’s Sunshine for Mines Initiative to identify the business case for renewables and which led to the RFP for the South Deep PV project?
A: In South Africa, we have been experiencing more frequent power supply disruptions (even though this has not currently affected our production) and we also anticipate that prices will continue to rise in the long-term. This presented an opportunity to examine the use of renewables more seriously. After meeting with a representative of Carbon War Room at the Energy and Mines Summit in Johannesburg in June 2014, we realized we shared a common vision to advance the transition towards a low-carbon economy. When we commenced the review of our five-year regional energy security plans we invited the RMI-CWR, through Sunshine for Mines, to undertake a third party review of the business case for renewables. (watch video of Gold Fields / CWR presentation at Energy and Mines Johannesburg Summit, July 2015 – click here)
We considered a number of renewable energy options, together with the CWR/RMI, for South Deep Mine but due to some of the limitations of wind power and sourcing materials for biofuel stocks, solar emerged as the most viable option.
Q: What are some of the things you learned through this evaluation process that has helped inform your understanding of the applicability and economics of renewables for your sites?
A: For us, the process was really about getting a better understanding of the type of renewable energy that is most appropriate for South Deep, with solar PV emerging as the most likely and cost effective option at this stage. Some of the things we learnt through the evaluation process is that there is a growing interest in renewables in the South African mining sector, which is mirrored globally. The South African governments Renewable Energy Independent Power Producer Procurement Programme (REIPPPP), has also stimulated the solar technology industry, creating economies of scale. A number of domestic providers have been bolstering their capacity for solar power and some of the major international providers have been expanding their footprint in South Africa.
Battery storage is still expensive and we are hoping that with time, increased innovation and economies of scale, this crucial component of the solar equation will become more economically viable.
Good partnerships are important and our collaboration with RMI-CWR and the organization’s Sunshine for Mines initiative has been a positive and enriching learning experience for both parties.
Q: What has the response been to your RFP so far and what do you anticipate in terms of the timeline for evaluating these proposals?
A: We put out an Expression of Interest to around 75 suppliers; of these around 30 suppliers indicated they will participate in the RFP. We expect to receive full proposals by the end of December 2015 and will be evaluating them in January 2016.
Q: Can you share some of the next steps in your collaboration with RMI-CWR’s Sunshine for Mines initiative and building your global energy strategy?
A: Firstly, we will be looking at the key learnings coming out of this process and how we can integrate those into future RFP evaluation processes in Gold Fields as well as the evaluation of other renewables opportunities in the group.
For the South Deep Solar PV RFP, the CWR-RMI’s Sunshine for Mines team will be working with our technical team on the initial evaluation of the proposals received.
Q: What are you looking forward to at the Energy and Mines London Summit in January?
A: I always look forward to hearing the fascinating presentations showcasing new strategies, leading practices and projects. The networking opportunities are also valuable as one doesn’t often get the chance to interact with such a diverse array of renewable energy stakeholders from financiers to academics, energy providers, the regulator and peer mining companies. I always come away with ideas and learnings that we can apply at Gold Fields as well as having an opportunity to add to the very important agenda of renewables in mining.
Stevens will co-present, together with Jules Kortenhorst (CEO of RMI-CWR) on the outcome of the South Deep PV project RFP on January 28th at the Energy and Mines London Summit. There he will be joined by other senior mining leaders and renewables experts for two-days of networking and knowledge-sharing. Carbon War Room (RMI-CWR) is also hosting a half-day workshop with senior mining and renewables experts in association with this event. This week, Stevens provides insight into the evaluation process that led to the RFP and the next steps for Gold Fields’ energy strategy.