A literature review on the potential of renewable electricity sources for mining operations in South Africa

Abstract

The economic situation of mining corporations operating in South Africa has in recent years created considerable challenges in staying globally competitive. One reason for this is the increase in average electricity costs from 7% to 20% of total operational expenses since 2007. Forecasts for the next decade predict that this development will continue at similar rates. The reliability of Eskom has also decreased, with self-generation being increasingly considered. In addition, the South African government plans to launch a carbon tax in 2016, which will further add to the costs of current electricity sources. This paper investigates the potential of renewable electricity sources for mining operations in South Africa. It is based on an extensive literature analysis, which was conducted in the form of a conceptual review. The investigation of electricity usage patterns reveals that mining operations commonly have a relatively constant day and night consumption. One of the prerequisites for a suitable source is its ability to supply electricity constantly. Most renewable sources can therefore only be used in hybrid versions, owing to relatively high intermittencies, especially with electricity supply from solar photovoltaic and wind generation. Nevertheless, the levelised costs are substantially lower than diesel generators and are already similar to Eskom tariffs, whilst also lowering carbon emissions. The business case of self-generation is shown to be positive. An on-site project can be realised through a power purchase agreement or through own investments.