Slide 1: Here Comes the Sun: How mines can utilise Renewable Energy
Here Comes the Sun: How mines can utilise Renewable Energy Gold Fields, Rocky Mountain Institute and Carbon War Room Thursday 15th September 2016
Slide 2: Introduction
Introduction ICMM background Supporting the transition to a low carbon economy through efficiency and low carbon technology Introducing • Dr Tsakani Mthombeni, Group Head of Carbon and Energy at Gold Fields • Alastaire Dick, Operations Lead for Sunshine for Mines at the Carbon War Room • Thomas Koch
Slide 3: Sunshine for Mines: Gold Fields South Deep, and Beyond
Sunshine for Mines: Gold Fields South Deep, and Beyond Tsakani Mthombeni, Alastaire Dick, Thomas Koch Blank ICMM Webinar 15 September 2016
Slide 4: RMI-CWR: Our Joint Missions
5 RMI-CWR: Our Joint Missions We accelerate the adoption of business solutions that reduce carbon emissions at gigaton scale and advance the low- carbon economy. We transform global energy use to create a clean, prosperous, and secure low-carbon future. A GLOBAL NON-PROFIT, FOCUSED ON PROFIT
Slide 5: Sunshine for Mines Initiative
6 Sunshine for Mines Initiative Sunshine for Mines seeks to rapidly accelerate the penetration of cost- effective renewables into the mining sector globally—reaching an industry-wide penetration of 15% by 2025, with adopting mines generating 35%+ of their energy from renewables.
Slide 6: Renewables in Mining: Business Case
7 Renewables in Mining: Business Case Five trends make for a strong business case today High Energy-Intensity of Mining Globally Increasing Energy Security Concerns Falling Costs of Renewables; Rising Costs of Fossil Fuels Opportunity for Shared Value & Community Development Firm-wide Sustainability
Slide 7: Barriers to Renewables Adoption
8 Barriers to Renewables Adoption Lack of awareness of renewables opportunity LACK OF Lack of data on costs vs. savings (case studies) INFORMATION Mining firm / Renewable developer gap Mining culture, C-Suite / Site management gap LACK OF Operational mindset and governance DEMAND PULL La
Slide 8: Barriers to Renewables Adoption: External barriers
9 Barriers to Renewables Adoption To what extent do you Not ready Internal barriers perceive that the Ready challenge is internal vs Blocked by internal barriers external? • Concept reliability • Life of mine uncertainty • Opportunity awareness Deal ready External barriers For how large share of
Slide 9: Background to South Deep Mine
12 Background to South Deep Mine • Grid connected (Eskom), 95% of electricity from coal • Energy spend is 13% of operating spend (Group 21%) • Average load 55 MW, to peak at 75 MW • Life of Mine: +70 years • Global Horizontal Index (GHI) of 2 061 kWh/m2
Slide 10: Gold Fields commitment to renewable energy
13 Gold Fields commitment to renewable energy Supported by Top Management and an Enabling Environment Supported by Board and Group ExCo Strong and visible CEO Commitment Integrated Group Energy and Carbon Strategy Entrenched through our Group Energy & Carbon Policy and Guideline Included in Group Ba
Slide 11: Gold Fields commitment to renewable energy
14 Gold Fields commitment to renewable energy What Gold Fields is focused on Group BSC illustrates integrated thinking CEO, Executive and Senior Management remuneration is linked to the deliverables
Slide 12: Gold Fields visible commitments to RE and EE
15 Gold Fields visible commitments to RE Strategic renewable energy and efficiency commitments and EE • Aiming for 20% renewable energy generation on average in all new mine developments • Set 3-year regional carbon emission and energy efficiency targets to 2016 & revised 2020 targets • Over US$50m
Slide 13: Gold Fields and CWR-RMI collaboration
16 Gold Fields and CWR-RMI collaboration Why did Gold Fields choose to work with CWR-RMI? • Global leader in business solutions to reduce carbon emissions & advance a low-carbon economy • CWR-RMI mission is aligned with our vision • We share the goal of supporting industry-wide change • CWR-RMI has
Slide 14: Process step by step – Gold Fields
17 Process step by step – Gold Fields A. Portfolio-wide B. Techno-economic C. Vendor Selection & D. Project Energy Security Study & Solution PPA Advisory Development Advisory Review Design Reviewed existing Analysis of site— EOI sent to 75 IPPs Initial joint project “Regional Security of loa
Slide 15: Gold Fields Partnership – Process
18 Gold Fields Partnership – Process A. Energy Security Review Review Regional Assess Energy Determine Key “Security of Risks and Renewable Supply” Plans Mitigation Options Opportunities B. Techno-Economic Study Collect Data and Evaluate and Conduct Analysis Determine Baseline Prioritize the and Det
Slide 16: C. Outcomes of Procurement Process
21 C. Outcomes of Procurement Process Expression of Interest sent to some 75 players 28 positive responses entered Request for Proposals stage 10 proposals submitted Certain proposals claim to meet grid-price parity today & most trend favorably with inflation over the PPA term Energy storage technol
Slide 17: Banking a Captive PPA
22 Banking a Captive PPA Considerations to Determine Economic & Technical Feasibility Prevailing and Geography (Land PPA Price Life of Mine Future Grid & RE Potential) Expectations Energy Tariffs Resource Load Profile Betting on Future IFRS Accounting intermittency ≠ Influences the Grid Instability
Slide 18: Lessons Learned and how to tackle the Barriers
23 Lessons Learned and how to tackle the Barriers LACK OF INFORMATION Create a proof point for cost effectiveness LACK OF DEMAND PULL Use the Gold Fields case to inspire others CAPITAL & RISK Establish a standardized process and approach COMPLEXITY Simplify through standardization * REIPPP:
Slide 19: The Immediate Journey Ahead
24 The Immediate Journey Ahead CWR-RMI aims to repeat the experience of Gold Fields with additional firms – We will expand our suite of services, to look at opportunities not only for integrating renewables onto off-grid mine sites or sites faced with grid instability, but also for mines exploring c
Slide 20: Discussion
25 Discussion Not ready Internal barriers Ready Reporting standards What type of initiatives would help Readiness you to overcome internal and barometer External barriers external barriers? Standardized Information What can ICMM, Sunshine for approaches sharing platform Mines and potentially oth
Slide 21: Thank you
Thank you www.carbonwarroom.com Contact: Tsakani Mthombeni, Group Contact: Alastaire Dick, Operations Lead, Head of Energy and Carbon Sunshine for Mines Email: alastaire@carbonwarroom.com tsakani.mthombeni@goldfields.com
Slide 22: International Council on Mining and Metals (ICMM)
International Council on Mining and Metals (ICMM) 35/38 Portman Square London W1H 6LR United Kingdom Switchboard: +44 (0) 20 7467 5070 Main Fax: +44 (0) 20 7467 5071 E-mail: info@icmm.com www.icmm.com