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A concept illustration of a future all-electric, “emission-free” quarry.
A concept illustration of a future all-electric, “emission-free” quarry.

Survey reveals challenges of an electric-dependent future

A new survey has revealed that the effective electrification of the extractive sector would require a reskilled workforce but could benefit from non-competitive attitudes amongst operators and equipment manufacturers.

The findings were among four key themes to emerge from the survey commissioned by professional services firm Ernst & Young (EY), which sought to establish the opportunities and challenges in establishing an electricity-dependent resources sector.

The University of Queensland’s Sustainable Minerals Institute and The Norman B Keevil Institute of Mining Engineering at The University of British Columbia in Canada conducted the survey. It involved extensive interviews with mining companies, employees and original equipment manufacturers (OEMs) from across the globe, including Australia, Canada, New Guinea, the US, Russia, Peru and the UK.

“The mining sector is on the verge of an electrification revolution, driven by significant cost reduction potential, lowered carbon emissions and improved worker health benefits,” EY global mining and metals leader Paul Mitchell said.

“This is critically important, given the World Health Organisation has declared that diesel particulates now belong in the same deadly category as asbestos, arsenic and mustard gas.”

Electrification had emerged as a top priority for mining companies, according to the survey, which was being driven by cost reduction, energy efficiency and licence-to-operate stewardship.

In order to develop better electrification solutions, survey respondents believed OEMs, operators and governments would need to form stronger partnerships, and even consider collaborating in a non-competitive fashion.

It is thought data collection will be critical to industry electrification. However, the survey highlighted concerns such as intellectual property, competitive advantage or perceived loss of data monetisation-related opportunities have created protectionist attitudes from operators, suppliers and OEMs.

“I don’t believe that companies or OEMs need to develop the technology independently,” one survey participant said. “I believe a lot of these technologies will be commodity technology at the end of the day, so none of this should be proprietary or be seen as competitive advantage.”

Reducing emissions and costs

The survey also identified that energy costs represented up to a third of the total operational cost base, making it a closely managed component of operations. This coincides with an era in which there is increasing demand on operators for carbon emission reduction.

“Electrification is one way to achieve this. Diesel engines cannot be replaced with carbon-generating electricity and therefore electrification needs to be accompanied with a move to renewable power,” an analysis of the survey results concluded.

“Electrification reduces not only operational costs, but also up-front capital costs ... More significantly, the reduction of diesel particulates results in improvement to worker health and safety.”

According to the survey, electrification would require a reskilled workforce due to advanced technologies requiring less maintenance and human intervention. Recent research from EY and the Minerals Council of Australia suggests 77 per cent of jobs in the sector will be enhanced or redesigned due to technology in the near future.

“Analysis of the survey findings reveals there will be increasing demand for data and digital literacy skills across all phases of the mining value chain, as the human-to-machine interface evolves and becomes more prevalent.

“In developing economies, this means challenging the assumption that a mine provides employment only for people doing physical labour.”

Mitchell said it was important the sector considered building agility into site design to leverage the potential benefits.

“The future of electrification in mines requires a paradigm shift in thinking – from existing known and proven technologies to new emerging technologies,” he said. “We must realise that the challenges of the sector can be solved faster by collaboration – and a robust strategy, underpinned by gaining the right capabilities and an agile approach, is critical.”

Further information about the survey can be found on the EY website.

 

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