Fine-tuning integrated microgrids for mines

Interview with Aggreko's Rod Saffy, Head of Mining

Renewable microgrids are becoming increasingly popular, as the cost of solar and wind energy continues to drop, and carbon reduction targets take more of a center stage for miners. For now, thermal power is still necessary for baseload and back-up, but its part in the hybrid energy mix can be reduced significantly through the smart integration of diesel or gas with renewables and energy storage.

Aggreko recently signed a 16-year contract to build, operate and maintain a hybrid power plant (thermal, solar, batteries) at Resolute’s Syama gold mine in Mali — the world’s largest offgrid hybrid power system, expected to save Resolute US$10mn in energy cost in the first year of operation.

Stage one is expected to be completed in 2020 and will comprise three 10 MW thermal Wärtsilä Modular Blocks and a 10 MW battery storage system, that will provide spinning reserve displacement and outbalance sudden jumps in load. The second stage will consist of the installation of an additional 10 MW Wärtsilä Modular Block in 2022 and the addition of 20 MW solar PV power in 2023. The project will reduce Resolute’s total cost of energy (TCOE) by 40% and their carbon emission by approximately 20%.

The project’s pricing was structured with a combination of fixed and variable charges and includes an incentive programme where Aggreko shares between 25% to 50% of the resulting fuel savings if improved efficiencies for key performances indicators in the contract are achieved. “This provides us with an incentive to further reduce the cost of power for Resolute, and we share that cost-benefit directly with our customer,” says Rod Saffy, Aggreko’s Head of Mining.

Granny Smith Mine

Additionally, the company is installing and operating Gold Fields’ Granny Smith gas, solar and battery solution in Western Australia. The 8 MW solar facility and 2 MW of battery storage is estimated to reduce Gold Fields’ fuel consumption by 10-13% and their carbon emissions by 11.6%.

Storage for diesel displacement

According to Saffy, almost all long-term power tenders now include an element of renewables. “Finding ways to integrate renewables into power generation is increasingly becoming a priority. Not only are renewables good for taking up and managing spinning reserve from a cost point of view, the reduction in emissions from using renewables is becoming an increasingly important reason for shifting,” he explains.

In the past year, Aggreko has seen an increase in the number of photovoltaic installations, as well as an increased interest in wind turbines for power generation and battery storage to help miners manage the spinning reserve component of their power load.

The growing trend towards renewables is gathering pace but thermal power still has an important role to play as a baseline power source in order to cope with demands when the sun is not shining or the wind is not blowing,” says Saffy. “At Aggreko, we are working with mining customers to give them the best renewable solutions to reduce their fossil fuel consumption. An example of this is the introduction of microgrid systems, which integrate battery energy storage with renewable generation, helping to avoid the intermittency of supply that can occur with renewable energy.”

For instance, the company has just supplied 1 MW of battery energy storage for spinning reserve for the Yamana’s Cerro Moro gold mine in Argentina. The battery has replaced one of the ten engines of the existing 10 MW diesel station already operated by Aggreko, under the same contract. “Displacing thermal generation with battery storage like we have done at the Cerro Moro gold mine is a repeatable and scalable solution and we are looking to expand this across our global mining business,” notes Saffy.

Digital element key to further renewables adoption

Of course, many challenges remain on the pathway to mine decarbonization. Projects with a short life of mine find it difficult to get a return on renewables. Restriction on real estate and the fact that significant amounts of work needs to be done on the land to ensure it meets environmental, social and government regulations are also potential barriers, according to Saffy.

But the environmental and reputational pressure felt by the mining sector will keep moving the needle in the right direction. Saffy predicts that the digital element involved in the dispatch and management of power generation will be increasingly important moving forward. “For example, we currently offer the ability to monitor the performance of a power station from a mobile phone and also control the power station remotely, making management of energy more accessible and measurable,” he says.

“At the same time, renewable solutions are here to stay and will form a bigger and bigger part of our product offering,” concludes Saffy.