Storage Innovations Open Up a New Era for Mines

These days, in conversations about energy for mines, storage is the name of the game. With renewable energy prices lower than they’ve ever been, the dream of a 100% renewable mine are becoming a reality, and storage is indispensable to such a project. At the same time, ongoing innovations in the storage sector have broadened the range of options available to mines. “The common misconception in the mining industry is that storage means batteries, but it’s much more than that, and the industry is moving quickly,” says Curtis VanWalleghem, CEO of Hydrostor.The following is a breakdown of the options available based on how and where they can be used.

SHORT TO MEDIUM DURATION: BATTERIES

The main way storage is currently used on mines is to optimize energy resources, by offsetting spinning reserves or achieving peak shavings. Both of these use cases require only a few hours of capacity, which is why batteries are the most prominent choice: easy to set up, they can provide anywhere from one to eight hours of stored energy for a large-scale user such as a mine, and their cost has reduced dramatically over recent years.

Lithium-ion is the best-known type of battery on the market, being the chemistry used in electric cars. The biggest advantage these batteries have is that the energy they store is very quick to be deployed, making it a great choice for offsetting spinning reserve.

Saturn Power is an energy storage provider that partnered with Hecate Energy and EllisDon Construction and Building Services to develop, engineer and procure Canada’s largest battery: a 40MWh device used by grid utility Festival Hydro in Stratford, Ontario. Adam Broadhurst, Business Developer in the company’s Energy Services department, says batteries can be particularly interesting in the context of safety on mining sites.

“There are a few things that miners always need to have running: communication and ventilation systems, as well as water pumping for example. They could put these battery systems on these applications and give themselves a couple of hours to keep running these systems if anything happens with the power,” he explains.

Lithium-ion battery providers are currently getting a lot of interest from miners in places where peak grid prices weigh a lot in global adjustment - Ontario being one of them. “Energy cost is the primary driver: global adjustment is C$500,000 to C$550,000 a MW/year, so every megawatt you can source from a different source, such as energy storage, during these peak times, you can take off of your bill. We then have an arrangement with customers to share that saving,” says Toby Titkinsky, Senior Vice President for Business Development at Convergent.

Regardless of which type of energy you initially store in the batteries, they can then be connected with renewable sources such as wind or solar, making them a good first investment for incremental greening of a mine’s power system. ABB, for example, has completed a project for an Australian mining company that uses energy storage as back-up to offset spinning reserves from a large gas turbine. “This one is quite important because it’s not around renewable energy, but around offsetting spinning reserves from gas turbines. It actually then enables future renewable energy to be connected because you already have the system to manage fluctuations much better,” explains Juergen Zimmerman Business Development and Technology Manager at the company.

ABB is now working on a project with SunSHIFT on an offgrid mine site, using a combination of renewables, solar forecasting and a battery system to remove the need for diesel generation during downtimes. “This mine’s goal is to be 100% renewable during day time, though it’s not viable to store energy for the whole operation of the mine at night time,” adds Zimmerman.

Lithium-ion batteries are a long-established technology, which tends to give miners some comfort. But they do present disadvantages: small capacity, degradation over time and low resistance to extreme temperatures - a deterrent for many remote mines.

NEW KIDS ON THE BLOCK: FLOW BATTERIES

Because of the limitations of lithium-ion batteries, other technologies have been developed, and flow batteries seem to be the most relevant solution to the mining sector. These can use different chemistries including iron and vanadium, but are water-based, and therefore non-flammable. “We only use three ingredients: iron, salt, and water,” says Hugh McDermott, Senior Vice President of Sales and Business Development at ESS Inc. “The fact that it’s only those three ingredients, no special sauce, extra ingredient, no catalyst, makes it hands down the safest, cleanest battery on the planet. The chemistry is non toxic, you could pour it on the ground, put your hand in it, no issue, no liability.”

With four to eight hours of power available, the battery can bring diesel savings of 25% to 40%, according to him. ESS Inc is currently working with a mine in Australia facing a number of challenges: “When the weather is good, you can take two days to get there from the main city, but when the weather is bad you can only fly there. Building a largescale storage facility is almost impossible there for two reasons: getting people and construction equipment there is difficult, and the 10-year mine life makes building and dismantling costs prohibitive.” For this project, ESS plans to string together several containerised flow batteries and put them on a road train for transportation. Once the system is plugged in, the company can used filtered local water to make it work.

On top of being safer and having more capacity than lithium-ion batteries, flow batteries are a lot more durable: McDermott says they can last almost five decades without degrading, even with several cycles a day. This means they could be moved to a different location at the end of the mine life.

“The multi-layered capability of the flow battery is more suited to be a proper back-up in remote regions,” says Vincent Algar, Managing Director of VSUN Energy (part of Australian Vanadium), which has installed vanadium flow batteries on universities and farms in Australia.

Flow batteries are facing an uphill battle in terms of competing with their better-known lithium-ion counterparts, but business is growing: from one battery installed two years ago, VSUN went to five in 2018, and expects more implementations in 2019.

One project allowed a farm in Australia to go 100% solar and stop using grid electricity completely. “Lithium-ion batteries are high maintenance because they heat up and have to be monitored all the time, there are fire risks, a fixed life. You could leave out a flow battery in the shed and it would just carry on doing its thing - that’s one of the stronger points about a flow battery, it’s a very robust machine,” Algar explains.

However, energy stored in flow batteries is slower to be deployed than with lithium-ion, making them less adapted for surge demand. At the end of the day, miners can create their own custom mix of battery storage to maximize efficiency. “There’s a sweet spot in terms of the optimal configuration. Certain chemistries can act bigger than what they actually are, so a 1MW lithium-ion battery might be that magic solution for a wind peak, while a flow battery might be better to store wind energy for longer in order to sell it at advantageous prices,” says McDermott.

LONG DURATION: COMPRESSED AIR

While short-term storage can bring significant energy savings to a mine, going 100% renewable will take a much more powerful solution. There aren’t many technologies out there that can store the energy required to maintain mining operations overnight or when the wind is down. Hydrogen solutions are being tested in some sites, including Raglan in Canada, but the technology remains extremely expensive, and many miners are still concerned with the flammable nature of the particle.

Another solution is standing out as a better match, at least for the medium term: compressed air storage. “We take air from the atmosphere and compress it, and then we store that air the same way you would in tanks for scuba-diving,” explains VanWalleghem at Hydrostor. “But we store so much it would need a building-sized tank, and the cost would be phenomenal. So we store it underground about 400m deep, and then we use water to keep it under pressure.”

Hydrostor has sold its solution to a grid power provider, but it required digging a shaft and carving out the space needed underground. With mines, there is no such need: the company can use existing void space carved while digging out ore, which reduced the cost of the system.

“You can store power for days,” VanWalleghem adds. “That’s really what’s needed if an off-grid mine is going to go 100% renewables. But we can also do that peak-shaving in the middle, around three or four hours - that’s where storage technologies kind of intersect.”

THINGS TO CONSIDER:

SOFT COSTS

Whatever the storage system, it’s important to plan for installation and interconnection costs, which vary greatly according to the location and grid provider. “That cost has nothing to do with the size of the system or storage asset. A 4MW system can be C$400,000 to C$500,000 in added cost just for the interconnection, when a 10MW can be C$100,000. The price is based on the utility, the state of the circuit and the individual utility’s approach to companies. So that’s been a challenge,” says Titkinsky at Convergent.

Depending on the system, there may also be the added cost of fire suppression equipment, safety corridors or ventilation: in Namibia, B2Gold recently decided the extra maintenance required for a lithium-ion battery made it cost-prohibitive on its Otjikoto solar farm.

LIFE OF MINE

This must be the number one concern for miners considering a storage installation on their site, which is why durability is key. “We are in talks with a couple of mines that have the goal of going 100% renewables, but the issue that we’re having with the mining sector is: what’s the mine life? What I find is that when they’re designing a new mine, they’re thinking all about the ore that they’re trying to get out, the business case and how they can support it from investors, so they don’t really like to try something out of the box at that stage. Then they operate the mine for a couple of years and realize how high the energy costs are but by then, they already have all the equipment in place and only have 15 years of mine life left, so that’s not enough time to recoup the storage and renewables spending. We haven’t really figured that out yet,” says VanWalleghem.

Hydrostor has a business case for mines that are closing down, by offering to lease their facility to store and sell power to grid operators, saving miners decommissioning costs. In a recent case, the company was able to use the site of a mine reaching end of life to store power for a new one being built right next to it - a lucky strike according to VanWalleghem.

For all the others, balancing out storage costs with life of mine remains a difficult exercise.

CONTRACT STRUCTURE

One way to deal with the life of mine challenge is to create a contract that removes installation costs - similar to a power purchase agreement (PPA). When VSUN installed its battery on the farm that went 100% solar, it did it through such an arrangement: “We charge the KWh they use at about 30% below the grid rate. I heard about a diesel provider supplying storage hardware to clients, with a power guarantee. If the power provider can see a benefit to buying a battery and redeploying it over four or five sites, then they can buy the equipment and run the power solution. That way, all there is is an operating cost.”

It is likely that independent power providers, including for renewables, will be the ones to take up the technology on broader scale and offer it to mines as part of their existing PPA - which would be a great way to remove capital costs for mines and ensure more implementation in the sector.

But for all the innovation displayed by the energy storage sector, there’s still a lack of visibility, especially for new technologies such as flow batteries or compressed air storage. 2019 should see a few new use cases, and many experts expect storage to become mainstream on mines from 2020 onwards.

“If you’re building a new mine today that’s not connected to the grid and plan to ship in diesel, you’re going to look like a caveman 20 or 30 years from now. I understand why that decision has been made for mines that are operating today, but when you’re planning a new mine, you’ve got to be thinking renewable energy and electrification of your mining equipment -- which means adopting storage,” concludes VanWalleghem.