Modern Mining July 2023

SUSTAINABLE MINING

The paradox of green metal demand and the Just Energy Transition By Spencer Eckstein – Director, Ukwazi Mining Studies

At COP26, in Glascow 2021, the USA and certain EU members promised to provide $8.5bn over five years to support South Africa’s Just Transition. That funding now seems in jeopardy owing to a potential decision by government to extend the life of certain coal powered stations and to relax air emis sions standards for some of Eskom’s power plants.

South Africa is uniquely poised to take advantage of the increased demand for green metals.

I n the EU, some members have backtracked on commitments to reduce their usage of fossil fuels (e.g. in September 2022, the German government passed legislation to extend the life of three of its major coal-fired power stations) as the energy crisis caused by the Russian/Ukrainian war deepens. In contrast, others have embraced renewables more completely; the ports of Rotterdam and Antwerp have done feasibility studies to assess the viability of operating off hydrogen. In 2022, 41% of the UK’s total energy mix came from renewables. Norway has indicated that its entire energy supply will be 100% from renewables by 2030, Denmark by 2040 and Sweden by 2050. Due to loadshedding, where Stage 6 seems to be the current dominant trend , mining companies with ESG considerations in mind, have been quick to embrace renewables. In June 2022, the Minerals Council South Africa said that the mining indus try had a pipeline of 73 projects, from 24 mining companies, to generate 5.1 GW (5,116 MW), valued at more than R65bn. Roughly one year later, the Auctus Metals report (May 2023) suggested that the renewable project pipeline in the private sector in

South Africa stood at around 13 000 MW. The gold sector, via Gold Fields and its renew able projects at South Deep, and the PGM sector, with players such as Anglo Platinum and Sibanye Stillwater, have been quick out of the starting blocks to focus on solar projects and the use of hydrogen for vehicles, green steel making, and power genera tion, amongst others. In contrast, vanadium players, such as Bushveld Minerals, have focused on processing vanadium oxides to supply battery materials, particularly to China. The coal sector for obvious reasons has been less excited about renewables. The usual refrain is that renewables cannot supply baseload power and are expensive. Experience and evidence from other countries suggests this is not the case. The exceptions in the coal sector have been Exxaro, which is transforming itself from a coal producer to an energy company, and Seriti, which has invested in a wind farm. The paradox of the quest for green metals and battery solutions, particularly for EVs and the transi tion to renewables such as solar, wind or hydrogen, is that it requires more mining and more commodities,

In the EU, some members have backtracked on commitments to reduce their usage of fossil fuels.

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26  MODERN MINING  July 2023