Modern Mining September 2020

South Africa’s electricity generation for the foresee- able future. The road to decarbonisation Decarbonisation is a wider global trend, which is also topical here in South Africa and the southern African region at large. What does this mean for the coal mining industry? Without a doubt, says Möncks, the CO 2 that is released during the burning of coal con- tributes to global warming. At the same time, there is also no doubt that electricity is paramount for the economy – and in the near term, viable large-scale alternatives to replace coal for electricity generation are not in sight. “While renewables (‘clean’ sources for electricity generation) will see an increasing share, and this is a long-term journey. Having said that, electricity gen- eration by coal will play a vital role, and so will the coal mining industry. This holds true for both domes- tic coal consumption as well as exports,” he says. As a consequence, adds Möncks, the demand for coal (and related production from South African mines) is seen as stable to only slightly declining in the medium term – but in the longer run, diligent considerations need to be made as there could be a sharper decline in coal demand. In any case, Möncks believes that mining compa- nies need to act directly on two dimensions: i) Ensure to reduce their own environmental footprint (scope 1 and scope 2 emissions). This can be done by complementing their own electricity consump- tion by self-generation from renewables, switching from diesel-operated trucks to fuel cell operated trucks – among several other levers. ii) Coal companies will face continued cost pressure. This is especially true once global seaborne coal

It is also worth mentioning that each direct coal mining employee typically provides for about seven to eight family members. This equates to the sub- stantial socio-economic role of coal mining. Coal mining is especially relevant in providing livelihood for people in the rural Mpumalanga province. Coal companies play a pivotal role in those fragile eco- systems,” says Möncks. Commenting on the electricity generation side of things, Möncks says coal provides about 90% of South Africa’s electricity – without a doubt, the entire economy across all sectors depends on this electricity supply. While efforts are being made to increase the share of renewables, Möncks believes that coal will continue to play a substantial role in

Coal miners need to drive innovation in their operations (technology being one lever) to improve their productivity.

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