Why effective, digital carbon accounting is critical in achieving decarbonisation for the mining sector
Mining and resources organisations are under pressure both to decrease their emissions and increase the accuracy and depth of their environmental, social and governance (ESG) reporting.
As the sector moves towards net zero emissions by 2050, demand for digital solutions that enable organisations to track, analyse and act upon their emissions is increasing rapidly. We spoke recently with John Vagenas FAusIMM, Managing Director of Metallurgical Systems, about why we need to measure emissions, what we need to be measuring, and how organisations can do so transparently and accurately.
Why do mining and resources organisations need to measure emissions?
As the world moves towards achieving net zero emissions in the next 30 years, organisations of all sizes across all industries are under increasing pressure to track, analyse and reduce their footprint. In June this year, the Australian Government reaffirmed Australia’s commitment to net zero emissions by 2050, and also committed Australia to more ambitious targets by 2030. This puts industries like mining and resources, responsible for around four to seven per cent of the world’s greenhouse gas emissions (McKinsey, 2020), under particularly intense pressure.
While some organisations in our sector are making great progress in this area, it’s going to get increasingly difficult for those who are behind on their digital transformation execution. Failure to measure emissions effectively has the potential to affect an organisation’s reputation, ability to secure funding and investment, capacity to attract and retain skilled workers, and largely their overall operating productivity and profit.
What do you see as the main barrier to effective measurement and reduction?
The main problem we see at Metallurgical Systems is that organisations simply don’t have the right technology in place. If you can’t measure and report transparently on your operations at a granular level, then there is no baseline from which to accurately calculate the reduction in emissions. Unless you can calculate emissions reductions, it’s impossible to evaluate the most effective decarbonisation strategies, which could include changing processes or implementing new green technologies.
Often, reporting is still done manually using office spreadsheets and assumptions, or sporadically by third-party consultants who are not technical engineers or metallurgists. This is a major barrier for our sector.
What do organisations need to measure?
There are two aspects. First, there’s the information that organisations are legally obligated to report according to the jurisdiction in which they operate. Organisations generally need to report on Scope 1, Scope 2 and Scope 3 emissions as outlined by the GHG Protocol. Many are also required to show year-on-year improvement.
Second, there’s the information that can help an organisation determine how to reduce its carbon footprint and operate more sustainably. To effectively reduce waste, improve yield and implement new, green processes, organisations must first understand exactly where emissions are occurring at every step of the production process, and how things can be improved.
Currently, the mining sector is highly dependent on traditional energy sources, and the main source of GHG emissions for mining and minerals is energy consumption. Decreasing ore grades and increasing strip ratios, as well as growing demand for larger quantities of metal concentrate, are driving a greater reliance on energy, and highlighting the need for more sustainable energy sources.
It’s important to remember that the GHG emissions associated with individual mining and minerals processing operations are highly variable due to site-specific differences. An organisation’s level of emissions can depend on its ore mineralogy and grade, the type of mining used to extract the ore, and the processes used to refine the ore. The geographical location of the site must be considered. Some sites are so remote that access to the grid or the supply of gas is unattainable, leading sites to use diesel fuel or heavy fuel oil (HFO) as their fuel source for power.
How do we achieve decarbonisation with technology?
Achieving better ESG outcomes, especially when it comes to measuring emissions and consumption, is all about having the most current technology designed specifically for the minerals processing industry. With the right metallurgical accounting and process optimisation solution, it’s possible to track, report, manage and reduce a plant’s emissions – as well as its power and water consumption – in granular detail. The right digital solution has the potential to support organisations with their ESG in four key areas: ensuring energy efficiency, improving yield, reducing greenhouse gas emissions, and driving new, green processes.
The right technology should also enable organisations to access all necessary information via dynamic dashboards, and to test and trial scenarios. Without technology that can collate all the information for testing, it is impossible to measure emissions in granular detail accurately, transparently and consistently year-on-year. It’s also more difficult to identify and test ways in which the organisation can improve its ESG performance or implement ‘green’ solutions.
What else do we need to consider for effective decarbonisation?
As mining and minerals processing is an energy-intensive industry, we also need to focus closely on the source of the energy we are using. We need cheap, reliable power that minimises emissions. This is particularly the case if Australia is to grow our local manufacturing capacity with more downstream processing – generating more local jobs, and reducing reliance on offshore processing. To ensure Australia isn’t just the world’s quarry, but a competitive global leader in both the extraction of raw materials and their complete processing, we need to implement proven, sustainable, reliable, and economical power sources.
What other factors do organisations need to consider?
It‘s worth noting that digital tools are effective only if they’re deployed by experienced professionals with skills to analyse and understand the data. There are qualitative and quantitative factors at play in ESG performance. However, with a sophisticated digital twin solution in place, qualified professionals can determine more accurately how and where to make improvements.
If you want to find out more about Metallurgical Systems and how their technology and expert support can enable effective ESG measurement, you can visit their website here.
You can also hear John Vagenas speaking on technology and decarbonisation as part of AusIMM's Thought Leadership Series, available as an on demand webinar here.