Home' Australian Resources and Investment : March 2016 Contents 20 • Australian Resources and Investment • Volume 10 Number 1
diesel fuel, which is prone to price
volatility and supply interruptions.
Energy can account for up to 30 per cent
of operating costs for remote area and
off-grid Australian mines. Renewable
energy offers a viable alternative that is
already competitive with fossil fuels in
many off-grid applications in Australia.
Since it was created in 2012,
the Australian Renewable Energy
Agency (ARENA) has been working
with industry to tackle the challenges
associated with integrating renewables
into off-grid locations, and into mining
operations in particular.
Some stakeholders have flagged issues
such as variable renewable output,
perceived reliability risk and appropriate
workforce skills. Other barriers include
higher up-front costs that favour longer
projects, technical issues of integrating
renewables into an existing diesel
system, and the operational challenges of
incorporating new technology.
ARENA is funding several projects
with mining and other partners to help
address these barriers and further
drive down costs. ARENA is uniquely
positioned to invest where others won’t
because the time frames are too long, or
the rate of return isn’t high enough to
attract investors. We can help overcome
first-mover disadvantage, such as by
making up for higher cost of finance,
higher supply chain costs and bigger
construction contingency margins.
We are flexible about how grants can
be applied, either for up-front capital
support or end-of-project support.
Rio Tinto purchases solar power
for its bauxite mine in Weipa,
In 2014, ARENA, Rio Tinto and First
Solar announced a collaborative two-
phase project in Far North Queensland
to supply renewable energy to Weipa’s
bauxite mine, processing facilities,
township and port.
ARENA provided $3.5 million for the
first stage of the Weipa Solar Farm,
which saw 1.7 megawatts brought
online in September 2015, making it the
first industrial diesel displacement solar
plant in Australia.
The electricity from the 18,000
advanced First Solar PV modules is
connected to the existing mini-grid
at Weipa, and was purchased by Rio
Tinto under a 15-year power purchase
agreement. During the day, power
generated by the solar farm offsets up to
20 per cent of existing diesel-generated
electricity. It is expected to save up to
600,000 litres of diesel each year and
reduce Weipa’s greenhouse gas emissions
by around 1600 tonnes per year.
Contingent on the success of the
first stage of the Weipa project, ARENA
has committed up to $7.8 million
for a next stage, which would add a
further five megawatts of solar PV and
a significant storage component. When
complete, the 6.7-megawatt solar farm
would be capable of meeting up to
100 per cent of daytime power demand
at certain times and would have the
potential to save approximately
2.3 million litres of diesel on
average each year, reducing Weipa’s
greenhouse gas emissions by around
6100 tonnes per year.
DeGrussa Copper-Gold Mine in
Western Australia adds solar and
In July 2015, ARENA announced
$20.9 million support for a
10.6-megawatt solar PV installation
with storage at the DeGrussa Copper-
Gold Mine in Western Australia. The
Clean Energy Finance Corporation
has also committed up to $15 million
in debt finance towards the project,
which, when complete, will be one of
the world’s largest integrated solar
installations providing peak power load
to a mining operation.
The project is a unique combination
of an off-grid high-capacity solar
power array, and a fully integrated
19-megawatt diesel-fired power station.
A total of 34,080 solar PV panels will be
installed across more than 20 hectares
near the site of the underground mine
owned by Sandfire Resources NL. It will
use single axis tracking technology,
combined with a 1.8-megawatts-per-
hour battery storage system. The project
is well advanced, with the final panels
currently being installed, and the
commissioning and testing phase soon
The solar power will be purchased
by Sandfire under a six-year power
purchase agreement, and is set to
provide the majority of Sandfire’s
daytime electricity requirements with a
maximum level of penetration peaking at
93 per cent on any one day. Renewable
energy will offset approximately five
million litres of diesel each year, or
more than 20 per cent of total diesel
consumption. If the mine continues
operating after six years, ARENA
funding will be paid back as the plant
continues to generate solar energy.
A redeployable solar-diesel
alternative for mining operations
Another project that ARENA is supporting
is Laing O’Rourke’s fully redeployable,
large-scale solar-diesel hybrid power
plant, which is suitable for a range of
applications where temporary power is
required, including on mine sites.
The hybrid power plant consists
of containerised modules, including
a control centre and inverters with
external, pre-wired connections to
allow fast, easy setup and pack down.
It can be delivered, unpacked and fully
functional in a week, and the solar
panels are re-used many times over
their life span.
It overcomes the barriers associated
with permanent, fixed-frame solar
installations, and it otentially sidesteps
any misalignment between the average
life of a mine and the project life needed
to make renewable energy projects
Renewables in mining makes good
business sense, and ARENA looks
forward to continuing to work with the
sector to deliver the next generation
of innovative, cost-effective renewable
solutions suited to mining operations in
Australia and beyond.
ARENA was created in 2012 to invest in
projects that will reduce the cost and increase
the use of renewable energy in Australia.
Find out more at arena.gov.au.
Links Archive December 2015 June 2016 Navigation Previous Page Next Page