2025 is just around the corner, and the time for mining companies to establish their climate targets is ending. The majority have publicly committed to achieving net zero emissions by 2050 or earlier, and with interim targets due to be met by 2030, most are now in implementation mode. A s they shift from words to action, miners face a number of implementation challenges, from high costs and technology limitations to management and culture issues.
Vice Chair at Sussex Strategy Group, “involves hedging strategies, flexible operational planning, and government support.” These hedging strategies can include forward contracts and other options that lock in prices to reduce exposure to market volatility. “Mining companies manage financial and operational implications by conducting cost-benefit analyses, diversifying investments, and using complex hedging strategies. Investing in scalable technologies and maintaining operational flexibility is key to navigating economic uncertainties,” he suggests. Exemplifying this diversified technological portfolio, BHP now sources 67% of its operational electricity needs from a mix of on-site renewables and PPAs and is on track to reduce operational emissions by 30% by 2030. It reported an 11% year-on-year drop in 2023 alone. THE GROWTH CHALLENGE At the same time, demand for minerals continues to grow, and the International Energy Agency (IEA) even expects a potential supply shortage in the coming years. This means miners now face what some consider a ‘growth challenge.’ “As the demand for critical minerals is increasing, companies are going to have to be strategic about which assets they want to grow and how that growth doesn’t lead to more emissions, compromising their targets,” warns Eyab Al-Aini, Senior Research Associate, Clean Growth, at the Canadian Climate Institute. Miners’ growth plans must be accompanied by emission reduction and decarbonization. Technological and commercial innovations are making
These are not insurmountable – as long as mining companies don’t wait too long to tackle them. “I think that we will see some missed targets because there are several companies that are feeling as though they don’t have to worry about their 2030 target yet, without realizing that many of these projects take years to actually implement,” says Keith Russell, North America Director at consultancy Partners in Performance. “If you’re not acting now very vigorously, there’s a high probability that you will miss those targets,” he adds. JUGGLING PRICE VOLATILITY AND SUSTAINABILITY GOALS One of the best-known challenges facing miners as they attempt to decarbonize operations is cost. Renewable energy infrastructure and electric fleets often require much higher CAPEX than traditional equipment. Mineral prices have been particularly volatile recently, making the investment decision even more difficult. After two years of dramatic increases in 2021 and 2022, the prices of critical minerals—used in green technologies such as solar panels and electric batteries—fell sharply in 2023, with lithium dropping by 75% and cobalt, nickel, and graphite falling by between 30% and 45%. There are ways to adapt to these economic fluctuations while continuing to invest in decarbonization, which, according to Bliss Baker,
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