BHP Billiton Ltd., which forecasts wind and solar energy can achieve price parity with rival sources within a decade, is partnering in a battery-storage project to test technology that could be adopted at its remote sites.
The world’s biggest miner is participating with partners, including Origin Energy Ltd., in the A$42.5 million ($32 million) Lakeland Solar and Storage Project in Australia’s Queensland-state, to test a 13-MW solar PV installation and grid-scale storage, BHP said Monday in a statement.
“We want to identify the technologies that have the opportunity to materially lower emissions,’’ Fiona Wild, BHP’s vice president, sustainability and climate change, said Friday in an interview in Melbourne. “We are looking at batteries in a fringe-of-grid location and a lot of our locations fall into that category.’’
Mining companies, including Barrick Gold Corp. and Rio Tinto Group, are installing or testing the use of solar power to reduce costs and emissions. In markets including Chile and Morocco, renewable energy sources already compete with non-renewable fuels on cost and will achieve global parity on a new-build, unsubsidised basis within a decade, BHP said.
Non-hydro renewable power will grow at more than 9 percent a year through 2025, according to BHP, which said its view is more bullish than peers. Sandfire Resources NL, which completed installation this year of a 10.6-MW solar farm at its copper mine in Australia, forecasts it may cut fuel costs by half compared with diesel-generated power.
The Lakeland project, being developed by Conergy AG, will include a 10.8-MW solar plant with lithium-ion battery storage, and is scheduled to be completed by April. An ability to store renewable energy in remote locations would boost miners’ options at operations located far from power infrastructure, BHP’s Wild said.
The Paris climate accord negotiated last year, which seeks to limit temperature increases from pre-industrial levels to well below 2 degrees Celsius, is “more substantial and ambitious,” than expected, BHP said in its statement. The scale and pace of global cooperation on climate policy and links between carbon markets may be threatened by any rise in protectionism or constraints on free trade, BHP said.
BHP sees the accord as supporting previous studies that mean it expects to lose about 2 percent of the value of its assets by 2030 because of measures that put a price on pollution, according to Wild. Investments in thermal coal or oil would be put at most risk under concerted global action, while the development of gas assets could become more attractive, the company said.
Oil demand is likely to be crimped by increased fuel efficiency and rising demand for electric vehicles, which may account for 13 percent of the new vehicle fleet in 2035, according to BHP’s benchmark internal forecasts. The producer has also considered a more dramatic take up, where electric vehicles account for 30 percent of new automobiles by 2030, according to Wild.
BHP — focused on production of iron ore, copper, petroleum and coal — has reviewed its mix of commodities, including the addition of other materials, amid its forecasts of rising demand for renewable energy and electric vehicles, according to Wild.
“It’s not just about saying have we got the right things in the portfolio,” Wild said. “It’s also about saying are there also other things we should be considering.” BHP’s board is currently comfortable with the producer’s product mix, she said.
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