Mining companies are driving away from diesel-powered truck fleets that account for much of their greenhouse gas emissions to low- or zero-carbon alternatives, though the transition will be costly and logistically challenging.

Mining companies have announced commitments in 2021 to develop and adopt lower-carbon trucks to curb fossil fuel emissions from mines as part of plans to reach net-zero targets. Haulage trucks offer a significant opportunity, whether through new scrap and recycle programs or emissions reductions. Haulage trucks can comprise 20% to 25% of total emissions, the largest single source of a mine's carbon dioxide, McKinsey & Co. said in a June 29 report.

Overall, mining contributes about 4% to 7% of Scope 1 and 2 global greenhouse gas emissions, the consultancy has said. Moving to electric or hydrogen trucks can be key to slashing minesite emissions.

"Everybody's now coming around to the opinion that it's going to happen and it's doable," said Mark Fellows, CEO of Skarn Associates, a U.K.-based research firm that focuses on the mining sector's greenhouse gas emissions. "The questions now are, how long is it going to take and how much is it going to cost? And what is going to be the collateral damage, if you like, in terms of shortened mine lives or divestments?"

The list of mining companies partnering with makers of vehicles and mining equipment has grown. In March, iron ore major Fortescue Metals Group Ltd. agreed with Williams Advanced Engineering Ltd. to design and test a 240-tonne battery electric truck prototype. And in November, U.S.-based gold miner Newmont Corp. partnered with Caterpillar Inc. "to deliver a fully connected, automated, zero carbon emitting, end-to-end mining system." That includes Caterpillar's first battery electric underground trucks, which Newmont plans to use by 2026 at the Tanami gold mine in Australia. And in a joint initiative, various mining companies have joined the Charge On Innovation Challenge, founded by BHP Group, Rio Tinto Group and Vale SA, to work on mine electrification technologies with a focus on battery electric trucks.

Promises are the easy part

Swapping out diesel trucks for electric, hybrid or hydrogen-fueled motors is not a simple matter for miners. Technologies to drive zero- or low-carbon haulage trucks are still largely on the drawing board. Heavy haulage trucks need plenty of power to carry loads up steep inclines, and current battery designs require heavy batteries that must be recharged often.

The high upfront cost of electric trucks also poses challenges for miners already contending with excavation of lower-grade mines. These mines must become more efficient as they deal with higher ratios of waste rock to ore.

"We don't know yet what the cost of this is going to be, and it's going to be significant," Freeport-McMoRan Inc. Chairman and CEO Richard Adkerson said on an Oct. 21 earnings call. "I met with the senior management of Caterpillar to try to think about designing 400-tonne haul trucks that can make the grades up these big pits that we have. ... There are lots of unknowns here."

Ultimately, electric trucks should bring savings for miners. McKinsey estimated that the lifetime cost of battery and fuel cell electric vehicles will be 20% and 10% cheaper, respectively, than diesel-fueled trucks by 2030.

Companies developing new, long-life mines can go electric at the beginning, making their decisions easy. But existing mines are looking at a challenging conversion. That could mean a shake-up in mine portfolios.

"It's going, to some extent, [to] fuel decisions to close mines, to extend mines lives or to change their cutoff grades so that they're effectively high-grading for a shorter mine life," Fellows said. "It may also lead to M&A activity as some of the bigger players choose to get rid of some of the more difficult assets and say, 'We'll sell this off to somebody who isn't quite under the same amount of pressure as we are to decarbonize.'"

Source of power

Exploration companies hope that electrification and carbon emission reduction can attract funds and increase takeover potential. Arizona Sonoran Copper Co. Inc., which is developing the Cactus copper project in Arizona, is looking to electric trucks as an option as part of its commitment to net-zero emissions, President and CEO George Ogilvie said in a recent interview. The company will also consider producing 100% of the project's power from a solar farm, likely at a lower cost than grid power.

Many jurisdictions still rely heavily on fossil fuels to generate electricity, calling into question the carbon reduction benefits of going electric.

"The reality is, it makes a lot of sense to electrify whenever we possibly can," said Benjamin Cox, a program director with the Bradshaw Research Initiative for Minerals and Mining at the University of British Columbia. "But if you don't have a green source of power, then adding more electric to a mine site doesn't do much."

Mine electrification raises issues over power infrastructure. As miners electrify haul fleets, they will increase their electric power use from systems that may not have been designed for it or may simply not have capacity, a problem that is set to get worse as consumers increasingly turn to electric vehicles, Cox said.

"If you've got a remote mine site and you need to essentially double up your existing 200-kilometer electric spur line, that's not cheap," Fellows said. "And it also pre-supposes that the power company is going to have enough power to supply you."