An integrated energy management strategy for the deep-level gold mining industry

Abstract

In recent years, the South African deep-level gold mining industry experienced a rapid decline in gold production figures. Numerous challenges – such as lower ore-grade mining, low commodity prices and higher-than-inflation operating costs – played a crucial part in the production decline. Because of these challenges, gold mining in South Africa has become a marginal operation with very little contribution to the country’s gross domestic product. Most of the abovementioned challenges experienced are beyond the control of the gold mining industry. The expenditure on electricity, which forms part of a gold mine’s largest operating costs, is one of the challenges offering large potential for reduction. Although electricity is not the largest capital expense in gold mining, it remains one of this industry’s biggest concerns. This is mainly due to electricity prices increasing more than inflation in South Africa and the gold mining industry’s electrical intensity for sustainable production. The challenges in modern day gold mining and the high electricity cost rates present an opportunity for electrical energy management. Effective energy management would help to reduce capital expenditure on the electricity portion of a gold mine’s operating costs. In turn, this would contribute to increased profitability and help gold mines to remain operational and competitive within global markets throughout less favourable times. Research proved that there are no existing energy management strategies in the South African gold mining industry. However, numerous initiatives contributing to the concept of electrical energy management in the gold mining industry were found. The research mainly highlighted the implementation and maintenance of load shifting, peak clipping and energy efficiency projects on the energy-intensive components of gold mines such as pumps, compressors, refrigeration machines, ventilation fans and winders. Energy services companies mainly implemented these projects as part of the Eskom Demand Side Management intervention. Some studies also focused on ISO 50001-compliant techniques for project implementation, maintenance and energy savings reporting. All of these studies contributed to optimised techniques for implementing energy savings initiatives in the gold mining industry. Combining all of the abovementioned initiatives within a comprehensive energy management strategy for the gold mining industry is, however, a scarce topic in literature. Therefore, the aim of this study was to develop an integrated energy management strategy (IEMS) for the deep-level gold mining industry. The strategy would serve as a sequenced framework for gold mining groups to practise effective energy management at shaft level and consequently reduce the electrical energy consumption of the entire group. The strategy was also developed to comply with the requirements of the ISO 50001 energy management standard to ensure continual energy performance improvements. The IEMS was implemented at one of South Africa’s largest gold mining groups (Group A). The implementation commenced at Group A’s most electricity-intensive mineshaft (Mineshaft B). The sequenced approach of the IEMS provided the energy management team of Mineshaft B with an energy management framework that resulted in an 18.5% electrical energy cost reduction within 12 months (January–December 2015). The improved electrical energy performance accumulated to an annual financial cost saving of approximately R75 million for Mineshaft B. Due to the positive impact on Mineshaft B’s electrical energy performance, the IEMS was expanded to all the other mineshafts of Group A. The IEMS implementation is also ongoing at Mineshaft B as the strategy complies with the continual improvement Plan-Do-Check-Act cycle of ISO 50001. Assuming an 18.5% reduction (Mineshaft B result) at all the other shafts of Group A, an annual financial cost saving of approximately R220 million is possible. However, it is important to note that this figure only applies for the first year after implementation. The IEMS implementation is a continual process and substantial cumulative cost savings are viable