Opinion: Growing pressure on fleets to decarbonise off-highway vehicles

By Sheena Patel, director and EV sector specialist at Vendigital

The electrification of off-highway vehicles (OHVs) has a huge role to play when it comes to decarbonising transport and promoting a cleaner, greener environment in carbon-intensive industries such as mining.

As technologies evolve, the pressure on operators to make the change is growing.

Mining companies face some difficult choices when it comes to decarbonising their operations. Driven by growing demand for the minerals required to support industry-wide electrification and regulatory pressures to reduce carbon emissions on the way to net zero, the push to invest in green plant and machinery is intensifying.

Most of the mining majors have net zero and emissions reduction targets in place and are committed to decarbonisation, but they face complex challenges.

Research shows that 41% of a typical mining facility’s carbon emissions are generated by ‘hauling’ activities, where heavy-duty trucks and loaders are used to extract and transport run-of-mine ore and move large deposits of rock.

To address this significant carbon cost, operators are forging deep partnerships with OEMs and tier one manufacturers to develop fully electric or hydrogen fuel cell-powered mining trucks and loaders to meet their needs.

As most existing plant and machinery was designed for use by the mining industry, and in some cases adapted for use in specific mines, it is incredibly costly to replace.

As well as the upfront investment in supply chain innovation and the design and development of green solutions, some mining companies may have to write off significant asset value as they transition to a greener fleet.

Based on industry estimates, £75-100 million ($100-$130m) is required to decarbonise a 25-metric-tonne facility and a significant proportion of this cost will be allocated to the design, development and manufacture of new plant and machinery.

In the last few years, industry players have sought to reorganise and reshape their portfolios with a number of large divestments and acquisitions made and little appetite to necessarily invest in new mining operations.

This presents an opportunity to invest differently and support the industry’s commitment to more sustainable operations and more broadly, across the value chain.

As such, and as seen in other sectors embarking on their green commitments, a step-change is required in the industry’s approach to new and future product development.

It needs to consider important design principles such as circularity (particularly for fuel cells), manufacturability, cost-consciousness, reducing product redundancy, and the digital architecture required to monitor and optimise on-site product performance to inform continuous improvements in next-generation design.

Many mining companies are already joining forces with OEMs and tier one manufacturers to develop greener haulage alternatives and reduce the associated carbon footprint.

New partnerships are springing up across the industry, such as Liebherr and Fortescue working together to develop and validate a fully integrated Autonomous Haulage Solution (AHS), and the European Bank of Reconstruction and Development (EBRD) supporting Morocco’s mining industry by investing in Procaneq to facilitate wider use of green machinery for the extraction and transportation of phosphate ore.

Earlier this year, Boliden, Epiroc and ABB successfully deployed the first fully battery-electric trolley truck system on an underground mine test track in Sweden. 

With many more examples emerging, we see that increasing vertical collaboration and partnerships will continue paving the way for more creative ideas and opportunities to improve sustainable operations and circularity without negatively affecting performance and throughput.

With demand for critical energy transition minerals like lithium, cobalt and copper expected to increase fourfold by 2030 based on UN Trade and Development projections, the mining industry must balance its commitment to decarbonise with the urgent need to scale operations.

Competition for capacity is increasing and those that can demonstrate a more efficient and sustainable operating model, backed by a well-funded strategic growth plan, stand to gain market share.

For more information about the strategic initiatives transforming the mining industry, read Vendigital’s Transition Era report.