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* Anglo American also switching to renewable power in Chile
* BHP sees likelihood of more switching to renewables
* BHP has goal to eliminate use of water from aquifers by
2030
By Barbara Lewis
LONDON, Oct 21 (Reuters) - BHP, the world's
biggest miner, said on Monday it had signed four renewable
energy contracts to supply all of its Chilean copper operations
beginning in 2021, cutting energy costs by 20%.
Miners, which often use fossil fuels as the energy source in
their operations, are shifting to renewable generation as the
cost of wind and solar power drops, while social and shareholder
pressure to address climate change mounts.
Daniel Malchuk, president of BHP Minerals Americas, said BHP
had signed contracts to cover the energy needs of Escondida, the
world's biggest copper mine, and Spence, another copper mine in
Chile, the world's leading copper-producing country.
These include 15-year contracts from August 2021 with Enel
Generacion Chile for 3 terawatt hours per year
(TWh/year) and 10-year contracts for 3 TWh with Chilean utility
Colbun from January 2022.
They will displace 3 million tonnes of carbon dioxide from
2022 compared with fossil fuel-based contracts, equivalent to
annual emissions from 700,000 combustion-engine cars.
BHP did not give a cost for the new contracts, but said they
were the most extensive signed by a corporate customer in Chile.
They will result in a provision of about $780 million related to
the cancellation of the existing coal contracts, which will be
recognised in BHP's December 2019 half-year results.
"It's good for the environment, it's good for emissions, but
it's also great business," Malchuck told reporters in London.
Chile has taken a lead in renewable power, and costs there
for wind and solar energy have plunged.
Another mining major, Anglo American, said in July
it would use only renewable sources to power its mines in Chile
beginning in 2021 following another deal signed with Enel's
Chilean subsidiary.
BHP Chief Executive Andrew Mackenzie said he expected the
trend to continue globally.
"As part of global decarbonisation, similar moves from coal
more or less directly to renewables may be required over the
coming decades in other countries, particularly those without
access to cheap gas," he said.
BHP, Anglo American and other miners also say they are
seeking to reduce water use, especially as many mining
operations are in arid areas.
In Chile, BHP said it was working to eliminate the depletion
of aquifers in the desert regions where it operates. It has a
goal not to source water from aquifers by 2030 and is instead
investing in desalination plants.
(Reporting by Barbara Lewis; Editing by Dale Hudson)
