Moranbah North Power Station, Queensland
As an energy-intensive company, a major producer of coal and neighbour of many underdeveloped communities, Anglo American has identified three main strands of climate change-related risk to which the Group is exposed:
- The increase in energy and compliance costs associated with new policy measures, including potentially significant costs from carbon pricing.
- Changing expectations from our investors, communities, customers and suppliers.
- Increased risks associated with the physical impacts of climate change on our operations and neighbouring communities.
In response to these risks, our climate change strategy has three focus areas: operational excellence; investing in technology; and engaging and partnering with our stakeholders.
The emphasis in the first phase of our climate change strategy is on identifying energy-saving and emission-reduction opportunities, setting ambitious emission reduction targets relating to site-level risks and opportunities, and developing high level plans for adaptation to regional climate change.
In 2011, we issued a new Group technical standard to manage energy and greenhouse gas (GHG) emissions performance at all our operations, and we are in the process of rolling out our energy and carbon management programme, ECO2MAN. In 2012, we analysed our performance data to identify where energy is being used, where the opportunities are to save it, and how to follow a standardised process to deliver savings. Each mine has a programme in place to continually improve how it manages energy usage, with targets to reduce its consumption in relation to a business-as-usual projection.
The new Group technical standard requires sites to identify their energy and GHG emissions-related risks and opportunities, integrate them into operational plans and establish appropriate measurement and reporting processes.
Our ECO2MAN programme helps us identify and prioritise energy efficiency and GHG savings opportunities and it is tied to our internal and external verification and assurance processes. We have also set medium-term energy and carbon performance targets.
Our vision is to run cost-efficient, low-carbon (if not carbon-neutral) mines by 2030. Achieving this will depend on identifying and implementing step-change technologies and programmes. Our approach focuses on three areas: reducing energy consumption; recovering and re-using some of that energy; and using alternative energy. We also continue to investigate opportunities for carbon offsetting.
We are researching many opportunities with key stakeholders. To date, we have invested $201 million in low-carbon, and energy-efficiency, research and technology development.
We are reviewing how we can cost-effectively implement best-practice energy technologies as standard practice in our operations. Our current focus is to scale-up energy savings through the sharing and adoption of best-available technologies in underground ventilation, diesel use, pumping, and conveyor optimisation. We aim to achieve savings of $75 million from diesel-management systems by 2016.
Engagement and partnerships
We continue to work with governments, our peer companies and other stakeholders on the development and implementation of efficient, effective and equitable climate change policies.
Legislation on environmental issues is tightening. In South Africa, the government’s proposed carbon tax, if implemented in 2016, would introduce a higher carbon cost for our business. The Department of Environment requires the registration of waste tyre stockpiles and abatement plans, and has launched an initiative to create a national online inventory of all atmospheric emissions. In Chile, our operations are responding to an increase in permitting requirements, while in Australia, the Metallurgical Coal business will benefit from the new government’s intention to replace the existing carbon-pricing scheme in July 2014 with a plan that will offer grants for abatement-technology projects.