The green energy transition is impossible without more sustainable mining

At the recent CRU World Copper Conference in Santiago, key figures from the copper mining sector gathered to discuss the future of their industry amidst a backdrop of increasing demand driven by the AI boom and green transition. The expected bull market, fuelled by essential technological advancements aimed at combating climate change and harnessing AI's economic potential, is pushing copper and other metals to the forefront of essential resources. However, the bosses of the industry were not merely focused on extracting these metals, but to do so in a responsible and sustainable way that aligns with both ecological and social benchmarks.

It’s high time for the industry to change its ways indeed. Experts predict that by 2030, advancements in AI could increase copper demand by as much as one million metric tons, severely deepening the existing supply deficits as the decade closes. At the same time, the push for a greener future through electric vehicles (EVs) and renewable energy technologies is expected to significantly boost copper usage as well, next to increasing demand in cobalt and rare earths. This surge in demand presents a critical juncture for the industry: the need to scale up production while adhering to stringent environmental standards and social responsibilities.

Mining giants taking steps in the right direction

As the world is greening, the process of extracting metals must itself evolve to ensure that it does not contradict the very goals these technologies seek to achieve. This calls for a transformative approach in mining practices, one that not only addresses environmental impact but also enhances community engagement and supports equitable benefits.

But as the CRU World Copper Conference showed, the industry is well aware of this challenge and has been taken steps in the right direction. For example, Germany’s Aurubis AG, Europe's largest copper producer, has partnered with Chile’s mining giant Codelco to lessen the impact of mining in Chile. The Germans signed a Memorandum of Understanding (MoU) to exchange cutting-edge mining technologies, expertise and new methodologies designed to bolster environmental credentials across the supply chain. Aurubis is looking into sharing technology “from its main Hamburg smelter, where it has achieved low pollution enabling it to work in a city-centre site.”

Codelco and Aurubis will be cooperating on more than 15 joint projects, during which six core working areas will be addressed – ranging from technical projects for more environmentally friendly production in Chile, promotion of awareness of a sustainable supply chains among staff as well as ESG development with a particular focus on The Copper Mark sustainability quality seal, innovation and new decarbonising processes.

Similar steps are being taken in the Democratic Republic of the Congo (DRC) by Chinese mining company CMOC Group. The Chinese firm is set to vastly ramp up its copper and cobalt output in the near future in response to the increasing demand for both metals. With CMOC’s copper production expected to reach 520,000-570,000 tonnes next year, the company has been involved in efforts to integrate responsible mining practices in its copper and cobalt operations. CMOC is part of the Fair Cobalt Alliance, under which the firm is working towards improving the working conditions and safety of local artisanal miners.

CMOC has also implemented its environmental policies in all its operations. This means that its mining projects include Environmental Management Systems (EMS) that are certified to ISO 14001 standards and are independently audited at each operating site for recertification. They also include special employee and contractor training on environmental objectives and procedures. As a result, CMOC was upgraded in May 2023 from ‘A’ to ‘AA’ in the MSCI ESG Rating report.

With great demand comes great responsibility

These are just a few prominent examples of how major players in the resources industry are responding to the call for more sustainable practices. However, these positive efforts notwithstanding, the importance of low carbon and environmental footprints in the mining sector are hard to overstate, especially in light of the growing hunger for resources in the years to come. The copper demand and concurrent rise in prices makes exploring new copper deposits in pristine natural areas or closer to inhabited places economically viable. Case in point is Zambia, where a start-up funded by Bill Gates has located a massive copper deposit with the aid of AI, meaning that adherence to strict environmental and social standards is key if historic lessons of what mining entails are to be taken into account.

The International Energy Agency has brought this point home when it flagged that current investment in copper deposit discovery as inadequate for the needed energy sector transformation. This underscores a critical gap between ambition and reality, where the drive for resources must not outpace the commitment to planetary and human welfare.

A successful transition to a greener global economy represents a formidable challenge, and for it to be truly green and sustainable, the supply chain of critical resources needs to adhere to the same high standards. Only then can local communities and global consumers alike reap the tangible benefits from mineral wealth, especially in countries where artisanal and small-scale mining operations prevail. Implementing due diligence within supply chains, along with robust regulatory oversight, is vital for identifying, evaluating, and mitigating risks. The journey towards a truly sustainable and equitable mining industry is complex and fraught with challenges, but it is also filled with immense potential for positive change.

This article does not necessarily reflect the opinions of the editors or management of EconoTimes.