Digging Net Zero pathways for mining green tech metals with IFC

1As a development finance institution focused on the private sector in emerging markets, IFC is committed to climate action and the sustainable development of critical minerals. IFC supports mining companies in building their decarbonisation action plans to ensure the metals and minerals for green technologies are supplied in a resilient, equitable, and sustainable manner.

 

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Mining field
Challenge

How can the mining industry balance growing demand for green tech minerals with the need to cut emissions?

Solar panels, wind turbines, electric vehicles, and batteries, all these innovations – and with it, the extraction of minerals and metals – will need to scale if we want to meet the climate goals of the Paris Agreement and reach Net Zero.

Copper and nickel are critical inputs for green technologies. To support the energy transition, their production will need to grow by 200-300% by mid-century. However, significant greenhouse gas (GHG) emissions are associated with their extraction and processing: copper releases 4 tonnes of CO2 per tonne of copper, while nickel production releases 12-78 tonnes of CO2 per tonne.

The mining industry must cut emissions by 90% by 2050, while increasing production to meet demand. This balancing act is no easy undertaking; it requires collaboration, coordination and swift action across the whole value chain.

As a development finance institution, IFC1 is committed to climate action and the sustainable development of critical minerals. As pressure mounts on the mining industry, IFC, the private sector lead of the World Bank Group’s Climate-Smart Mining Initiative, sought to develop a Net Zero roadmap for copper and nickel mining value chains. Together with the Carbon Trust and partners, it wanted to provide guidance on how the Net Zero mine of the future is possible today.

 

Solution

Constructing a solutions guide for Net Zero mining

IFC, in collaboration with the Carbon Trust, RMI, the Colorado School of Mines, and the Columbia Centre on Sustainable Investment, set out to create a clear vision of how the industry can achieve Net Zero and develop an action-focused decarbonisation plan for copper and nickel mining. For this, it was essential to look at low carbon technology solutions and beyond.

We explored financial support mechanisms, innovation policy support, opportunities for a just transition and other ESG considerations.

The roadmap was developed through a series of in-depth consultations that IFC and partners conducted with over 80 experts from mining (e.g., Anglo American, Rio Tinto, BHP, Vale), energy (e.g. Engie), transport (e.g., Tesla), OEMs (e.g., Komatsu), downstream customers, industry associations (e.g., ICMM, International Copper Association, Nickel Institute), commercial banks, NGOs, and academia. Through close collaboration, the consortium:

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Analysed how renewable energy technology demand will increase and impact demand for copper and nickel under 1.5C and well below 2C scenarios. It revealed that emissions would double if the industry continued business as usual.

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Assessed which technologies would best help the mining industry reduce its energy intensity and minimise emissions. This included optimal timeframes for technology deployment.

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Put forward recommendations to help mining companies kick-start their Net Zero journey, while avoiding unintended ESG risks e.g., access to sustainable financing, responsible land-use for renewable energy expansion, sustainable mine closure.

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Assessed the legal and regulatory barriers to deploying low carbon technologies and how to engage policymakers.

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Launched the Net Zero Mining Roadmap and an action-driven technical report. The roadmap itself is publicly available and was presented at the African Mining Indaba, the largest mining investment conference.

While a significant portion of the technology required to achieve Net Zero mining is already accessible and scalable today, research and development investments into technologies like green hydrogen for high heat applications and in transport are still needed. In 2023, IFC launched the Net Zero Roadmap to 2050 for copper and nickel mining value chains.

Download the roadmap

Impact

Inspiring action towards the mines of the future

The roadmap tackles the crucial issue of greenhouse gas emissions from extraction and processing operations head-on.

Its implementation will provide the foundations for a just energy transition, particularly in the Global South, and propel the mining industry towards a sustainable, Net Zero value chain. Through this work, the World Bank Group’s Climate Smart Mining initiative and IFC were able to provide miners with a toolkit to adopt responsible mining practices and:

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Forge a shared Net Zero vision. The roadmap gives practical guidance and resources with which industry actors can immediately reduce their Scope 1, 2 and 3 emissions.

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Direct organisations towards existing financial instruments to leverage for their transition.

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Promote the industry to raise its ambition and commit to action. Executives of leading mining companies who were consulted are already using it in their everyday conversations.

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Lay the foundation of Net Zero mining for other metals and minerals like cobalt. While metals come from different geologies, their emissions derive from the same sources. Consequently, the same transition methods can be used.

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Recognise the scale of Net Zero challenges within the mining industry publicly, which should alter public perception and encourage cross-industry collaboration.

 


1 As a development finance institution focused on the private sector in emerging markets, IFC is committed to climate action and the sustainable development of critical minerals. IFC supports mining companies in building their decarbonisation action plans to ensure the metals and minerals for green technologies are supplied in a resilient, equitable, and sustainable manner.