Renewables – that’s the target for Gold Fields, says CFO Paul Schmidt

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Gold Fields CFO Paul Schmidt says renewable energy sources will be better than gas.

One of the world’s largest gold mining companies, Gold Fields, has identified the opportunity to erect 10 3–4MW wind turbines from data it gathered from a meteorological mast that’s been set up at its South Deep mine in Gauteng.

These wind turbines will potentially give the mine an additional 30–40MW of renewable energy capacity, augmenting the 50MW of sun energy South Deep is already generating at a capital cost of R715 million.

During the Q&A section of Gold Fields’ ESG presentation, when executives were asked whether they had considered gas as an alternative energy source as well, CFO Paul Schmidt pointed out the fixed-cost advantage of solar and wind, and the variable cost risk of gas as a result of it being subject to market pricing.

“Renewables, that’s the target, because, as we’ve seen in Australia, gas is subject to market pricing, whereas with renewables, you have a fixed cost once you’ve installed it, plus maintenance.”

He added that, for South Deep, Gold Fields wants to go totally green in terms of wind and in terms of solar, because of the fixed cost going forward. “You don’t have market pricing that affects you, as is the case with gas and diesel.”

In fact, the mine’s solar power is doing so well that it will save South Deep up to R170 million on its electricity bill this year. Additionally, because the solar project was carried out in-house, the capital cost of R14,300 per KW has been absorbed and the margins have been put back into the business.

These developments will see Gold Fields, which has historically reported 93 percent of its emissions being related to coal-fired electricity, one step close to meeting its target of 30 percent net emission reduction by 2030 and reaching net-zero by 2050.

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