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Future Electricity Demand South Australia's Resources Industry

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Future Electricity Demand South Australia's Resources Industry Future Electricity Demand South Australia s Resources Industry Future Electricity Demand Sout Australia’s Resources Industry Future Electricity Demand South Australia’s Resources Industry Futur Electricity Demand South Australia’s Resources Industry Future Electricity Demand South Australia Resources Industry Future Electricity Demand South Australia’s Resources Industry Future Electricit Demand South Australia’s Resources Industry Future Electricity Demand South Australia’s Resource Industry Future Electricity Demand South Australia’s Resources Industry Future Electricity Deman South Australia’s Resources Industry Future Electricity Demand South Australia’s Resources Industr Future Electricity Demand South Australia’s Resources Industry Future Electricity Demand Sout Australia’s Resources Industry Future Electricity Demand South Australia’s Resources Industry Futur Electricity Demand South Australia’s Resources Industry Future Electricity Demand South Australia Resources Industry Future Electricity Demand South Australia’s Resources Industry Future Electricit Demand South Australia’s Resources Industry Future Electricity Demand South Australia’s Resource Industry Future Electricity Demand South Australia’s Resources Industry Future Electricity Demand Sout Australia’s Resources IndustryFuture Future Electricity Electricity Demand South Demand Australia’s Resources Industry Futur Electricity Demand South Australia’s Resources Industry Future Electricity Demand South Australia Resources IndustSouthry Future Electricit Australia’sy Demand South Resources Australia’s Resources Industry Industry Future Electricit Demand South Australia’s Resources Industry Future Electricity Demand South Australia’s Resource Industry Future Electricity Demand South Australia’s Resources Industry Future Electricity Demand Sout Australia’s Resources Industry Future Electricity Demand South Australia’s Resources Industry Futur Electricity Demand South Australia’s Resources Industry Future Electricity Demand South Australia Resources Industry Future Electricity Demand South Australia’s Resources Industry Future Electricit Demand South Australia’s Resources Industry Future Electricity Demand South Australia’s Resource Industry Future Electricity Demand South Australia’s Resources Industry Future Electricity Demand Sout Australia’s Resources Industry Future Electricity Demand South Australia’s Resources Industry Futur Electricity Demandn South Australia’ss Resources Industry Future Electricity Demand South Australia Resourcec s Indudustryy Future Elece tricity Demand South Ausstrt aliaa’s Resouurcess Industry Futut re Electc ricic t Demamandnd Souo thh Ausu trralaliaia’s Resouources Indusstrt y Fututurer Elel ctrir cic tyy Deme ana d SoS utu h Australiia’a s ReResos uurcec InIndudusttryy Fututurure ElElececttrricicitty DeDemam ndnd Sououthth Ausstrralaliaa’ss Resesouurcrceses Inddusustrtry FuFututurere Elelectctriricic tyty Deme anan SoSoutth AuAuststraralliia’’s ReRessooururceces IInnduduststryry Fututuurre ElEleeccttrricicitty DeDemamandnd Sououthth Aususttrralaliaia’s’s Resesoouurcces Indndusustrtr An initiative of the Resources and Energy Sector Infrastructure Council For further details please contact: Joe Mastrangelo Director, Resources and Energy Sectors Infrastructure Council (RESIC) Department of Primary Industries and Resources SA Level 16, 25 Grenfell Street Adelaide GPO Box 1671 Adelaide 5001 DX 667 P: +61 8 8226 5059 Mob: +61(0) 417 812 148 Email: [email protected] Dr Nigel Long Director, Environment and Sustainability South Australian Chamber of Mines and Energy 290 Glen Osmond Road, Fullarton SA 5063 P: +61 8 8202 9999 Mob: 0448 848 038 Email: [email protected] 2 Future Electricity Demand South Australia’s Resources Industry FUTURE ELECTRICITY DEMAND SOUTH AUSTRALIA’S RESOURCES INDUSTRY DISCLAIMER This document has been prepared for the South Australian Chamber of Mines and Energy (SACOME) and the Resources & Energy Sector Infrastructure Council (RESIC) hereafter referred to as the “Parties”, as an instrument to support the identification of infrastructure issues as they relate to South Australia’s future mining activity. This document is not intended to be relied upon or used for other purposes, such as investment decisions related to further electricity generation, transmission or distribution capacity. It has been developed using information and reports prepared by a number of third parties, which are neither endorsed nor supported by the Parties. Any individual proposing to use the information presented in this document should independently verify the accuracy, completeness, reliability and suitability of the information provided, as well as the reports and other information used by the Parties in its preparation. The Parties, its servants and officers, make no warranty as to the accuracy, currency, reliability, completeness or suitability for particular purposes of the information in this document. The Parties, its servants and officers accept no liability (including liability to any person by reason of negligence) for any use of the information in this document or for any loss, damage, cost or expense incurred or arising by reason of any error, negligent act, omission or misrepresentation in the information in this document or otherwise. Future Electricity Demand South Australia’s Resources Industry 3 4 Future Electricity Demand South Australia’s Resources Industry TABLE OF CONTENTS Executive summary ........................................................................................................................... 7 Introduction ........................................................................................................................................ 8 The purpose of this report ................................................................................................................. 9 Electricity demand survey................................................................................................................ 10 Overall electricity demand ............................................................................................................... 15 Future electricity infrastructure requirements of South Australia’s resources industry .................... 19 Conclusion ....................................................................................................................................... 19 Recommendations........................................................................................................................... 20 Appendix A Realising the potential - South Australia’s strategic plan ................................................................. 21 Appendix B SA mineral resources overview ....................................................................................................... 22 Appendix C National electricity market fundamentals ......................................................................................... 24 Appendix D Planning for the future ..................................................................................................................... 25 Appendix E South Australia’s mining pipeline ..................................................................................................... 26 Future Electricity Demand South Australia’s Resources Industry 5 6 Future Electricity Demand South Australia’s Resources Industry EXECUTIVE SUMMARY South Australia has a world class geological environment. The state’s endowment in key mineral resources, especially within the Gawler Craton geological region, (Fig 1) is now being realised and developed. The recent growth in mining has been extraordinary; growing from four operating mines in 2000 to eleven mines in full production in 2009. A further five mines are expected to commence in 2010 taking the state’s total to sixteen. To support this level of expansion significant planning by industry and government is essential, and not least of these is the future demand for electricity supply and infrastructure. This paper provides a picture of the anticipated increase in electricity demand by South Australia’s resources industry to 2020 and beyond. It forms part of a collaborative project between RESIC, SACOME and ElectraNet to quantify the potential increase in electricity demand and to stimulate scenario solutions. RESIC commissioned Aurecon to facilitate an online survey targeting significant resource and infrastructure companies to gauge their perceived infrastructure demand. The data has not been interpreted or modified and has been used as supplied by the survey recipients. The data indicated that the best case electricity demand for the South Australian resources sector is projected to grow seven-fold over the next 20 years. The significant rise in this demand is influenced by BHP Billiton’s Olympic Dam expansion. Whilst current resource projects may or may not be realised for a variety of reasons, it is prudent to consider the potential demands arising from the growth of the resource sector, and plan for the infrastructure required to support it. Equally the commerciality of projects could also be determined by the availability, or otherwise, of key infrastructure. Identification of ‘clusters’ of large projected demand may present opportunities to leverage progressive solutions through economies of scale. Government implementation of climate change policies to create economic drivers to change the dynamics of energy generation from fossil fuels towards low
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