Climate Smart Mining

Climate Smart Mining – Necessary for a sustainable energy and mobility transition!

23.05.2018 |

Since the beginning of this year, the Sector Programme Extractives for Development and the World Bank’s Energy and Extractives Practice have been partnering on a project called "Climate Smart Mining for a Low-Carbon Future". This partnership emanated from discussions during a side event at the UNFCCC’s (UN Framework Convention on Climate Change) 23rd Conference of the Parties, held in Bonn, Germany, in 2017.

The collaboration is based on the central assumption, derived from a World Bank study in 2017, that the global energy and mobility transition will trigger a substantial increase in demand for basic, precious and rare earth metals, and therefore, a significant expansion of mining activities in developing countries for a number of key minerals. While this shift in mineral demand represents a considerable opportunity for resource-rich developing countries, it can also set a series of challenges in the extraction and processing of these materials from a sustainable perspective. This includes managing greenhouse gas emissions, energy and water use and local environmental impacts to ensure that social pressures are adequately addressed.

The answer to these challenges therefore lies in a ‘climate smart’ approach: an approach that promotes climate-friendly mining practices, taking into account environmental and social issues. GIZ and the World Bank are holding a series of regional roundtables discussions to inform what a climate smart approach should actually entail, and which policies and measures by governments would be useful in promoting such an approach. These consultations began with an expert roundtable in Toronto, continuing with another consultation session held recently in Bonn (see below) and will be followed by the first regional workshop in Santiago de Chile. The effort looks to develop a dialogue between the mining, climate, clean technology and investment communities. For any climate smart approach to be successful, it must bring in these four constituencies in an active and continuing dialogue. 

Taking advantage of the intersessional negotiation rounds in the UN climate process, which took place in Bonn in early May, GIZ and the World Bank consulted with civil society and the private sector on May 4, 2018. Representatives from the World Bank introduced their report on The Growing Role of Minerals and Metals for a Low Carbon Future. Using illustrative examples, they demonstrated how the technologies required for a low carbon future – wind turbines, solar panels and storage batteries – are particularly mineral intensive. To meet this growing demand, resource-rich developing countries are likely to be faced with a growing market for their commodities. The question that needs to be addressed is how resource rich-developing countries can best position themselves to take advantage of the evolving commodity markets in a way that is consistent with countries’ climate and sustainability goals, and how the development community can best support these countries in tackling associated challenges.

In the subsequent discussion, civil society and the research community provided important inputs on issues, such as the directly linked role of energy/resource efficiency, recycling and policy recommendations. A climate smart approach, in the view of civil society, must address issues well beyond responsible environmental and material management. It must also address the broader social and development issues, including human rights violations, social equity, eco-justice, child labour, and planetary boundaries. It was pointed out that the Paris Agreement itself spends considerable attention, in its ‘chapeau’ to these issues, and so a ‘climate smart’ approach must respect those parameters.

The private sector could benefit from a mix of regulations and optional initiatives in support of sustainable supply chain practices. Stronger partnerships between governments and the private sector were emphasized: for example, as the knowledge of existing mineral and metals deposits often remains in the information base of private companies, a knowledge exchange with governments is critical. The private sector participants moreover focused on the importance of new trends, digitalization and the state of involvement in the Extractive Industries Transparency Initiative (EITI) process to advance innovation in resource governance globally. All participants agreed on the importance of including all relevant actors in the discussion, as well as communicating with them on an equal level to be able to create the dialogue as openly as possible.

Although there has already been a shift towards the use of clean energy in the mining sector recently – not only for economic reasons, but also due to reputational and regulatory pressures – further action is still required. The challenge for improving government supervisory and coordinating capacity for the commodity sector only becomes more acute as the demand for these critical elements grows. This requires a strong basis for meaningful dialogue between all stakeholders – governments, business, civil society and the research community. In conclusion, the shift to a clean energy future will be much more material-intensive, but if properly governed, managed and operated, particularly at the local level, the overall climate and economic benefits should far outweigh the challenges.

For further information, please contact Johannes Lohmeyer.

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