Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
While renewables like wind and solar are getting cheaper and more efficient, they need storage to make them viable says Ron MacDonald, executive chairman of American Vanadium, who sees a big opportunity in supplying the market with vanadium-flow batteries.
“Renewables have never met their promise,” said MacDonald, who was interviewed at MINExpo 2012 in Las Vegas this fall.
“One of the reasons for it is that storage was a problem. How do you store vast amounts of electricity that are coming from wind that is generating the power at night when there is no market or from solar when the demand is down? Old technologies like lead acid pretty much the only way.”
MacDonald says there are new technologies out there for storing energy now but they never really met the economic test or could not be commercialized.
“Over the last six to seven years, a lot of activity in China turning up their production of renewable energy,” says MacDonald.
“Six years ago China set their first renewable targets and they were at eight percent. They over-achieved. They got 8.9%. They also became the number one producer of solar panels, the number one producer of wind turbines but they increased the efficiency of it and drove the cost down so now solar is a good investment and you can get a good return on it.”
But now China is now turning its attention to the problem of storage.
“Between now and 2021 they have set a target to achieve storage of 5% of their total electrical generation, not just on renewables. They are going to be generating 2.4 billion kw of power so if you do the math you see that storage—this is a massive new industry.
“Industry analysts have indicated that it is anywhere between $400 billion and a $1 trillion of investment globally between now and 2021 because these technologies are now commercially feasible.
MacDonald says these industries are now competitive with oil and gas.
“So this is going to be a massive new industry, a trillion dollar industry globally.
MacDonald says this is all great news for his business.
“Because the vanadium we got, the purity, and because of the way the deposit happens we will be able to produce the highest quality vanadium to go in those electrolyte vanadium flow batteries that are solution for renewables. And we are going to do it at a cost that we believe no one will be able to compete with.
Image of Ron MacDonald interviewed at MINExpo 2012
Comments
Zu Fen
The technology is ok – but 1 tonne of Vanadium only stores ~ 360MWh of energy – or 15MW for 1 day. If industrial scale backup for large scale wind/solar etc is needed then the quantities needed are immense – 1000 tonnes for a 15 GW 1 day backup – a figure approximating to the UK’s likely installed wind power production capacity (average) in the coming decade.. (rough estimates)
The question is how much backup is enough? -at how low a statistical expectation of grid power loss does this technology become acceptable for use? The issue is that unlike gas backup once the vanadium is used up the backup fails. There’s not much point of having a Vanadium backup if it itself needs gas or diesel backup too.
That said – the numbers suggest that the technology be feasible – up to countrywide scale. The quanties of metal required would be comparable with the current metalurgical and catalytic requirements – but don’t appear so great that such a scheme would be inconceivable.
I’d like to see some figures on capital costs compared to diesel or gas backup – much of the equipment is proven and low or relatively low tech – pumps (acid resistant), large storage tanks, H+ ion exchange membranes, plus large electrical inverters.
At V metal capital cost I work out about $1.5 million per GWh – I’d guess the counterion chemicals don’t add a lot to this figure (bog standard is sulpharic at a fraction of the vanadium cost) – one of the good aspects of the technology is that storage capacity is increased simply by increasing volume/mass of V – so that’s a linear scale.
Will be interesting to see if this makes it ‘big time’ – looks to have a fair chance.