Electricity Cost Forecasting in the South African Mining Industry: A Gap Analysis

Despite the rapid improvement in the availability and resolution of real-time electricity data, budget development processes in mining have remained relatively unchanged. Currently, there is no standard for the evaluation of mine electricity cost budgets. This study aims to determine whether forecasting processes used by mines produce budgets of sufficient quality and resolution to be used as a tool for daily energy- and cost management. A literature review was conducted to determine a set of best practices for electricity budgeting on mines. These findings were used to develop a survey to evaluate the current state of budgeting processes on South African mines. Surveys were conducted at 41 mine business units. Survey results were processed and analyzed and found that there are significant shortcomings in complying with the identified best practices. The majority of mines produced forecasts in lower resolutions than actual available data, thereby reducing their usefulness as energy management tools. The methods currently employed by mining sites are not scalable and are vulnerable to human error. Only 7% of participating business units’ budgets passed the identified best practices. Adherence to best practices, identified in this paper, will assist mines in improving electricity cost forecasts for more proactive- and sustainable energy management. This will also assist the industry in aligning with the UN Sustainable Development Goals (SDGs) of Affordable and Clean Energy (SDG 7), Industry, Innovation, and Infrastructure (SDG 9), and Responsible Consumption and Production (SDG 12).