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Issues with ventilation in deeper underground mines is quickly making electric vehicles the first option for mining operations, according to a new report from EY.

The report, cited by The Australian, said while politicians argued about the uptake of electric vehicles, miners were quietly switching out their fleets.

“What we didn’t realise was how quickly it looks like the economic value lever is going to flip. In fact, if you are building a new underground mine, it probably already has,” EY global mining leader Paul Mitchell was quoted as saying.

While part of the push for more electric mining equipment is being driven by wanting to change perceptions of mining as a ‘dirty’ industry, cost is quickly becoming a factor for operators.

READ: Is solar ready to shine on mining?

According to the report, miners who are still reliant on diesel power find that energy costs are 30 percent of the total cost of their projects.

For underground miners, the cost of ventilation associated with it adds another third onto total cost — when there aren’t issues with the ventilation systems in the first place.

For example, BHP is currently trialling the use of light electric vehicles at Olympic Dam in South Australia after it was plagued by particulate issues which forced the company to fit expensive filters onto the exhaust fans of its equipment.

As mining becomes more automated, there’s no reason we won’t see more electric vehicles involved in mining.

READ: The 3 big pieces of tech due to drive mining in the next decade

While the move to more electric vehicles may be driven by cost and safety, the green dividends can’t be discounted either.

“Lenders are thinking ethically about where they put their money,” Mitchell said.

“If you can mount the argument there will be less carbon, and they will be supporting the green economy, I think you will see lenders and the capital markets get behind it.”

While the increasing use of EV’s in mining is great news for miners, it’s also great news for battery metals miners such as ioneer (ASX:INR).

ioneer is progressing a lithium project in the US, and news miners are looking to electrify their fleets adds to the overwhelming positive story for battery miners in the tailwind of increasing EV adoption.

Meanwhile, Infinity Lithium (ASX:INF) is betting lock-stock on Europe, with its San Jose project increasingly positioned as a solution to Europe’s lithium (and EV) needs.

 

Star Investing has a commercial partnership with some companies mentioned in this article. This content does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.