The decarbonization of the mining industry must proceed twice as fast

Between 2018 and 2021, the mining industry reduced emissions by an average of 2% per year. This pace is insufficient to meet decarbonization goals by 2030: there is a 40% gap compared to the targets

At the current pace, global mines will miss their greenhouse gas emission reduction targets by 40% by 2030. The decarbonization of the mining industry is progressing too slowly. Currently, the annual reduction rate is 2%. It needs to rise to 4.5% by the end of the decade to align with a trajectory that keeps global warming within the 1.5°C threshold. This is stated in a recent study conducted by the consulting firm dss+.

The decarbonization performance of the mining industry is assessed according to the SBTi standards. The Science-Based Targets initiative sets specific parameters for each sector of the economy, enabling companies to set a transition path that aligns with the most ambitious goal of the Paris Agreement.

A Compass for the Decarbonization of the Mining Industry

The global mining sector is completely off track. It currently generates between 4% and 7% of global direct greenhouse gas emissions. If it were a country, it would pollute almost as much as the entire European Union.

However, this calculation changes radically when indirect emissions (Scope 3), those generated downstream through the use of products, are also considered. From this perspective, global mining is responsible for 28% of global greenhouse gas emissions, amounting to over 19.4 billion tons of CO2 equivalent.

On this basis, dss+ calculates that between 2018 and 2021, the mining industry reduced emissions by an average of 2% per year. This pace is insufficient to meet decarbonization targets by 2030: there is a 40% gap compared to the targets. To align with the goals of the Paris Agreement, the pace must increase to 4.5% per year and include Scope 3 emissions.

Challenges and Opportunities for Global Mining Emissions

The report from the consultancy highlights key points to chart a plausible path to 2030, including major obstacles.

The most important aspect is the need to change the approach to reducing greenhouse gas emissions. So far, significant reductions have been achieved mainly through the divestment of coal-related assets, rather than operational improvements or targeted decarbonization strategies. Investments are therefore needed in this direction – decarbonizing processes – to avoid stagnation once all the dirtiest assets have been divested.

The main challenge, as in other sectors, remains measuring indirect emissions along the supply chain. The most problematic points are:

1. Lack of standardized methodologies to make emissions inventories comparable.
2. Confusion between the terms “carbon-neutral” and “net-zero,” with implications for regulators and investors.
3. The lack of historical data and established methodologies hinders effective monitoring.

Additionally, there is a specific obstacle to the decarbonization of the mining industry, which the report calls the “decarbonization paradox.” What is it? The industry must pollute less, but it also needs to significantly increase the production of critical minerals to support the global energy transition.

This is the scale of the “paradox.” Between 2017 and 2022, the energy sector tripled its demand for lithium, increased cobalt demand by 70%, and nickel demand by 40%. By 2030, current mines will be able to meet only half of the demand for cobalt and lithium, and about 80% of the demand for copper. In the Net Zero 2050 scenario, the demand for critical minerals will grow 3.5 times by 2030, surpassing 30 million tons.

The table below summarizes the barriers and opportunities for the decarbonization of the global mining industry suggested in the dss+ report: