Iron ore processing is the main electricity consumption process in Ferrexpo`s operations
The London quoted iron ore company Ferrexpo with assets in Ukraine raised the share of low carbon electricity in total electricity consumption to 60% in 2022, compared to 57% in 2021 and 22% in 2020, as stated in the Responsible Business Report 2022 of Ferrexpo PLC.
In 2019, regulatory change in Ukraine allowed purchasing of electricity from different suppliers. Since 2020, Ferrexpo has purchased low carbon forms of energy, such as hydroelectric and nuclear power.
Also, the Group generates electricity from own solar station. Since being commissioned in July 2021, Ferrexpo’s 5 MW solar power plant has started producing electricity, which in 2022 represented 1% of total consumption. It`s a pilot project, though in the medium term, the Group continues to consider the possibility to build a larger solar power plant with a capacity of 250-1000MW.
Electricity share in total energy consumption by Ferrexpo was 41% in 2022, compared to 14% of diesel and 34% of natural gas. The main electricity intensive process being the processing of iron ore.
The Group stated that the proportion of energy consumption relating to electricity is expected to increase over time as Ferrexpo intends to decarbonize its facilities. It considers the adoption of technologies such as battery-powered and trolley assisted trucks and ultimately using green hydrogen to fuel the pelletizer.
In 2022, Ferrexpo`s electricity consumption decreased significantly, dropping by 41%, notably driven by a reduction in production volumes but also in absolute terms.
As GMK Center reported earlier, Ferrexpo assessed the capital investment needed for decarbonisation to be as much as $3.3 bln in the next 28 years (2022-2050). This figure represents the estimated total capital cost for further modernisation at the Group’s mining, processing and logistics operations to produce net zero emissions iron ore pellets