Mining drills down on renewables

Nevada's mining industry is looking closely at renewable energy - and not just for its own power needs.

The industry is looking at wind, mostly, and in some cases, geothermal as a way to make money off of land that is well suited for energy production and often exhausted from mineral mining.

"There is a lot of evaluation going on," said Russ Fields, president of the Nevada Mining Association in Reno.

"They are primarily interested in their own consumption but if it exceeds demand they would sell it back to the utility."

There are several reasons mining land is desirable.

The first is infrastructure, said Fields.

"The roads, the power lines, the substations that connect ultimately to the main grid, are already there."

That makes mining land more attractive to developers and utilities alike.

At a recent renewable energy conference in Reno, several speakers said the biggest issue facing the industry is connecting to the country's electrical grid.

"Generally speaking, we don't care where a renewable energy project is located, except the more preferable projects are near our existing transmission lines," said Gary Porter, manager of renewable energy at Sierra Pacific Resources in Reno, which is required by law to meet a renewable energy portfolio standard.

Nevada's mines are also often in areas of the state where there is significant wind and geothermal resources.

"I took a tour of Elko and a guy like me, I was in heaven," said Mick Lynch, project manager with Cielo Wind Power in Austin, Texas, who recently spoke at a conference on mining and energy efficiency held in Elko.

What Lynch saw was property ideally situated for production of wind power.

And much of it was land owned by the mining company, said Lynch, which makes it even more appealing to a wind power company such as Cielo.

"There is so little private land in Nevada," said Lynch.

"That's a big incentive for a developer like us because we don't have to go through the rigmarole with the state."

Lynch said the mining company in turn becomes interested once it understands the potential in renewable energy.

"They could charge me to send the power," over their lines, said Lynch.

"Or charge a royalty on the property.

There is more than one way to skin a cow."

Newmont Mining Corp., for one, is interested.

The gold mining company has 14 open pits and five underground mines in Nevada and controls about 3,000 square miles in the state, according to Doug Hock, spokesman for the Denver-based company.

"We see the potential in wind," said Hock.

"We're evaluating that and looking at our options."

Hock said the company is in talks now with a wind power company, but declined to say which one.

There is another powerful incentive for mining companies: reclamation.

When mining companies are finished with the land they are required by law to undertake extensive and expensive reclamation of the land.

"Once the minerals have been excavated they have to return the land to its original condition," said Tim Carlson, president of Carlson & Associates, an energy development company in Las Vegas that earlier this month bought Ely Wind LLC.

Ely Wind is one of the half dozen companies that has contracted with Sierra Pacific Resources to provide the utility with alternative energy.

The Ely Wind contract is for 50 megawatts of wind power.

Carlson now is negotiating with BHP Billiton, which owns the Robinson gold and copper mine west of Ely.

The mine has been closed for a couple years, said Carlson, and BHP Billiton has been trying to figure out what to do with it.

"The mining company has given us the rights to develop wind, and now we're negotiating the terms of the agreement," said Carlson.

"There are several options, including a reduction in their power costs or a royalty fee for the use of the land." The mine is on private land, but Carlson hopes to extend the project onto some Bureau of Land Management land.

According to Dirk Van Zyl, a professor at the University of Nevada, Reno, the BLM in the past has not been amenable to renewable energy production as a way to use the land and forestall reclamation.

But that's changing, he said.

"There is a lot of thinking happening in this area," said Van Zyl.

"There is a permitting issue and the BLM has changed its ideas in this area."

The definition of mining may changing in the process.

"I see renewables as the next step in the mining boom," said Assemblyman Jason Geddes (R-Washoe County) at the recent conference in Reno.

"It's extracting electrons, instead of gold."