In a latest opinion piece, Edith Kikonyogo, Managing Director, Aggreko Africa argues that within the present period of uncertainty, mine operators in Africa must counter gasoline volatility by complementing thermal technology with further vitality sources.
Brent crude costs have lately moved sharply, rising from $92 to over $113 per barrel in a single week this month. The Worldwide Power Company’s March 2026 Oil Market Report calls this the most important provide disruption within the historical past of the worldwide oil market, with practically 20 million barrels per day of crude and product exports affected by battle within the Center East and disruptions to the Strait of Hormuz.
Kikonyogo: “For mining operations throughout Africa, shifts like these carry sensible implications for working prices. Power is carefully tied to nearly each stage of the mining worth chain, from crushing and milling to air flow, dewatering, and processing. For off-grid operations, the place on-site diesel technology retains manufacturing operating, oil value volatility hits manufacturing prices straight. Delivered gasoline costs at distant mine websites throughout Africa already exceed worldwide benchmarks when you think about transport, safety, and dealing with. When world crude surges 40% in a matter of weeks, because it has this quarter, the monetary publicity compounds rapidly.”
She factors out that this isn’t a brand new problem, however the tempo and scale of disruptions are accelerating. Power technique is turning into an more and more essential a part of mining resilience and long-term planning. “Thermal technology continues to play an essential position in lots of distant mining energy methods. Diesel and gas-powered mills ship the agency, dispatchable capability it is advisable hold operations operating across the clock. In lots of circumstances, thermal technology stays a sensible requirement for sustaining dependable baseload capability.
“The problem just isn’t thermal energy. Over-reliance on a single gasoline supply can enhance publicity to price and provide volatility exterior your operational management. When each kilowatt-hour depends upon diesel alone, you aren’t simply operating a mine, you’re operating a gasoline logistics operation, uncovered to foreign money swings, transport bottlenecks, and geopolitical shocks that don’t have anything to do together with your orebody or your crew’s functionality.”
In elements of East Africa, gasoline costs have surged greater than 75% because the begin of 2026. In South Africa, petrol might see a value enhance of over ZAR5 per litre in April, whereas diesel is predicted to see a ZAR8.60 enhance per litre. “For a mine consuming hundreds of thousands of litres yearly, these swings can add hundreds of thousands of {dollars} to your price base, with zero enhance in output. That isn’t vitality safety.”
Aggreko says that one sensible response to gasoline volatility is to enhance thermal technology with different potential vitality sources. It’s to scale back the share of your vitality combine that’s uncovered to unstable commodity costs. “Hybrid energy options are designed to help a extra balanced and diversified vitality combine. Photo voltaic photovoltaic arrays, battery vitality storage, and versatile thermal technology work collectively beneath superior management to offer you a extra balanced, extra predictable vitality combine. Photo voltaic delivers low-cost vitality throughout daylight at a hard and fast price. Batteries clean your load profile and seize extra renewable technology. Thermal belongings present agency backup and peak capability, operating extra effectively as a result of they’re not carrying the total baseload alone.”
Kikonyogo states that the economics converse for themselves. “Previous regional knowledge reveals solar-plus-storage can ship electrical energy at US$0.06 to 0.20 per kilowatt-hour, in contrast with US$0.15 to over 0.50 per kilowatt-hour for diesel in off-grid contexts. Throughout a number of tasks in Africa, well-designed hybrid energy options have displaced as much as 40% of diesel consumption whereas sustaining round the clock reliability. The Center East and Africa microgrid market, valued at over US$10 billion in the present day, is projected to exceed US$21 billion by 2030. Mining is a number one driver of that development.” She says these outcomes are more and more being demonstrated throughout working websites in demanding environments, confirmed in among the continent’s most demanding environments.
“Power safety in mining more and more extends past gasoline pricing issues alone. It comes right down to a number of elements which are turning into more and more related for government and board-level consideration.” Aggreko argues that operational resilience is improved by hybrid energy options, as they construct redundancy into your vitality provide. If one supply is disrupted, others compensate. Superior controllers handle load balancing in actual time, and well-designed options routinely ship uptime above 99.9%. For a mine the place each hour of downtime means misplaced manufacturing, that resilience issues.
Monetary predictability improves when a major share of your vitality comes from photo voltaic – as gasoline prices are zero as soon as put in. “That creates a pure hedge towards fluctuations in fossil gasoline costs and gives your finance crew with a extra steady price base for long-term planning. Mines with decrease, extra predictable vitality prices additionally unlock higher entry to sustainability-linked finance and stronger phrases from offtake companions.”
Kikonyogo: “Licence to function stays key – institutional traders, worldwide lenders, and main commodity consumers now issue Scope 1 emissions and renewable vitality adoption into their due diligence. A mid-sized mine transitioning to hybrid energy can reduce CO₂ emissions by 50,000 to 100,000 t yearly. That isn’t simply an environmental metric. It’s a business benefit that strengthens your place throughout the worth chain.”
If the case is that this sturdy, why has adoption not been sooner? Whereas adoption challenges exist, a rising vary of options helps deal with them. “Capital allocation is the most typical constraint. You rightly prioritise funding in core operations: increasing the pit, upgrading processing, and lengthening mine life. Giant upfront capital spent on vitality infrastructure competes with these priorities. Different business fashions, together with OPEX-led buildings, may also help scale back upfront capital necessities. Energy buy agreements and OPEX-led buildings provide you with entry to hybrid energy options with minimal upfront funding. You pay for energy on a per-kilowatt-hour foundation, usually decrease than your present diesel price from day one.”
Operational complexity is one other concern. “You might be specialists in extracting and processing minerals, not in managing built-in vitality options that mix photo voltaic, storage, and thermal technology. That is the place working with an skilled vitality accomplice can add worth. The proper vitality accomplice brings lifecycle administration: operations, upkeep, distant monitoring, gasoline combine optimisation, and the flexibility to scale your vitality resolution as manufacturing evolves.”
Regulatory environments throughout African jurisdictions range. Navigating allowing, environmental compliance, and grid interconnection (the place relevant) requires native data and established on-the-ground relationships, says Aggreko.
Aggreko provides that the present oil value surroundings has made the price of inaction onerous to overlook. “However selections round hybrid energy are sometimes knowledgeable by long-term tendencies moderately than short-term value actions. It ought to be pushed by a transparent view of the place the world is heading. Africa holds over 40% of worldwide reserves of cobalt, manganese, and platinum, in addition to rising deposits of lithium, graphite, and uncommon earths. Demand for these minerals will intensify as the worldwide vitality transition accelerates. The mines that extract them will function for many years. Your vitality technique ought to mirror that point horizon.”
“At Aggreko, we now have spent many years powering mining operations in a few of Africa’s most distant and difficult places. We perceive that reliability is non-negotiable, that each web site has its personal constraints, and that the shift from diesel-only to hybrid energy should be sensible, staged, and confirmed at each step. We design, deploy, and optimise modular hybrid energy options that pair thermal and renewable belongings in configurations you’ll be able to scale over time, backed by versatile business buildings and operational help throughout the continent.”
Kikonyogo concludes: “More and more, the dialogue is shifting from whether or not hybrid energy can work to the best way to implement it successfully. Many tasks are already demonstrating the viability of hybrid approaches. The query is how rapidly you’ll be able to transfer to guard your operations from the subsequent disruption, the subsequent price surge, the subsequent shift in investor expectations. Mines exploring hybrid approaches in the present day could also be higher positioned for long-term price stability and resilience.”
