For most countries in the Eastern Europe, Caucasus and Central Asia (EECCA) region, mining is an important economic sector that contributes to employment and public revenue. Despite mining’s potential to cause long-term negative environmental impacts, governments in the region have a vital role to play in supporting better environmental performance in the sector and ensuring the industry can be a progressive part of a greener economy. This report examines the environmental impacts of mining in the EECCA and provides policy makers with guidance to reconcile environmental and competitiveness objectives in the mining sector.
Mining and Green Growth in the EECCA Region
OECD Green Growth Studies
Abstract
Executive Summary
The shift to a greener global economy will continue to demand significant quantities of natural resources, including copper, lithium and cobalt. However, the mining sector is a major potential source of immediate and long-term environmental damage. In the Eastern Europe, Caucasus and Central Asia (EECCA) region, the extraction of mineral resources remains an important contributor to export earnings, employment and public revenue at the national and sub-national level.1 Governments have a vital role to play in supporting better environmental performance in the mining sector. They can ensure that industry is a progressive partner in promoting green economic growth and achieving the Sustainable Development Goals.
Beyond reducing the impact of mining on the environment and local communities, sustainability is increasingly an asset for competitiveness. Good environmental performance lowers costs by improving efficiency and helping ensure that mining companies earn a social licence from stakeholders.
The mining sector has substantial backward and forward linkages to other parts of the economy. Shifting mining to a more sustainable path can potentially improve environmental performance in existing linkages, as well as develop new ones. This includes acting as a conduit for new technologies, such as automation and digitalisation. It also means becoming a driver for environmental service providers, renewable energy and green infrastructure.
Mining has significant environmental impacts that stretch beyond the life of a mine
Surface and underground mining – the most common mining techniques – often generate significant adverse environmental impacts. Such impacts can go beyond the immediate operational area to cross watersheds and borders. At the same time, surface and underground mining can contribute to climate change. Environmental impacts in the immediate area can include ecosystem destruction; negative effects on biodiversity; release of heavy metals, toxic substances and particulate matter through both mining and the beneficiation processes; and significant use of water resources.
OECD mining jurisdictions generally have legal requirements for site rehabilitation. However, waste rock and tailings management facilities (TMFs) can remain potentially dangerous sites of environmental contamination for decades – and even centuries – after mining ceases. Because closed mines are monitored less than operational ones, environmental impacts can be particularly damaging. These impacts can range from acute damage caused by an accident at a TMF to longer-term effects.
These issues are particularly pertinent in the EECCA region. The legacy of Soviet-era mining has left significant numbers of poorly maintained non-operational mine sites and legacy pollution, without clear paths for rehabilitation.
Technology trends on sustainability in the mining sector
Automation and remote control in mining is largely driven by productivity and safety concerns. However, it has additional positive environmental effects. For instance, automated mining trucks can reduce emissions, use inputs more efficiently and prolong machine life.
Electrification, including electric vehicles and renewable energy deployment, has potential benefits for input efficiency, reliability and emission reduction. For off-grid mines, integrating renewables can reduce emissions and costs, while improving reliability. For underground mines, electrification means more safety and efficiency.
Advances in data digitalisation and remote sensing have drastically changed the quality and quantity of data available to mining companies. Exploration companies can now use a range of remote sensing technologies to avoid more invasive approaches.
Developing the connections between the green economy and the mining sector
Improving the environmental performance of the mining sector can have tangible socio-economic benefits for the companies involved and spill-over effects into other parts of the economy. Public policy can play an important role to facilitate the transfer of skills and technology that can generate these benefits. First, it can offer incentives to encourage deployment of technology. Second, it can mandate technology transfer and training as components of mining licences. Third, it can encourage mining companies to maximise local procurement and help local companies meet internationally recognised standards. Fourth, it can develop human capacity.
Deployment of new technology: The mining sector can act as a conduit for the deployment of new green technology, including automation, which can be transferable to other sectors.
Environmental services: This shift can also generate new markets for environmental services companies that help mining companies go green.
Green shared infrastructure: Transport, water and power infrastructure can be constructed to green standards and with capacity to benefit the broader community.
The circular economy: The circular economy, a conceptual re-envisioning of economies from linear patterns of material use to one without waste, could affect the mining sector across a number of areas, including mining waste reprocessing.
Key recommendations
Successful OECD jurisdictions demonstrate a confluence of policies that together incentivise, support and regulate mining companies to reduce their environmental impact. Key recommendations to governments in the EECCA region include the following:
Develop a whole of government approach to improving mining environmental performance, using international conventions for standards and information.
Implement clear, stable and consistently enforced environmental regulation that stimulates operators to implement efficient and green techniques and technology.
Facilitate broader stakeholder participation in support of good environmental performance, including local communities in monitoring environmental impacts.
Support innovation in the mining sector through promoting sustainable and innovative infrastructure and the funding of sector-specific and applied research.
Build human capacity in technical and environmental skills and knowledge through education, training and work experience.
Develop policies to address abandoned and orphaned mine sites, including holding responsible parties liable and incentivising investment in reprocessing waste.
Support the development of a market for third-party green service providers in the mining sector, including accreditation processes
Note
← 1. The International Council of Mines and Metals’ 2016 Mining Contribution Index measures the significance of the mining sector’s contribution to national economies. Three EECCA countries (Uzbekistan, Kyrgyzstan and Tajikistan) rank among the top ten globally. Two others (Ukraine and Armenia) are in the top 20. In 2015, in the Kyrgyz Republic, Uzbekistan and Armenia mineral rents constituted 7.5%, 4.6% and 3.2% of gross domestic product respectively. In the same year, ores and metal exports contributed 44.4%, 15.6% and 12% of total merchandise exports in Armenia, Georgia and Kazakhstan.
