Tracking gold mining's steps on the path to net zero

John Mulligan
Director, Climate Change Lead and Market Relations
World Gold Council

In my recent discussions leading up to the publication of our new research report, Gold and climate change: the energy transition, a journalist commented that he had once covered the gold sector and, in those years, any reference to climate change was likely to be immediately dismissed by industry leaders. “So, what’s changed?” he asked.

I was tempted to answer “everything,” but instead – perhaps, more accurately – replied, “a lot”.

Certainly, the wider investment – and associated policy - landscape has been transformed beyond recognition over the last decade, and particularly over the last few years. Corporate purpose and performance are now being reframed by wider ESG considerations, and asset selection and investment decisions are being evaluated against ESG performance metrics. And climate change has been a primary driver of this radical shift in perspective and priorities, with the goals and targets of the Paris Agreement as key focal points.

You will doubtless have seen over the last year, month, or even day, announcements from a growing number of companies, cities, and countries publicly committing to a net zero carbon future. But how realistic and practical are these commitments, and how do they translate into demonstrable reductions in greenhouse gas (GHG) emissions?

I think there is, in some quarters, a degree of scepticism regarding the rush to net zero, even if the climate science tells it is vital. Investors, in particular, are very eager to hear more from companies and sectors regarding how they are moving beyond aspirations to implement firm actions and measure progress. Indeed, these requirements are rapidly being embedded in formal principles, guidance, and ratings.

Which brings me back to the question, have things changed in the gold mining sector and, if so, how might gold miners respond to the burgeoning requests for greater clarity on their ability and plans to contribute to emissions reduction? Our new research seeks to address at least some of these issues.


Our earlier work on gold’s climate impacts has already established that the bulk of emissions across the whole gold supply chain are produced from gold mining, and around three-quarters of those emissions are related to the generation and consumption of electricity – what, in the new research, we term ‘power emissions’. This gave us some confidence that there was a relatively clear route to decarbonisation, supported by our analysis of the rapidly changing economics of the energy market and the growing accessibility and competitiveness of cleaner power sources.

This new research aims to offer investors and stakeholders considerably more detail regarding what actions might be taken to reduce gold mining’s power emissions. It analyses the current status of the industry, in terms of its power consumption and emissions profile, and the likely impacts of announced shifts to lower carbon power sources at particular mines. And it also considers the substantial impacts from the projected decarbonisation of grid-sourced electricity in 31 different gold producing countries, and the impacts from a changing ‘asset mix’ - the closure of (or reduced production from) higher emission mines. The impacts of the range of factors shaping the industry opportunities to decarbonise its power sources are measured against key climate targets.

In broad terms, the research suggests where, over the next decade, we might expect gold mining to be if it continues on its current direction of travel, particularly if the sector is able to extend and accelerate current trends.

And this has consequences for the whole gold value chain. Decarbonising gold mining equates to decarbonising gold as an asset. The gold sector may be in the early stages on the pathway to net zero, and there are certainly many steps to take and obstacles to overcome, but our analysis suggests this journey, towards Paris-alignment, is not only possible, but will likely be supported by a range of changes from within and beyond the industry.