The company, which operates Australia’s largest electricity network, is extending its traditional role as a supplier of power to a range of industries, into areas such as training, design, construction and plant ownership.

Ergon Energy generation manager Glenn Walden said the skills and expertise developed to service the company’s electricity customers were much sought after by industrial and corporate clients in sectors ranging from telecommunications to mining. “We have developed successful business relationships with a range of mining clients, including BHP, Tarong Coal and MIM,” he said.

“We believe no two projects are the same and bring flexibility to meeting each job’s unique technical and commercial requirements. After initially setting up a high voltage maintenance program for Tarong Coal, for example, we were able to further add value by providing assistance with transformer failure analysis and repair specs, substation earthing design and powerline construction.

“We have also enjoyed a flexible business relationship with BHP, providing training, design, construction, test, monitoring and maintenance services. We have conducted training courses at BHP’s central Queensland coal mines — training around 150 BHP employees in high voltage switching operations.

“And we are currently establishing an asset register for their operation to assist the development of future maintenance programs.”

While Ergon’s mining-related contract services work has been concentrated in Queensland, the company is currently targeting coal mines in New South Wales to grow the business. Walden said it was also examining opportunities in the metalliferous mining sector. Sixty per cent of Ergon’s project services work was being done for external customers. “This will increase towards 80%,” he said.

“The mining industry is one of the top five industry sectors that we’re targeting. It is currently around 5% of our external work and we aim to increase that up to 20%.”

Walden said Ergon Energy was formed in mid-1999 when six former electricity distribution corporations in Queensland were merged. The company’s distribution infrastructure included more than 135,000km of electricity network, 800,000 power poles and 70,000 substations.

Ergon and its predecessors had been providing services to the mining industry for more than 30 years, Walden said. The company’s expertise in certain areas was helping mines reap significant cost savings.

“We’re currently managing a maintenance contract with MIM at its Oaky Creek (coal) operations. Using our live line capabilities for this type of maintenance work avoids taking equipment off line,” Walden said. (“Live line” work is done while an “electricity asset” is still in operation).

“The big benefit for our customers is that live line techniques increase available production time. Reducing downtime and start-up time can mean savings in the order of thousands of dollars per hour.”

Ergon has recently expanded its testing and evaluation capabilities through the acquisition of a purpose-built workshop in the Brisbane suburb of Virginia. Facilities at the site enable the company to offer independent assessment of customers’ high voltage plant and insulation systems. As well as providing a range of diagnostic test services, it can also use the facilities in transformer refurbishment.

Walden said it was important power users understood the experience and skills required to identify quality, cost-effective generating solutions, whether for a processing plant, mining operation or remote exploration site office.

“Our generation experience has come from owning and operating a portfolio of stand-alone power generation systems which supply remote communities, as well as commercial and industrial sites,” he said.

“We can provide solutions for independent, network embedded or co-generation energy systems through a variety of options, utilising diesel, gas or renewable fuels, from a straightforward power purchase agreement to a comprehensive build, own and operate arrangement. Because of our skill base, we can also help customers gain more from their existing generation plant or energy supply arrangements through energy efficiency and related services, such as quality of supply, energy audits, performance contracts and power factor correction.

“We can also provide further opportunities by arranging financial assistance for project capital, whether it’s Ergon Energy owning and operating generation plant on a customer’s site or through innovative contractual arrangements.”

Walden said the company had commenced a big push to break into the market for mine site generation related services, a highly competitive field in which there are a number of small and large suppliers of equipment and services.

“We aim to build off the relationships we have developed within the industry through the supply of grid electricity and other project services,” he said.

“We believe the mining industry offers good opportunities for our generation team — we have the skills to develop independent infrastructure to suit a broad range of generation needs.

“In the past a number of the 30 generation systems we own and operate have supplied mining operations, including mines in Croyden, Normanton and Horn Island.”

Originally published in the April edition of Australia's Mining Monthly.