The value of simulation models when implementing mine DSM projects

Mine Demand Side Management (DSM) projects are becoming increasingly expensive. In addition, some mining groups are cash-strapped due to reduced commodity prices and higher-than-inflation cost increases. This means that client funding for DSM projects is limited. Even with Eskom-IDM´s financial contributions, DSM-projects must generate adequate and sustainable savings to ensure acceptable payback of client project capital. Unfortunately, savings from DSM projects are sometimes tough to predict. This makes it increasingly difficult to motivate client capital expenditure on these projects. One solution to predict expected results is to use simulation. In this paper, the value of simulations is demonstrated with projects on mine compressed air systems. It is shown that simplified simulations can be used to quickly determine electricity cost savings potential and the financial feasibility of proposed projects.