As the week closes, haulage represents 40 to 50 per cent of mine operating costs, and the majority of that haulage still runs on diesel
Decision Focus
On June 1, 2026, CBC News reported that multiple Canadian mining companies have begun actively approaching electric haulage equipment suppliers — including Sudbury-based Railveyor — asking whether mine sites can be redesigned around non-diesel systems. The trigger is not a technology breakthrough. It is a fuel cost structure that operators who locked in diesel-dependent fleets now describe as a structural reality, not a temporary shock. The operating signal for Mining Operations Directors: the electrification conversation has moved from capital planning to budget triage.
90-Second Brief
As the week closes, haulage represents 40 to 50 per cent of mine operating costs, and the majority of that haulage still runs on diesel. Oil price increases tied to the ongoing war in Iran have sharpened the cost exposure of diesel-dependent fleets. Equipment suppliers and advisory firms operating in Ontario confirm that mines which committed earlier to electric or battery-electric fleets have not seen a comparable cost impact. Battery-electric alternatives carry a purchase premium of up to three times the diesel equivalent, but offer fixed energy costs and measurable ventilation savings in underground settings.
What Is Really Happening?
The fuel price movement is not creating a new argument for electrification — it is accelerating a business case that already existed but lacked urgency. Haulage has always been the largest single cost lever at site level, and diesel volatility has always been a known variable. What has changed is the persistence and structural attribution of the current price environment. When a supplier CEO describes fuel volatility as “a structural reality,” that framing reflects what mine-site operators are telling her directly in commercial conversations, not a marketing projection.
The ventilation dynamic adds a second dimension specific to underground operations. Diesel engines require larger, more energy-intensive ventilation infrastructure to clear particulates to safe working concentrations. Removing diesel from the underground fleet reduces both the ventilation capital required and the ongoing energy cost of running it. Glencore’s Onaping Depth project in Sudbury operates with an electric vehicle fleet, and advisors familiar with that site describe the ventilation cost reduction as a defining factor in its economics — a confirmed operating data point from a major producer, not a pilot.
At the OEM level, MacLean Engineering currently sells between 10 and 20 per cent of its equipment as electric vehicles in any given year and has committed to a fully electric product line by 2040. That commercial trajectory indicates the supply side is building toward a tipping point in availability.
Why It Matters for Mining Operations Directors
The cost exposure is asymmetric depending on where a site sits in its life cycle. For operating mines built around diesel infrastructure — fuel storage, maintenance bays, engine rebuild programs — the retrofit path is genuinely difficult. Adding charging infrastructure to an active underground mine requires capital that was not in the original build, and existing ventilation systems, already oversized for diesel, do not generate an immediate dividend when only part of the fleet converts.
For mines entering feasibility or detailed design, or for operations with brownfield expansions under evaluation, the calculation is different. Industry practitioners are explicit: it is significantly easier to start electric than to convert. A new decline, a new level, or a new processing area represents a decision point where charging and electrical infrastructure can be designed in from the start, avoiding the retrofit premium entirely.
The purchase price gap — up to three times the diesel equivalent — remains the most common friction point in internal approvals. But that figure is a first-cost comparison, not a life-cycle one. Fixed electricity tariffs replace variable diesel pricing, and the ventilation offset for underground operations changes the total cost picture materially. Operations directors carrying cost-per-tonne accountability need both numbers in front of leadership, not just the capital line.
Forward View
If oil prices remain elevated through 2026 and into 2027, three dynamics are likely to develop. First, the inquiry pipeline at electric equipment suppliers will deepen from feasibility questions into procurement conversations, particularly from underground operations where the ventilation benefit is clearest. Second, OEMs that have invested in electric product lines will gain pricing confidence, potentially narrowing the purchase premium as volumes increase. Third, the competitive gap between early adopters and diesel-dependent peers will become visible in quarterly cost reporting — creating internal pressure at boards and parent companies to accelerate electrification timelines.
Mines in jurisdictions with stable hydro electricity pricing are best positioned to lock in the cost advantage. Those in regions where grid reliability or electricity tariffs are themselves variable face a different tradeoff, and the diesel-versus-electric comparison becomes more site-specific.
What Is Still Uncertain
The source evidence is concentrated in Ontario, Canada. Whether the economic case transfers directly to open-pit operations in arid regions, high-altitude sites, or jurisdictions without reliable grid access is not established in this reporting. Ventilation savings are specific to underground operations and do not apply to open-pit fleets in the same way.
The three-times purchase premium is a ceiling estimate from an advisory source, not an audited fleet comparison. Actual cost differentials vary by equipment class, supplier, and site configuration. The timeline to payback — fixed hydro savings versus upfront capital — is not quantified in available evidence, and that calculation will differ materially by electricity tariff, fleet utilization rate, and financing structure.
MacLean Engineering’s 2040 full-electrification target is a supplier goal, not an industry commitment. The pace at which competing OEMs bring comparable electric product lines to market will determine whether supply constraints emerge as adoption accelerates.
One Question for Your Team
Which of your current expansion decisions — new levels, portal relocations, or processing infrastructure — still have open design specifications where battery-electric fleet integration could be scoped in from the start rather than retrofitted later?
Sources
- Cbc — High diesel prices help drive mining companies to electric equipment (Link)
