Rio Tinto secures 25-year PPA with European Energy, aiming to reduce carbon emissions by 50%

Rio Tinto is set to spearhead the development of Australia's largest solar power project, the 1.1GW Upper Calliope Solar Farm, situated near Gladstone. In a significant move towards sustainable practices, Rio Tinto has committed to purchasing all the electricity generated by the solar farm, aiming to supply renewable power to its operations in Gladstone.

The 25-years power purchase agreement (PPA) agreement with European Energy Australia is part of Rio Tinto's commitment to make its aluminium operations on the East Coast sustainable and reduce its direct and indirect emissions by 50 per cent by 2030. This initiative underscores Rio Tinto's commitment to incorporating renewable energy sources and advancing sustainability in its operations.

With the incorporation of additional renewable power sources and the implementation of supportive firming, transmission, and industrial policies, this initiative has the potential to serve as a foundational element in revitalizing Rio Tinto's three Gladstone production facilities - Boyne aluminium smelter, the Yarwun alumina refinery, and the Queensland Alumina refinery.

This agreement not only facilitates the infusion of more renewable power into one of Australia's vital industrial hubs but also represents a substantial stride in Rio Tinto's broader climate goal of reducing its global Scope 1 & 2 carbon emissions by half within this decade.

About the construction of the solar facility

European Energy will undertake the construction and operation of the solar facility at a location approximately 50 kilometres southwest of Gladstone, pending necessary development and grid connection approvals. Subject to approval and successful development, the Upper Calliope solar farm holds the potential to significantly reduce Rio Tinto's operating carbon emissions by an estimated 1.8 million tonnes per year.

"This agreement is a first important step in our work to repower our Gladstone operations and illustrates our commitment to keeping sustainably powered industry in Central Queensland. The task remains challenging, but we have a pathway to provide the competitive, firmed power our Gladstone plants need and we are continuing to work hard with all stakeholders, including the Queensland and Australian governments, on getting there," stated Rio Tinto Chief Executive Jakob Stausholm.

Expected timings for the construction

Pending approval, the construction of the Upper Calliope plant is scheduled to commence in 2025 or 2026. Upon completion, the facility is poised to generate sufficient electricity to fulfil approximately 5 per cent of Queensland's current demand. Spanning an area of 2400 hectares, the plant is anticipated to take two years to build, involving the employment of 1000 individuals during the construction phase. Once operational, the plant is expected to sustain 100 direct and indirect jobs, contributing to the local economy and the renewable energy sector.

"Competitive capacity, firming, and transmission, are critical to developing a modern energy system that can ensure more large-scale renewables development in Queensland and help guarantee the future of Australian industry," added Stausholm.

European Energy CEO Erik Andersen stated, "European Energy is proud to be a strategic partner in this project with Rio Tinto. Our commitment to providing renewable and reliable Energy aligns perfectly with Rio Tinto's ambitious climate goals. The Upper Calliope Solar Farm is not just a solar power project; it's a testament to our shared vision for a greener future. By supplying renewable Energy to one of Australia's key industrial hubs, we are setting a new standard for industrial energy consumption. This project underlines our dedication to driving the transition towards renewable Energy in Australia and demonstrates the potential of solar power in transforming the energy landscape of the region. We look forward to continuing our collaboration with Rio Tinto and other stakeholders to create a sustainable and energy-efficient future for Australia."