Manufacturing News, Queensland, Renewable Energy

Australia’s biggest renewable power deal signed by industry leader

Rio Tinto has signed Australia’s largest renewable power purchase agreement (PPA) to date to supply its Gladstone operations in Queensland, agreeing to buy a majority of electricity from Windlab’s planned 1.4GW Bungaban wind energy project.

The agreement, which of follows the announcement last month of PPA for the Upper Calliope solar farm in Queensland, will make Rio Tinto the biggest industrial buyer of renewable power in Australia and is another major step in the work to repower the company’s Gladstone production assets of Boyne aluminium smelter, Yarwun alumina refinery and Queensland alumina refinery.

Under the new PPA with Windlab, Rio Tinto will buy 80 per cent of all power generated from Bungaban wind energy project over 25 years. The project which, is currently in early development, will be built and operated by Windlab at a site in Queensland about 40 kilometres from the town of Wandoan, and 290 kilometres south-west of Gladstone, subject to development and grid connection approvals.

The remaining 20 per cent of the project’s generated electricity will supply Australia’s National Electricity Market, delivering clean electricity to homes and businesses.

Rio Tinto chief executive Jakob Stausholm said, “This agreement with Windlab builds on our momentum in our work to repower our Gladstone operations and provide a sustainable future for heavy industry in Central Queensland.”

The PPA is the second renewable power deal signed for Rio Tinto’s Gladstone operations, after the recent agreement signed with European Energy to drive development of the 1.1GW Upper Calliope solar farm.

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

Once developed, the combined 2.2GW of renewable PPAs with Windlab and European Energy have the potential to lower carbon emissions by about 5 million tonnes per year and could generate the equivalent of 10 per cent of Queensland’s current power demand.

Windlab chief executive officer John Martin said, “This agreement highlights the importance of large-scale renewable energy projects in shoring up Queensland’s powerhouse traditional industries, particularly minerals and advanced processing, which employ thousands of people in regional communities across the state and have a key role to play in our nation’s low-carbon future.”

The Bungaban PPA will bring more renewable power into one of Australia’s most important industrial hubs and marks another step towards Rio Tinto’s climate goal of having its global scope 1 and 2 carbon emission this decade. If combined with more renewable power and suitable firming, transmission, and industrial policy, the Bungaban and Upper Calliope PPAs could also provide the core solution to repower Rio Tinto’s three Gladstone production assets.

“Bungaban is a key transition opportunity that will create up to 600 new Queensland construction jobs and inject around $500 million into regional economy through local economy, supply and contacting,” said Martin.

Once approved, construction of the Bungaban project is targeted to start in late 2024 and is expected to produce electricity by 2029, employ up to 600 people during construction and support up to 30 permanent jobs when operating.

“The project can be responsibly developed, grid connected and producing enough energy to power the equivalent of 740,000 Queensland homes by 2029, while eliminating about 4 million tonnes of carbon from the states generation profile every year,” said Martin.

Rio Tinto will continue to engage with potential partners to assess other proposals to help competitively meet the energy needs of its three production assets in the Gladstone region.

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