Global mining giant BHP says it has signed a landmark deal with Iberdrola Australia to slash its emissions at the giant Olympic Dam mine by taking power from the new Port August Renewable Energy Park in South Australia.
Olympic Dam is one of the biggest copper, gold and uranium deposits in the world, and PAREP will be Australia’s biggest wind and solar hybrid facility with 210MW of wind and 110MW of large scale solar when it is fully commissioned next year.
PAREP, which recently completed the installation of its last wind turbine, has been built near the site of the state’s last coal fired power station which was closed in 2016.
BHP says the contract with Iberdrola will slash emissions from the electricity supply to Olympic Dam by half, and it will also means the mine will become the biggest single customer for the new wind and solar project.
The move follows similar decisions by BHP in Queensland last year, where it signed a contract with CleanCo for half of the electricity needs from its coal mines to come from wind and solar, and in WA, where the Merredin solar farm will supply half of the electricity needs of its Kwinana nickel refinery.
It has also signed wind and solar contracts to help supply the mines supplying nickel to global EV and battery storage giant Tesla.
The exact details of the agreement between BHP and Iberdrola were not released, but Olympic Dam has in the past revealed that it consumes around 200MW of power at any one time for its mining and processing operations.
The deal between the two companies will include an “innovative” mechanism whereby BHP will acquire all of the large scale generation certificates (LGCs) for the contracted part of the renewable energy supply.
The deal will be managed by Origin Energy, and will also include a “firming” element from Iberdola, which also operates the Lake Bonney battery in South Australia, and two fast start gas generators it has leased from the state government.
“This is an industry leading achievement and an important step in the transition to 24/7 renewable energy supply,” the two companies said in a statement, noting it will reduce Olympic Dam’s emissions from electricity by 50% by 2025.
BHP Olympic Dam Asset President, Jennifer Purdie said:
“These arrangements will support an exciting new renewable energy project which will contribute to South Australia’s renewable energy ambitions,” BHP Olympic Dam asset president Jennifer Purdie said in a statement.
“Olympic Dam’s copper has an important role to play to support global decarbonisation and the energy transition as an essential product in electric vehicles and renewable infrastructure. Reducing emissions from our operations will further enhance our position as a sustainable copper producer.”
BHP has gone further with its giant Escondida copper mine in Chile, where it is aiming for 100 per cent renewable, courtesy of that region’s excellent solar and hydro resources.
Mining giants and big refineries and smelters across the country are turning to renewables, including Rio Tinto – which is looking at wind and solar for its Boyne Island smelter in Queensland and for its iron ore operations in W.A., and Fortescue, which is also planning massive investments in renewable hydrogen.
Fortescue is also investing in large scale solar farms and battery storage for its mining operations, while Oz Minerals is looking at a wind, solar and battery facility that will deliver at least 80 per cent, and possibly up to 100 per cent, of the power needs of the proposed new $1 billion nickel mine.
South Australia’s Liberal government has a goal of reaching “net 100 per cent renewables” by 2030, but given the state already delivers a 62 per cent share from wind and solar – despite grid constraints – and with new projects such as PAREP coming on line, it will likely reach that target much earlier.
State energy and mining minister Dan Van Holst Pellekaan said the deal between BHP and Iberdrola marked another step on South Australia’s pathway to cleaner, cheaper electricity for industry, businesses and households.
“The arrangements highlights the good sense of BHP, Iberdrola and other companies getting the generation mix right, including wind and solar farms, grid scale storage and fast start gas, to provide cleaner and more reliable electricity,” he said in a statement.