Fortescue fast-tracks “world’s first” large scale green grid to eliminate diesel and other fossil fuels

Andrew Forrest’s iron ore mining giant Fortescue has formally unveiled – and fast-tracked – what it describes as the “world’s first” replicable green grid that can eliminate diesel and other fossil fuels for large-scale industry.

Fortescue has already made clear its intention to reach “real zero” emissions and eliminate the burning of all fossil fuels for power and transport at its giant Pilbara mines by 2030.

It now expects to be able to power all its operations there for 24-hour periods with no fossil fuels by the end of 2027, and will be able to make annual savings of at least $US100 million ($A150 million) by doing so.

“Unlike other large renewable hubs, which feed intermittently into national or other power systems, Fortescue’s off-grid system will be the largest of its kind dedicated to decarbonising major industry, around the clock,” it said in a statement on Friday.

Fortescue’s plans are hugely significant, and not just because they fly in the face of everything that the fossil fuel industry and its conservative mouth-pieces have told the world about the inability of renewables and storage to power heavy industry.

Fortescue’s goals contrast with the skepticism of its major industrial rivals such as BHP and Rio Tinto, and the outright rejection by another major competitor, Gina Rinehart’s Hancock Mining, and promise to be a lighthouse moment for the green energy transition.

They also come as the mining industry, via the Minerals Council of Australia, uses the Middle East fuel crisis as an argument to push back on, rather than accelerate, the country’s transition to renewables.

“It’s completely expected …. but it’s absolutely ridiculous,” Fortescue CEO Dino Otranto told journalists in a briefing on Friday morning when asked about the MCA push to dilute the Safeguards Mechanism.

Otranto said the falling cost of wind, solar and battery storage – and the rapid development of software and AI to manage it – meant the transition from fossil fuels for big industries such as his is “a complete no brainer.”

The Pilbara is one of Australia’s biggest economic centres, but has been powered almost entirely by gas and diesel, making it one of the most emissions-intensive hubs in the country. Unlike its now stalled green hydrogen plans, Fortescue’s “real zero” target is based around existing and competitive technologies.

Fortescue expects to have 290 megawatts (MW) of installed renewable capacity by early next year, meaning it will be able to meet the the fixed energy requirements of its ore processing facilities, enabling daytime “green processing” across its Pilbara operations.

By the end of 2028, it expects to complete its Pilbara green grid with 1.2 gigawatts (GW) of solar capacity, more than 600 MW of wind generation, and 4-5 gigawatt hours (GWh) of battery energy storage.

“As global energy supply chains become increasingly unstable and the massive risks of fossil fuel dependence are exposed, Fortescue is moving faster – proving industry can power itself with green energy, control its costs, and take back control of its largest risk – energy,” it says.

Fortescue expects a further reduction in mining costs of at least $US2-4 per wet metric tonne by the time it completes its decarbonisation program.

“This demonstrates that eliminating fossil fuels is not only achievable, but economically superior. This deployment shows that a fully integrated renewable energy system can be built at speed and scale, delivering immediate benefits in cost, certainty and energy security.”

Fortescue is now so confident of its technology that it is touting it to other customers. It estimates that 2 GW of wind and solar and 4 GWh of battery storage can be delivered for around $2.5 billion.

Otranto says the company is already in discussions with potential customers on such a deal – so would not provide a cost per megawatt-hour figure. He hinted at data centres, green ammonia and other potential users.

“I think we’re starting to get into a bit of the commercial sensitivities of what our announcement will be … on some of the off-takes we are discussing,” Otranto said in response to a question from Renew Economy.

“But it’s already been verified that … the value proposition is well in favour renewables. And the latest data I’ve seen is that it’s even ahead of (existing) coal, which is a fundamental breakthrough. And again, I keep pointing to the fact that it’s a no-brainer.”

Other smaller miners that have committed to high renewable energy systems are already reaping the benefits of their reduced exposure to diesel and other fossil fuels.

Bellevue Gold this week says it is now sourcing 90 per cent of its power needs from wind and solar (backed by a battery) and its diesel bill is now down to around 1.2 per cent of total operation costs, less than one-tenth of other miners. It says it has already reached “net zero” emissions on its operations.

Fortescue is more ambitious, saying its goal is to reach “real zero” by 2030, if not earlier. It’s cost estimates have been boosted by the plunging cost of battery storage, the falling cost of solar, and new “self lifting” wind turbine technologies that it has developed through Nabrawind.

“You cannot argue with those economics,” Otranto says.

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