BMA signs new five-year renewable power purchase agreement

BHP has announced that the BHP Mitsubishi Alliance (BMA) has entered into a new renewable power purchase agreement (PPA) with Queensland’s publicly owned energy generator and retailer CleanCo, which is expected to provide half the forecasted electricity demand of BMA’s Central Queensland operations over five years from January 2026.

The new PPA will run to the end of 2030 and effectively extend an existing low-carbon emission power agreement between BMA and CleanCo currently running to the end of 2025. BHP says the PPA will enable BMA to continue to source half of its expected electricity needs from low greenhouse gas emission sources such as solar and wind, as well as pumped hydro.

“We are increasing renewable electricity at BMA in line with our decarbonisation commitments to 2030 and beyond, improving the long-term sustainability of our business while at the same time supporting Queensland’s renewable electricity infrastructure build, regional communities and local jobs,” said Geraldine Slattery, BHP President Australia. “We expect demand for Queensland’s higher-quality metallurgical coal to remain strong for many years to come, as major steelmakers look to reduce their emissions intensity while delivering the steel needed to support global population growth and decarbonisation infrastructure.”

BHP Chief Commercial Officer Vandita Pant said: “Using more renewable electricity at our operated assets across the globe is key to our operational decarbonisation strategy. We are pleased to continue our strong relationship with CleanCo.

“Through a growing number of agreements to supply our mines in Chile, Queensland, Western Australia and South Australia with renewable electricity, we are making good progress on decarbonisation while supporting the development of renewable infrastructure and stimulating regional economies,” Pant added.

BHP says the new PPA will help support four renewable electricity projects across regional Queensland, which combined are expected to generate more than 1500 local jobs during construction: the Dulacca Wind Farm, due for completion in late 2023; the MacIntyre Wind Farm, due for completion in 2025; and the Western Downs Green Power Hub and Kaban Wind Farm, which currently supply electricity to the grid and are expected to reach full commercial operation later this year.

The PPA is also linked to CleanCo’s new renewable energy storage initiative, which directs excess renewables to the Wivenhoe Pumped Storage Hydroelectric Power Station to support an increase in around-the-clock renewable supply and cost management.

CleanCo CEO Tom Metcalfe said: “At CleanCo we are committed to providing tailored, clean energy solutions to help our customers decarbonise. It is our role to develop solutions that meet the unique energy needs of these companies so that they can thrive in a net zero future and I am thrilled BMA has entrusted CleanCo to continue to supply reliable, renewable energy for its operations.”

BHP says it is on track to achieve its medium-term target to reduce operational greenhouse gas emissions by at least 30% by FY2030 (from FY2020 levels). BHP also has a long-term goal to achieve net zero operational greenhouse gas emissions by 2050.

The BMA collaboration with Mitsubishi Development was initiated in 2019, and forms part of BHP’s global program of projects in China, Canada, the United States and Australia to progress low-emissions technology. This is in addition to the near-term and longer-term targets BHP has set for emissions reductions within the company’s global operations.

Image: Western Downs Green Power Hub. Source: BHP.