CANBERRA, Australia (AP) — Australian iron ore miner Fortescue Metals Group announced Tuesday a $6.2 billion plan to eliminate fossil fuels and carbon emissions from its operations by the end of the decade.
The world’s fourth-largest iron ore producer expects to save $818 million a year from 2030 based on current diesel, natural gas and carbon credit prices, Fortescue said in a statement to the Australian Securities Exchange.
Most of the spending is planned for 2024-2028. It includes an additional 2 to 3 gigawatts of renewable energy generation and battery storage, as well as a green fleet of trucks and trains for mining.
The 2030 goal of “real zero ground emissions” — without fossil fuels and with temporary, if any, offsets — would prevent 3 million metric tons (3.3 million US tons) of carbon dioxide-equivalent greenhouse gas emissions annually .
Fortescue is a member of the First Movers Coalition, a platform launched by the US State Department and the World Economic Forum last year for companies to leverage their purchasing power and supply chains to cultivate early markets for innovative clean energy technologies.
Other major companies are also stepping up moves to reduce carbon emissions.
Last week, Samsung Electronics announced that it is moving away from fossil fuels and aims to fully power its global operations with clean electricity by 2050.
Fortescue chairman Andrew Forrest said Fortescue, based in Perth, Western Australia, was already benefiting financially from a decarbonisation policy launched two years ago.
The new decarbonisation strategy provided “an example that a post-fossil fuel era is good commercial common sense”, Forrest said in a statement.
“There’s no doubt that the energy landscape has changed dramatically over the past two years, and that change has accelerated since Russia invaded Ukraine,” Forrest said.
“In line with Fortescue’s disciplined approach to capital allocation, this investment in renewable energy and decarbonisation is expected to deliver attractive financial returns for our shareholders through energy cost savings and a sharp reduction in carbon offset purchases, combined with a lower risk-cost profile and an improvement in the integrity of our assets,” Forrest added.
Australia’s new center-left Labor government has introduced legislation that aims to cut the country’s greenhouse gas emissions 42 percent below 2005 levels by the end of the decade.
Under the previous Conservative government, Australia was rated as a climate laggard on its target of reducing emissions by only 26%-28% by 2030.