Australia-based BHP has revealed it will enter a renewable energy supply arrangement with Iberdrola Australia that will allow it to reduce emissions by about half at the Olympic Dam copper-uranium mine site by taking power from the AUD 500 million ($369 million) Port August Renewable Energy Park (PAREP).
Iberdrola Australia CEO Ross Rolfe said that under the arrangement, BHP will become the primary customer of the PAREP, which will be Australia’s largest solar-wind hybrid plant once in operation in July 2022. The arrangement will include a direct link to the generation from the PAREP, which will combine 210 MW of wind with 107 MW of solar to generate an estimated 900 GWh of renewable energy annually, or enough to power about 180,000 Australian households each year.
Iberdrola, which also operates the 25 MW/52 MWh Lake Bonney battery energy storage system in South Australia, said that about half of the electricity supplied under the contract will be directly attributable to PAREP. It is expected to be ready to connect to the grid in the coming months, as the final wind turbine was installed on site in September.
The contract also includes an “innovative” mechanism which sees BHP acquire 100% of the Large Scale Generation Certificates (LGCs) for the contracted load by 2025. The deal also includes a retail agreement with Origin Energy, which will facilitate the arrangements.
“We worked very closely with BHP to design these bespoke renewable energy supply arrangements,” Rolfe said. “Olympic Dam is to be the primary customer for the Port Augusta Renewable Energy Park, a demonstration of their commitment to local procurement and sustainable economic development.”
BHP Olympic Dam Asset President Jennifer Purdie said the renewable energy supply arrangement, scheduled to commence on July 1, 2022, will contribute to the company’s medium-term target to reduce operational greenhouse gas emissions from its operated assets by at least 30% from 2020 levels by 2030.
“These arrangements will support an exciting new renewable energy project which will contribute to South Australia’s renewable energy ambitions,” she said. “Olympic Dam’s copper has an important role to play to support global decarbonization 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.”
The latest deal follows BHP’s signing of a power purchase agreement with Risen Energy earlier this year for it to supply the miner’s Nickel West Kwinana refinery in Western Australia with renewable energy from its Merredin Solar Farm. BHP has also signed a renewable energy PPA with state-owned generator and retailer CleanCo to deliver some of the electricity used across its Queensland coal mine operations.
South Australian Energy Minister Dan Van Holst Pellekaan said the deal is another step on the state’s journey to cleaner, cheaper electricity for industry, businesses and households.
“The arrangements highlight 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.
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