Rio Tinto has committed to a 50% reduction in its Scope 1 and 2 emissions by 2030 and aims to achieve net zero emissions by 2050.
Rio Tinto’s Kennecott operation, a major copper producer in the United States, has taken a significant step toward its decarbonisation objectives by formalizing a 15-year virtual power purchase agreement (VPPA) with TerraGen. This agreement secures a substantial portion of renewable energy from TerraGen's newly completed wind farm in Texas, marking a major milestone in Rio Tinto's strategy to reduce its operational carbon footprint.
The landmark deal, which coincides with the official commissioning of the wind project, sees Rio Tinto committing to purchase 78.5 megawatts (MW) of renewable energy. This power will be generated by TerraGen’s 238.5 MW Monte Cristo I Windpower project, a facility whose commercial operations were celebrated with a ribbon-cutting ceremony on-site today.
This VPPA represents a critical move to green the power supply for Kennecott, which is located in Utah. Virtual Power Purchase Agreements allow a buyer (Rio Tinto) to financially support and purchase the energy credits from a distant renewable energy project (in Texas), injecting clean energy into the grid and offsetting the emissions associated with the buyer's electricity consumption elsewhere.
Nate Foster, Managing Director of Rio Tinto Kennecott, emphasized the strategic importance of this development. “This agreement strengthens Rio Tinto’s renewable energy portfolio in the United States and supports the continued growth of greenfield renewable energy generation capacity in the U.S. grid,” he stated. The investment not only provides clean energy but also helps expand the overall capacity of renewable generation on the national grid, aligning with broader environmental goals.
The wind power deal is not an isolated initiative but the latest in a series of proactive renewable energy projects undertaken by Kennecott. The company successfully installed a 5MW solar plant in 2023 and is currently nearing completion on a second, more significant 25MW solar plant. These on-site and virtual agreements demonstrate Kennecott’s dedication to sourcing power from low-carbon sources.
“We continue to look for ways to power our operations while also lowering our emissions to help achieve Rio Tinto's long-term decarbonisation goals," Foster added, highlighting the company’s sustained focus on environmental stewardship and operational efficiency.
Globally, Rio Tinto already sources approximately 78% of its electricity from renewable sources. The company's current investment and supply decisions, including this new VPPA, are designed to significantly increase this proportion, targeting a transition to approximately 90% renewable electricity by 2030.
