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Rio Tinto (NYSE:RIO) said Tuesday it agreed to buy 80% of electricity produced from a 1.4 GW wind energy project planned by Windlab in Australia’s Queensland state to supply its Gladstone operations.
Rio (RIO) said the deal to buy energy from the proposed Bungaban wind farm for 25 years is Australia’s largest renewable power purchase agreement and will help supply power to the company’s Gladstone operations, which include an aluminum smelter and two alumina refineries.
Construction of the Bungaban project is targeted to start in late 2025 and expected to produce electricity by 2029.
Combined with Rio’s (RIO) recent agreement of a PPA for the Upper Calliope solar farm in Queensland, the combined 2.2 GW of renewable PPAs with Windlab and European Energy have the potential to lower carbon emissions by ~5M metric tons/year and could generate the equivalent of 10% of Queensland’s current power demand, the company said.
Rio Tinto (RIO) closed -4.6% to a three-month low in Tuesday’s trading ahead of issuing its half-year results, with the company expected to declare a strong final dividend but hold back on additional shareholder returns.