‘Take the first step’: Fortescue to spend $9.2b to stop using fossil fuels by 2030 #COP27 #ClimateAction #auspol

Billionaire Andrew “Twiggy” Forrest’s Fortescue Metals Group has issued a challenge to heavy carbon emitters around the world to follow its audacious bid to eliminate fossil fuel use from its business and cut its emissions to zero by 2030.

By Farrah Tomazin and Simon Johanson

Fortescue on Tuesday said it will spend $9.2 billion to fully decarbonise its mining operations and supply its customers with a carbon-free product within eight years. Cuts to operating costs will make estimated annual savings of $1.2 billion – a sign that “a post-fossil fuel era is good commercial, common sense,” Forrest said.

Twiggy Forrest

“We really must be taking this super-seriously now,” Forrest told The Sydney Morning Herald and The Age after a high-level meeting in the US. “So my challenge to industrial leaders all over the world is: take the first step.”

Fortescue says it will invest in renewable energy generation and battery storage to power a green mining fleet, electrifying its rail locomotive ore haulage system. Ian Waldienone

World leaders gathered in New York for the United Nations General Assembly on Monday (US time) where Forrest presented his vision at a closed-door session with UN Secretary General António Guterres, urging industry rivals to stop making excuses and follow suit.

The bulk of the company’s investment will be spent between 2024 and 2028 on rolling out 2 to 3 gigawatts of renewable energy generation and battery storage to power a green mining fleet, electrifying its rail locomotive ore haulage system in the process. Studies are underway to optimise localised wind and solar resources.

‘This is an investment that I think every company in the world ought to make.’Andrew Forrestnone

Once implemented, the plan would make Fortescue the world’s first heavy industry company of its scale to go green by 2030.

“This is an investment that I think every company in the world ought to make, and an investment which, now that you can see that it can be done, every heavy industry should step out and do,” Forrest said.

Stock markets were unmoved by Forrest’s efforts, with Fortescue’s shares closing marginally lower at $17.30.

The details of Fortescue’s plans emerged as Foreign Minister Penny Wong and Energy Minister Chris Bowen also arrived in New York to take part in the UN General Assembly’s week of high-level meetings, where climate change will be a key feature in coming days.

Fortescue’s push also comes after the Albanese government’s climate bill passed parliament, setting new targets including a 43 per cent emissions reduction by 2030 and a net-zero goal by 2050 but stopping short of ruling out new coal and gas projects.

Asked what he thought of the legislation, Forrest said it was a “minimum, not a maximum, and there’s room for improvement.

“If companies like ours start to go 100 per cent green by 2030, then governments will be encouraged to adjust their policy settings. We’re out there to demonstrate that you can run Australian industry without any pollution, without any fossil fuels. So let’s get on and do it.”

Harriet Kater, climate lead at the Australian Centre for Corporate Responsibility (ACCR), said the country needed more ASX-listed companies to pursue as ambitious decarbonisation targets, including Fortescue’s resource rivals BHP and Rio Tinto.

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“Fortescue has delivered today. But it will be important for Fortescue to be transparent with its shareholders around the major assumptions underpinning these plans, along with the risks to their achievement,” Kater said.

Fortescue has been a longstanding advocate of climate change mitigation strategies, first signalling it would move towards decarbonisation in 2020.

Details of its strategy also emerged at the invitation of US President Joe Biden’s First Movers Coalition, which was launched by Biden and the World Economic Forum at COP26 to decarbonise the heavy industry and long-distance transport industries, sectors that are responsible for 30 per cent of global emissions.

Fortescue says its plan would dispense with about 3 million tonnes of carbon dioxide emissions annually through the displacement of about 700 million litres of diesel and 15 million gigajoules of gas.

“We are already seeing direct benefits of the transition away from fossil fuels – we avoided 78 million litres of diesel usage at our Chichester Hub in [financial year 2022], but we must accelerate our transition to the post fossil fuel era, driving global scale industrial change as climate change continues to worsen,” Forrest said.

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