- Mining giant Fortescue Metals Group (FMG) is aiming to become carbon neutral by 2030, ten years ahead of its previous target
- An initial target was unveiled in June last year, which targeted net zero operational emissions by 2040
- Carbon emission targets will be integrated with the company’s formal remuneration structure, which includes both short- and long-term incentives
- Its subsidiary, Fortescue Future Industries (FFI), “will be a key enabler” of these targets by developing green electricity, green hydrogen and green ammonia projects in Australia
- Fortescue Metals Group is down 4.49 per cent to $20.30 per share
Mining giant Fortescue Metals Group (FMG) is aiming to become carbon neutral by 2030, ten years ahead of its previous target.
An initial target was unveiled in June last year, which targeted net zero operational emissions by 2040. This included a 26 per cent reduction in scope one and two emissions from existing operations by 2030 relative to 2020 levels.
This morning’s announcement, which includes direct and indirect emissions, comes as competitors Rio Tinto and BHP also step up their drive towards renewable energy.
Last month, Rio outlined a range of new targets to lower the emissions of its customers, mostly within the steel industry, and added climate change objectives to short-term incentive plans.
Fortescue, however, does not reveal estimates of customer emissions, arguing that it would be double counting under the United Nations framework, which requires nations to take responsibility for emissions within their borders.
As such, carbon emission targets will be integrated with the company’s formal remuneration structure, which includes both short- and long-term incentives.
Fortescue said its wholly owned subsidiary, Fortescue Future Industries (FFI), “will be a key enabler” of these targets by developing green electricity, green hydrogen and green ammonia projects in Australia.
Green hydrogen is a zero-carbon fuel made by electrolysis, using renewable power from wind and solar to split waster into hydrogen and oxygen, and is increasingly promoted as a way to decarbonise the emissions-heavy industrial and transport sectors.
“Our aim is to provide the two ‘missing links’ in the climate change battle, to create both the demand and the supply of green hydrogen,” said Andrew Forrest, Chairman of Fortescue Metals Group.
“Due to its high energy performance and environmental neutrality, green hydrogen and direct green electricity has the potential to eliminate fossil fuels from supply chains.”
Forrest added that, once established, these advances will also significantly reduce the company’s operating costs.
FFI’s projects include developing a ship design powered by green ammonia, testing large battery technology in the company’s haul trucks, and trialling hydrogen fuel cell power for its drill rigs.
Fortescue also hopes to conduct trials using renewable energy in the Pilbara to convert iron ore to green iron at low temperatures and without coal.
Elizabeth Gaines, CEO of Fortescue Metals Group, said the projects “will contribute to the world’s inexorable march to carbon neutrality.”
“Each will be tested by Fortescue using commercial-scale equipment to prove that the demand for direct green electricity, green hydrogen and green ammonia could one day be as large as the fossil fuel industry,” she added.
Emissions data and performance against targets will be noted as part of Fortescue’s annual reporting, while baseline and annual emissions data will be calculated on a financial year basis.
Fortescue Metals Group is down 4.49 per cent to $20.30 per share at 2:52pm AEDT.