Rio Tinto shows BHP how it’s done
The Australasian Centre for Corporate Responsibility (ACCR) is commenting on Rio Tinto’s (ASX:RIO) newly announced emissions reduction targets and strategy.
Rio Tinto has committed to:
- Reducing Scope 1 & 2 emissions by 15% by 2025 (on 2018 levels) previously its 2030 target
- Reducing Scope 1 & 2 emissions by 50% by 2030 (on 2018 levels)
- Allocating ~US$7.5 billion in direct capital expenditure to decarbonise its assets between 2022 and 2030 (US$0.5 billion per year from 2022 to 2024)
- Rapid deployment of 1GW of solar and wind power generation in the Pilbara to replace gas-fired power generation
- Progress options to decarbonise its Boyne Island and Tomago aluminium smelters, which will require an estimated 5GW of solar and wind power generation plus firming
Dan Gocher, Director of Climate & Environment at the Australasian Centre for Corporate Responsibility (ACCR) said:
“Rio Tinto has finally joined the party with some very ambitious emissions reduction targets, showing BHP and its shareholders what climate action for a diversified miner should look like.
“While not as ambitious as Fortescue Metals Group’s net zero emissions by 2030, Rio Tinto has come a long way under Jakob Stausholm.
“Rio Tinto has sent a very strong message to COP26 and the Nationals party room: decarbonisation is happening, get on with it or get out of the way.
“While Rio has not announced more ambitious targets on its Scope 3 emissions, it is exploring alternative steelmaking technologies and we look forward to more movement on that front in the months ahead.
“Just last week, 83% of shareholders in BHP approved its Climate Transition Action Plan which is based on a medium-term emissions reduction target of just 30% by 2030 (on 2020 levels). Investors must now be asking themselves why they cast aside ambition and supported such weak targets.
“For more than 20 years, Rio Tinto’s industry associations campaigned against climate action on the premise that it was too expensive. Today’s commitment finally puts that lie to bed. Barnaby Joyce and Matt Canavan should take note.”
Peer comparison of medium and long-term targets
|Company||Medium-term target||Long-term target||Scope 3|
|Anglo American||Reduce net emissions by 30% by 2030 (2016 baseline).|
Improve energy efficiency by 30% by 2030 (2016 baseline).
|Net zero operational emissions by 2040.||Shipping: Partnered with the GlobalMaritime Forum and founding signatory to the Sea Cargo Charter (established a standard methodology to measure and align shipping emissions to the Paris Agreement).|
Introduced LNG fuelled capesize+ vessels.
|BHP Group||Reduce operational emissions by at least 30% by 2030 (2020 baseline).||Net zero operational emissions by 2050.||2030 goals: Support development of technologies capable of 30% reduction in integrated steelmaking; Support 40% emissions intensity reduction of BHP-chartered shipping.|
2050 targets: Net zero by 2050 for operational GHG emissions of direct suppliers, subject to widespread availability of carbon neutral goods and services; Net zero by 2050 for GHG emissions from all shipping of BHP products, subject to the widespread availability of carbon neutral solutions.
Goal of net zero Scope 3 emissions by 2050.
|Fortescue Metals Group||Net zero operational emissions by 2030 (2020 baseline).||Net zero operational emissions by 2030.||Net zero Scope 3 emissions by 2040.|
Reduce emissions intensity in shipping of FMG iron ore by 50% by 2030 (on 2021 levels).
Reduce emissions intensity in steelmaking by FMG customers by 7.5% by 2030 (on 2021 levels).
|Glencore||50% reduction of total (Scope 1, 2 and 3) emissions by 2035 (2019 baseline).||Ambition to achieve net zero for Scope 1, 2 and 3 emissions by the end of 2050.||50% emissions reduction by 2035 (2019 baseline) and ambition of net zero Scope 3 emissions by end of 2050.|
|Rio Tinto||Reduce Scope 1 and 2 emissions by 15% by 2025 (2018 baseline).|
Reduce Scope 1 and 2 emissions by 50% by 2030 (2018 baseline).
|Ambition to reach net zero operational emissions by 2050.||Scope 3 goals:|
- Reduce Rio Tinto-chartered shipping emissions intensity by 40% by 2030; net zero ambition by 2050.
- Work with customers to develop and invest in technology to reduce carbon intensity of steelmaking by at least 30% by 2030; net zero by 2050.
- Develop breakthrough technology enabling net zero aluminium smelting.
|Vale||Reduce Scope 1 and 2 absolute emissions by 33% by 2030 (2017 baseline).|
Reduce Scope 3 emissions by 15% by 2035 (2018 baseline).
|Net zero operational emissions by 2050.||Shipping: Supporting a reduction in shipping emissions intensity by 40% by 2030 and 50% absolute emissions by 2050, aligned with IMO targets - EcoShipping Program.|
Partnerships and investment in emissions reduction technologies, particularly in steel decarbonisation.