Climate Change Report

Climate Change Report

Highlights from our Climate Action Plan

We have put the low-carbon transition at the heart of our business strategy: combining investments in commodities that enable the energy transition with actions to decarbonise our operations and value chains. As a result of this, our strategy and approach to climate change are supported by strong governance, and we are building our processes and capabilities to enable us to reach net zero emissions by 2050.

  • Scope 1 and 2 emissions

    Net zero by 2050

    across our operations

    15% reduction by 2025 and 50% by 2030

    aligned with stretch goal of Paris Agreement

    75% renewable power today

    at managed operations, mostly from hydro-power

    Deploy solar and wind at scale

    targeting 1GW in the Pilbara and green repowering solutions for our Boyne Island and Tomago smelters

    Progress abatement projects

    for emissions from process heat, mobile diesel, anodes and reductants

  • Scope 3 emissions

    Commitment to engage with iron ore and bauxite customers

    to share decarbonisation plans and seek collaboration

    Investment in multiple low-carbon steel technology pathways

    coordinated by dedicated steel decarbonisation team

    Customer partnerships with Baowu, Nippon Steel, POSCO and BlueScope

    on steel decarbonisation

    Scale up the ELYSISTM technology

    for installation from 2024

    Net zero emissions from shipping by 2050 and 40% reduction in intensity by 2025

    five years ahead of IMO ambition

  • Portfolio and capital allocation

    Up to $3bn growth capital in materials enabling the energy transition

    in 2023 and 2024

    $7.5bn capital in carbon abatement projects

    our best estimate of capital spend on mitigation to 2030, of which $1.5bn in 2022-2024

    $200m annual climate-related opex

    expected to reduce as energy efficiency work matures

    $75/t CO2e internal carbon price

    to incentivise efficiency and new mitigation projects

    Phase out purchase of diesel haul trucks and locomotives by 2030

  • Governance, policy engagement and disclosure

    AGM advisory vote every three years

    annual reporting on our progress

    External third-party assurance of our emissions and alignment of target with 1.5°C

     

    Disclose our policy positions

    and review all our industry associations’ positions and advocacy annually

    Climate performance linked to executive remuneration

     

    Commitment to implement the TCFD recommendations

    and CA100+ Net Zero Company Benchmark

Jakob Stausholm

Chief executive

While there is broad consensus on the need to tackle climate change, there has not yet been sufficient action globally. Governments, civil society organisations, companies and investors converged at COP26 to reset their ambition to reduce emissions and work in partnerships to transform our economy to net zero.

Jakob Stausholm

More

I was fortunate to attend the summit and came away from it more convinced than ever that Rio Tinto is an integral part of the solution to climate change. It was clear in Glasgow that this is the decade for action. The determination for action from the world’s largest economies was particularly significant.

In 2021, we launched our new business strategy, with the low-carbon transition at its heart. Through this strategy, we are ready to make an increasingly important contribution. The rapid shift to a lower-carbon world offers a unique opportunity for us to grow in the materials that will enable the energy transition and remain an attractive investment for decades to come. It will create additional demand for our products including copper, lithium, high-grade iron ore and aluminium, which are all vital for low-carbon infrastructure. However, we recognise that the carbon footprint of metals and minerals is significant, so we must decarbonise our operations and work with our customers on our strategy to tackle emissions across the full value chain. This is an important part of what we consider impeccable environmental, social and governance (ESG) performance – we can gain competitive advantage by providing low-carbon products that enable our customers to decarbonise.

We have set out a Climate Action Plan and have a clear and challenging decarbonisation strategy to achieve our targets. We now need to see our strategy translating into actions – this won’t be easy; inevitably there are risks and dependencies to delivering our mitigation projects. Our people understand our operations best, and they will bring innovation and solutions to the challenge of reaching net zero over the coming decades. This is why I am focused on building a culture where all our people feel trusted and empowered to drive change. With the world’s focus on tackling climate change, there’s no better time to be at Rio Tinto."

Industry associations & climate advocacy

Industry associations play an important role in constructive engagement on climate policy issues