Fortescue plans to phase out fossil fuels at its mines by 2028

Australian mining company Fortescue is accelerating the rollout of an autonomous green energy system to completely phase out fossil fuels, particularly diesel, at its iron ore operations, Reuters reports.

This will help the company cut costs amid rising energy prices caused by the war in Iran.

Fortescue expects to save $100 million in fossil fuel costs by next year. The decarbonization program is expected to help the company reduce the cost of a ton of wet ore by $2–4 upon completion of the program in late 2028—two years earlier than originally planned.

As Dino Otranto, Fortescue’s chief executive officer of metallurgy and operations, noted, disruptions caused by the war with Iran have forced the company to give more careful consideration to energy supply issues.

The company has set itself the ambitious goal of achieving net-zero carbon emissions (reductions without the use of carbon offsets) by 2030. According to Otranto, Fortescue was able to launch its renewable energy and battery network earlier than planned, which shielded it from diesel supply shocks in March.

The company is expected to complete construction of its “green” grid in the Pilbara region by the end of 2028. It includes 1.2 GW of solar power, over 600 MW of wind power, and 4–5 GWh of battery storage.

By early 2027, Fortescue expects to complete the installation of 290 MW of renewable capacity to meet its ore processing needs, providing daytime “green” energy for all its operations in the Pilbara. The company also hopes the system will be able to operate 24/7 without fossil fuels by the end of next year.

As a reminder, in March of this year, Fortescue noted that iron ore companies risk incurring billions of dollars in additional costs if diesel fuel prices continue to rise.