Our path to net zero

There is little question about the need to address climate change.?But in the 30 years the world has been talking about what needs to be done, emissions have more than doubled. If we’re going to meet the Paris Accord of 2015, global emissions need to reduce by 7% every year for the next 30 years.

Reassuringly, change is happening. We’ve seen governments set more ambitious targets, and society at large is driving change by making targeted and informed decisions. The impact of ignoring this pressure is very real – companies?find themselves becoming less relevant, less profitable, less investable?and less valuable.?

Looking ahead,?the race to net zero will increase demand for our commodities. Copper, lithium, aluminium and minerals are the obvious ones.?But high-quality iron ore is also essential in?the drive to net zero. A large-scale move to renewable energy?will create additional demand for steel, for example, for the construction of wind turbines. Steel, particularly green steel,?has a bright future.?

However, while our business is essential to achieving net?zero, we cannot ignore that we are also a significant contributor to global emissions.?We must?take action?to address not?just?our own footprint but also find a way to help our customers and our customers’ customers to decarbonise.?We are already actively doing this and, since most?of them are in countries?with?their own net zero targets, it?has provided additional impetus to achieving this.?

While we do not extract fossil fuels and we have extensive hydropower for our most energy-intensive business, our aluminium smelters, we?can do a lot more?to address the climate challenge.?We must?seize?the initiative to drive decarbonisation across our business and value chains. We?will?do this?by working closely?with governments, suppliers, customers, communities, universities and?other partners.?

We will focus on three areas:

For one, we will?accelerate?our own?decarbonisation, switching to renewable power, electrifying processing and?running?electric mobile fleets.?

Secondly, we will increase?our?investment in R&D to?speed?up the?development of?technologies that will?enable?our customers?to?decarbonise. Clearly technology and partnerships have a key role to play.

Thirdly, we will prioritise growth capital in?commodities?that are essential for the?drive to net?zero.?We will look to grow?further?in copper, battery materials and high-quality iron ore.?We will also?target?our exploration spend to supplement?our?projects.?

I don’t expect everyone to take my assurances at face value. Many will be sceptical of a mining company’s ability to deliver on the climate front, beyond issuing ambitious and long-dated targets. It’s why we’re?sharing?a clear pathway to material reductions?by?the end of the decade.??

We know?this?will strengthen?Rio Tinto as a business. It also aligns?us with governments, customers,?suppliers?and consumers,?and secures?our long-term social licence.?And, it’s the right thing to do.

We will make Rio an even better company, doing our part to reach net zero.