Rio Tinto’s giant Queensland bet on Andrew Forrest wind farm

But Rio’s chief executive, Jakob Stausholm, said the two big deals still left Australia’s largest aluminium producer a long way short of being able to completely decarbonise its extensive assets in energy-intensive industry, with more than 4 gigawatts of firmed wind and solar energy required to achieve that for the Gladstone operations alone.

“Aluminium production is probably the most energy-intensive activity on the planet. And that’s why it’s we have now announced firm deals to build Australia’s biggest two biggest renewable farms, one on solar and one on wind, and it’s still not enough,” Mr Stausholm told The Australian Financial Review.

“But the problem is the next step now as we need to find a solution with the Queensland government and the Commonwealth on how to firm it because, ultimately, a smelter cannot live by solar or by wind or the combination. It needs to have 24/7 electricity, and we have now made firm commitments of several billion dollars, so we now need to get this landed. Otherwise, we can’t do more.”

Mr Stausholm said Rio also needed access to competitively priced power to be able to compete in international commodity markets, and was considering all options such as batteries and the pumped hydro storage projects being developed in Queensland. He said Rio was working with governments to try to find the best solution to the dilemma.

“We are working with them to try to find a solution that’s competitive. You have to bear in mind that aluminium is fundamentally employment in Australia, but export out of Australia, and therefore we have to be able to compete. So we have to have all in, firmed electricity prices at an international competitive price.”

Once approved, construction of the Bungaban project is targeted to start in late 2025 and is expected to produce electricity by 2029, employ up to 600 people during construction and support up to 30 permanent jobs when operating.

Windlab chief executive John Martin said: “Securing this PPA is a major milestone for the Bungaban project and a strong signal of the project’s value from the market.”