Anglo American PLC (LSE:AAL) and EDF Renewables have signed a Memorandum of Understanding (MoU) to develop a regional renewable energy ecosystem in South Africa (SA) in support of the country's decarbonisation goals and its Just Energy Transition.
By 2030, the ecosystem will provide 100% renewable electricity to Anglo American's operations in SA, thereby supporting local energy supply systems and the wider decarbonisation of the energy supply in the country, Anglo American said in a statement.
It is estimated that 56% of Anglo American's global grid supply will be sourced from renewables by 2023 due to the company's use of 100% renewable electricity in South America.
The ecosystem is expected to attract equity financing from a number of partnerships above and beyond the typical debt financing associated with high-quality energy infrastructure projects, according to Anglo American.
Even though SA has an abundance of renewable energy sources, the infrastructure to harness them is limited. This partnership is designed to minimise Anglo American's current grid supply in SA, which is the largest source of its Scope 2 emissions as it approaches its 2040 objective of carbon neutral operations.
"We are targeting carbon neutrality across our operations by 2040 and we are making good progress," said Mark Cutifani, chief executive of Anglo American. "Step by step, we are changing the very nature of mining and how our stakeholders experience our business."
Bruno Bensasson, chairman & chief executive of EDF Renewables, said the project is in line with EDF Group's CAP 2030 strategy, which aims to double its renewable installed energy capacity worldwide, hydropower included, from 28 GW in 2015 to 60 GW.