APA says gas part of the energy mix for iron ore miners with ambitious decarbonisation targets

APA says a new solar farm and battery storage facility built to supply BHP is the first step and more will follow as it invests in renewables near existing gas-fired power stations.

APA solar farm and battery storage built to supply BHP's port operations.

APA says gas will always be an essential part of the energy mix for miners in the iron ore-rich Pilbara, where it has a $3bn growth strategy linked to the big miners with ambitious decarbonisation targets.

The gas pipeline owner said a new solar farm and battery storage facility built to supply BHP was the first step with more to follow as it invested in renewables near existing gas-fired power stations to ensure reliable energy supply.

APA plans to build solar farms and battery storage on big tracts of land it picked up in the $1.7bn acquisition of Alinta Energy’s Pilbara power network as miners like BHP, Rio Tinto and Fortescue grapple with how best to secure renewable energy supplies.

The 45 megawatt solar farm and 36.7MWh battery energy storage system connected to APA’s Port Hedland gas-fired power station will supply BHP’s port operations and are expected to slash emissions by half.

An aerial view of APA’s solar farm.

APA boss Adam Watson said the company had enough land at Port Hedland to increase capacity as the energy mix changed and miners struggling with the realities of building solar or wind farms on their tenements.

“This is one of the first projects that has been brought to market, and certainly the first one that is being successfully brought to market by bringing together solar and batteries outside of the miner’s land,” he said.

“We can effectively double it and probably double it again, so we can build this out over stages. That’s quite important because the customers aren’t yet ready to transition everything, and it goes to one of the big challenges for our customers in ensuring reliability. What we see in some ­regions is that mining customers want to be able to build a solar farm or a battery – probably not a wind farm as it takes up too much land – within their mining lease but that brings a lot of complications,” he said.

APA Group chief executiveAdam Watson.

APA’s biggest customers in the Pilbara are BHP, Gina Rinehart’s Roy Hill and Andrew Forrest-led Fortescue, and it is eyeing supply deals with Rio Tinto.

The West Australian government on Wednesday bestowed priority project status on APA plans to build transmission infrastructure in the Hamersley Range Corridor and the Burrup (Murujuga) Corridor to supply mining and processing industries in the Pilbara.

The Hamersley transmission lines will connect the Port Hedland and Newman power stations APA acquired from Alinta a year ago. The deal included a solar-gas hybrid power plant at Fortescue’s Chichester iron ore mine and the 11.8 per cent stake Alinta held in APA’s Goldfields gas pipeline.

Mr Watson said APA would look to build renewables assets on land at Port Hedland, Newman and Chichester, but said gas would remain part of the energy mix in the region even if miners succeeded in weaning themselves off diesel.

“Gas is always going to play a role in Pilbara. It’s always going to play a role in the WA market generally. It’s going to play a role across all of Australia because it is the most reliable, most efficient, lowest emissions, lowest cost way to complement renewables when the sun’s not shining and the wind not blowing,” he said.

The Port Hedland solar farm is on the cyclone-prone Pilbara and has been designed to withstand winds speeds of almost 300km/h.

BHP iron ore boss Tim Day said it would supply most of the day-time energy needs of port ­operations.

Originally published as APA says gas part of the energy mix for iron ore miners with ambitious decarbonisation targets