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Rio Tinto has signed a 25-year deal to buy all power generated by the proposed 1.1 gigawatt Upper Calliope solar farm for its Gladstone alumina operations in Queensland.

The deal will see Upper Calliope become a core power source for Rio Tinto’s three Gladstone assets – the Boyne aluminium smelter, the Yarwun alumina refinery and the Queensland alumina refinery.

The plant will be built and operated by European Energy, at a site about 50 kilometres south-west of Gladstone, pending development and grid connection approvals.

Once approved and developed, Upper Calliope will have the potential to lower Rio Tinto’s operating carbon emissions by 1.8 million tonnes per year.

Rio said the agreement will bring more renewable power into one of Australia’s most important industrial hubs and marks another step towards the major miner’s climate goal of halving its global Scope 1 and 2 carbon emissions this decade.

“This agreement is a first important step in our work to repower our Gladstone operations and illustrates our commitment to keeping sustainably powered industry in central Queensland,” Rio Tinto chief executive Jakob Stausholm said.

“The task remains challenging, but we have a pathway to provide the competitive, firmed power our Gladstone plants need and we are continuing to work hard with all stakeholders, including the Queensland and Australian governments, on getting there.”

Construction of the Upper Calliope plant is targeted to start in 2025–26 and will aim to provide five per cent of Queensland’s current electricity demand.

The plant will employ 1000 people during construction and support 100 direct and indirect jobs when operating.

“Competitive capacity, firming, and transmission, are critical to developing a modern energy system that can ensure more large-scale renewables development in Queensland and help guarantee the future of Australian industry,” Stausholm said.