Rio Tinto, one of the world’s largest mining companies, has been intensifying its efforts to cut carbon emissions and achieve net zero by 2050. Through its 2025 Climate Action Plan, the company outlines key initiatives to decarbonize operations and cut emissions with plans to use carbon credits to meet its 2030 climate targets.
Rio Tinto plans to spend $589 million on decarbonization in 2024. This shows the company’s strong commitment to sustainability. They are also tackling the challenges of carbon-heavy mining operations.
Reducing Operational Emissions: Scope 1 and 2
Rio Tinto has committed to reducing net Scope 1 and 2 emissions by 50% by 2030 and achieving net zero by 2050.
In 2024, its gross operational emissions dropped to 30.7 Mt CO2e, down from 33.9 Mt CO2e in 2023, according to the miner’s 2025 Climate Action Plan. This progress comes mainly from new contracts for renewable electricity and projects that reduce emissions.
The company is targeting three major areas to cut emissions:
- Renewable Energy Transition: Rio Tinto has increased its electricity consumption from renewables to 78% in 2024, up from 71% in 2023, with a goal of surpassing 90% by 2030. The company signed 2.2GW in renewable energy PPAs for its aluminum smelters in Australia. This will greatly cut emissions from electricity use.
- Electrification of Mining Operations: Rio Tinto is working with industry partners like Caterpillar and Komatsu to develop battery-electric haul trucks. It has also transitioned 100% of its heavy mining equipment at the Kennecott mine to renewable diesel.
- Alumina Refining and Processing Efficiency: The company is testing hydrogen calcination at its Yarwun refinery. It is also using new digestion technologies at Queensland Alumina Limited. These efforts aim to cut process heat emissions.
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Decarbonizing the Value Chain: Scope 3 Emissions
Rio Tinto prioritizes cutting emissions from its operations. Yet, it is also teaming up with partners to reduce Scope 3 emissions, which reached 574.6 Mt CO2e in 2024. The largest contributor is the steel industry, where the company is focusing on various strategies to drive reductions.
One of the main initiatives is the development of low-carbon steelmaking technologies, such as BioIron™ and electric smelting. These innovations aim to replace traditional blast furnaces, which are highly carbon-intensive. Cleaner alternatives use hydrogen or renewable electricity.
By advancing these technologies, the Australian miner hopes to significantly reduce the emissions generated during steel production. It remains one of the largest industrial sources of CO2 globally.
In addition to technological innovation, Rio Tinto is actively partnering with 50 of its highest-emitting suppliers. The goal is to improve energy efficiency and reduce emissions across the supply chain.
Investment is also a key component of Rio Tinto’s Scope 3 reduction plan. The company has committed $200-350 million between 2025-2027 in steel decarbonization initiatives. The funding supports research, pilot projects, and industrial-scale adoption of low-carbon steelmaking methods.
Despite these efforts, reducing Scope 3 emissions remains a significant challenge. Much of the company’s impact depends on external factors. These include the speed at which customers and partners adopt new technologies, government regulations, and broader market demand for low-carbon materials.
The Role of Carbon Credits in Rio Tinto’s Net Zero Strategy
Rio Tinto is using high-integrity carbon credits to support its net zero strategy. This approach complements direct emissions reductions. The company will limit carbon credit use to 10% of its 2018 emissions. This keeps the main focus on reducing actual emissions.
Rio Tinto’s carbon credit strategy includes:
- Nature-Based Solutions: The company is focusing on reforestation and conservation in Madagascar and Guinea. This will create high-quality carbon credits.
- Carbon Capture and Storage (CCS): The company is looking into CCS to reduce emissions from aluminum smelting. They have teamed up with Carbfix to inject CO2 into geological formations.
- Australian Carbon Credit Units (ACCUs): Rio Tinto uses ACCUs to comply with Australia’s Safeguard Mechanism.
Strategic Use of ACCUs in Emission Reduction
Australian Carbon Credit Units play a critical role in Rio Tinto’s emissions reduction strategy. The Safeguard Mechanism in Australia requires large emitters to stay within set limits for net emissions. Companies can use ACCUs to offset any emissions that exceed these limits.
Rio Tinto uses ACCUs as a compliance tool. They also help with wider environmental goals. The company is actively buying ACCUs from verified projects. These include reforestation, soil carbon sequestration, and savanna fire management initiatives. These credits help the company reduce emissions. They also support biodiversity conservation and Indigenous-led land management projects.
However, Rio Tinto’s reliance on ACCUs is carefully managed. The company focuses on cutting actual emissions, with ACCUs serving as an extra measure.
Rio Tinto’s capping ACCU use at 10% of its 2018 emissions baseline shows a real commitment to decarbonization, not just relying on offsets.
Navigating Challenges on the Path to Net Zero
Despite making significant progress, Rio Tinto faces several challenges in reaching net zero. The group has the following roadmap to 2050:
One of the key obstacles is the slow deployment of new technologies. The company knows that it will take time for battery-electric haul trucks and low-carbon steelmaking technologies to be widely adopted.
Additionally, rising carbon prices are expected to pose financial challenges, with penalties and compliance costs likely to increase in the coming years.
Regulatory uncertainty makes it harder for Rio Tinto to decarbonize. Global rules on carbon pricing and offset mechanisms vary a lot. This creates a confusing policy landscape. Another major challenge is ensuring the integrity of carbon credits.
As the carbon market expands, concerns over the quality and credibility of offsets continue to grow. Rio Tinto needs to invest in high-quality projects. These projects must be verifiable and provide real environmental benefits to help maintain trust and effectiveness.
Rio Tinto is making real strides toward its net zero goals. The giant miner is investing heavily in renewables, electrification, and projects to cut emissions. Using carbon credits, especially ACCUs, is a backup plan: real emission reductions stay the main focus. By balancing internal decarbonization with carefully managed carbon offsets, Rio Tinto is positioning itself as a leader in sustainable mining.
