Anglo American Platinum Secures Renewable Energy Deal with Envusa Energy

Anglo American Platinum Limited has announced a significant milestone in its sustainability journey by entering into a 20-year Energy Offtake Agreement (EOA) with Envusa Energy Proprietary Limited. This agreement marks a strategic move towards decarbonization and ensuring sustainable operations for the company’s Rustenburg Platinum Mines Limited (RPM) subsidiary.

Renewable Energy for Sustainable Operations

Under the terms of the agreement, Envusa Energy, a joint venture between EDF Renewables and Anglo American plc, will supply RPM with approximately 460 MW of renewable energy generated through solar and wind projects. This renewable energy will be sourced via the Eskom electricity grid, providing a clean and sustainable power source for Anglo American Platinum’s operations.

Key Points of the Agreement

• Project Timeline: Construction on the Koruson 2 solar and wind projects, which will generate the renewable energy, is set to commence in 2024, with commercial operation expected by 2026.
• Financial Structure: Envusa Energy subsidiaries will own and operate the Koruson 2 projects, with funding from both shareholders and external lenders.
• Decarbonization Commitments: The agreement aligns with Anglo American Platinum’s commitment to reduce greenhouse gas emissions by 30% by 2030 and achieve carbon-neutral operations by 2040, supporting its Environmental, Social, and Governance (ESG) leadership priorities.

Benefits for Anglo American Platinum

Craig Miller, CEO of Anglo American Platinum, highlighted the significance of the agreement, stating, “The conclusion of the EOA with Envusa Energy to secure clean energy for our operations is a significant milestone in our journey towards our decarbonisation commitments, ensuring that our PGM metals are produced in a safe and sustainable manner.”

Market Practice and Tariffs

The tariff for the renewable energy supplied by Envusa Energy is in line with market practices for Independent Power Producers. It takes into account capital investment costs, operating expenses, and expected equity returns for the project. Notably, Anglo American Platinum stands to benefit from approximately 30% savings on the EOA tariff compared to current Eskom tariffs.

Ensuring Corporate Governance

The agreement underwent rigorous corporate governance processes, including engagement with the Johannesburg Stock Exchange (JSE) and approval by independent non-executive directors. Independent technical and financial advisors were also consulted to ensure the competitiveness and viability of the projects proposed under the EOA.

Conclusion

Anglo American Platinum’s partnership with Envusa Energy underscores its commitment to sustainability and responsible business practices. By embracing renewable energy, the company not only reduces its environmental footprint but also contributes to the broader goal of transitioning towards cleaner energy sources in South Africa.