The strategic deal will help reduce greenhouse gas emissions
A significant deal with Queensland’s state-owned clean energy company, CleanCo, will enable BHP to substantially reduce greenhouse gas emissions from its Queensland coal operations.
Baker McKenzie's renewables team assisted CleanCo with the deal. Partners Tanya Denning and Aylin Cunsolo led the Baker McKenzie team, from the Brisbane and Melbourne offices, respectively.
"This transaction supports projects which will create high-quality jobs in Queensland, as well as take tangible steps to safeguard Queenslanders' future by supporting the transition to renewable energy," Ms. Denning said.
"This transaction demonstrates the Queensland Government's role as a crucial participant in the State's growing renewables market, and Baker McKenzie is delighted to support our client CleanCo from our office in Brisbane, in close collaboration with our national renewable energy team."
Under the five-year deal, CleanCo will provide BHP with electricity primarily from renewables sources sufficient to provide half the power BHP requires for its coal mines in Queensland.
This will lead to a substantial reduction in greenhouse gas emissions that would otherwise be produced, given that BHP currently sources 100 per cent of electricity supply from the largely coal-fired Queensland grid. BHP estimates there will be an overall reduction of 1.7 million tonnes in carbon equivalent emissions between 1 January 2021, when the supply agreement kicks in, and 2025.
Baker McKenzie advised CleanCo on the retail contract, which will provide BHP with electricity and large-scale generation certificates (LGCs).
"This agreement is an example of a contractual structure that has evolved to support businesses to transform their impacts on climate change, through reducing their greenhouse gas emissions from the electricity they use, while also realising financial benefits," Ms. Cunsolo said.