Several mining companies have started buying renewables to offset their operations as pressure from financing companies and shareholders.

BHP recently also announced the purchase of renewables to power its Olympic Dam copper and uranium mine in South Australia, but the decision by a coal company, even one involved in metallurgical coal for steel making, is significant in its symbolism.

Lobby group Solar Citizens said it was another big win for renewables and pointed to Rio Tinto’s call earlier this year for proposals to support 4000 megawatts of new renewable energy generation to power their smelter and refineries.

The announcement was made at the opening of a centre of excellence for hydrogen, a gas that is expected to eventually help decarbonise economies and lower the use of coal in energy and potentially steel production.

Renewables are also making more sense, even for coal companies, which predominantly use diesel in their operations.

Diesel has become significantly more expensive since the trade embargos were placed on Russia, which is one of the world’s biggest exporters of diesel.

However, the Anglo deal is massive. At $1 billion over 10 years it is Stanwell’s biggest ever retail deal and follows the announcement this week that Brisbane Airport would buy 185GWh  from Stanwell to offset its operations.

The deal was linked to the generation of electricity from the Clarke Creek wind farm and the Blue Grass solar projects. It would power the equipment at the mines including the draglines and coal preparation plants and longwall equipment.

Anglo chief executive Dan van der Westhuizen said the deal would effectively remove scope 2 emissions. The scope 3 emissions from the burning of the coal, are by far the largest, but are generally considered to be an issue for the country that buys the coal.

Van der Westhuizen said the company believed coal used in steel production was still crucial to the world but deals like this one would help underpin new renewable projects.

Energy Minister Mick de Brenni said it was clear that boardrooms and consumers around the world were setting their own emission reduction targets on producers like Anglo.

“We know their customers around the world are demanding a low emissions product. Because of our energy and jobs plan and because of the public ownership of Stanwell we can guarantee firm, reliable, renewable energy at an affordable price.”

“The resources sector in Queensland is responsible for about 11 per cent of the state’s emissions. This deal between Anglo American and Stanwell Corporation will start putting downward pressure on those emissions from our resources sector.

“That means the coal mined here for steelmaking will remain extremely attractive on the global market.”

Stanwell’s Michael O’Rourke said the 10-year, 94 megawatt deal included enough energy to power 150,000 houses a year.

Solar Citizens deputy director Stephanie Gray said the Queensland Government’s adoption of a more ambitious renewable energy target, alongside investment in grid infrastructure, was helping to underpin these announcements and drive more regional economic activity.

“But the scale and speed of the announcements we’re seeing from industry and business goes even further than the State Government’s plans, so they have a task ahead of them to keep up with demand.

“A total of 3800 MW of new large-scale renewable energy is likely to come online in Queensland by 2025. But we’re going to need a lot more renewable energy connecting to the grid over the next few years to help drive down power bills for Queenslanders while meeting the needs of the business sector.”