Rio Tinto Ltd (ASX: RIO) shares are in the green today.
Shares in the S&P/ASX 200 Index (ASX: XJO) mining giant closed yesterday trading for $115.99. In morning trade on Friday, shares are changing hands for $117.74 apiece, up 1.5%.
For some context, the ASX 200 is up 0.2% at this same time.
This comes as the iron ore price edged up 1.5% overnight to US$102.20 per tonne, and amid news of a major renewable energy agreement.
Here's what's going on with Rio Tinto shares.
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Rio Tinto shares increase renewables exposure
On Thursday afternoon, the ASX 200 miner reported that it had signed a "landmark" solar and battery agreement with Edify Energy for Rio Tinto's Gladstone aluminium operations in Queensland.
Rio Tinto shares will increase their renewables exposure, with the miner announcing it will purchase 90% of the power and battery storage capacity generated by the Smoky Creek & Guthrie's Gap Solar Power Stations for 20 years.
Edify Energy will build, own, and operate the projects. Construction is slated to begin in late 2025 and expected to be completed in 2028 in a deal that The Australian Financial Review noted will support $2 billion of investments in solar farms and batteries in the state.
The power stations will provide a combined 600MWac of solar and 600MW / 2,400MWh of battery storage.
This is in addition to the 2.2 gigawatts (GW) of renewable wind and solar power purchase agreements Rio Tinto announced for its Gladstone operations in 2024.
The ASX 200 miner said its 90% share of the Smoky Creek & Guthrie's Gap battery system will provide about 30% of the firming required to repower the Boyne smelter with renewable energy. It will store green energy for reliable use during peak demand periods or low solar output.
What did management say?
Commenting on the renewables energy increase that could support Rio Tinto shares over the long term, Rio Tinto CEO, Australia, Kellie Parker said, "These agreements are integral to repowering our Gladstone aluminium operations with affordable, reliable and lower carbon energy for decades to come."
Parker continued:
For the first time, we have integrated crucial battery storage in our efforts to make the Boyne aluminium smelter globally cost-competitive, as traditional energy sources become more expensive.
We continue to investigate further renewable energy investments to repower our Gladstone aluminium operations.
Edify Energy CEO John Cole added:
This collaboration is an important commitment to supporting the sustainable future of Australia's industrial sector. We are proud to advance Rio Tinto's goals to repower its Gladstone operations and to play a role in the transition to a low-carbon economy.
With today's intraday gains factored in, Rio Tinto shares are down 1% since this time last year.
