PLS has signed a 20-year power purchase agreement (PPA) with Fortescue to secure lower-cost electricity for its Pilgangoora Operation in Western Australia. The agreement is expected to reduce operating costs, lower power-related emissions intensity and provide additional electricity capacity to support the operationโs planned expansion.
The Pilgangoora power agreement will connect to Fortescueโs Green Grid, with electricity from the network supplementing the power already generated and stored on site. Backup generation will remain available to support operational reliability.
Once electricity supply begins, PLS expects P2000 unit operating costs to decline by approximately USD 15โ20 per tonne compared with the cost base announced at the projectโs Final Investment Decision (FID). The arrangement is expected to improve the operationโs long-term cost position as production capacity increases.
Power Agreement Supports P2000 Expansion
The agreement forms part of PLSโs broader Pilgangoora Power Strategy and follows approval of the P2000 Project. The expansion is expected to increase spodumene concentrate production capacity at the operation to approximately 2 million tonnes per annum (Mtpa).
To establish the connection, around AUD 150 million will be invested in transmission infrastructure and associated power facilities between FY27 and FY29. The connection will provide more than 100 MW of transmission capacity, supporting the P2000 expansion and allowing for potential future growth.
The additional supply is intended to complement existing on-site power generation and storage rather than replace the operationโs backup arrangements. This combination is expected to provide the electricity capacity required as Pilgangoora expands.
Emissions Intensity Expected to Decline
The agreement is also expected to contribute to a substantial reduction in Pilgangooraโs power-related emissions intensity. PLS projects a decline of approximately 80% by FY30, from the FY23 baseline of 0.69 tonnes of carbon dioxide equivalent per megawatt-hour (tCOโ-e/MWh) to approximately 0.13 tCOโ-e/MWh.
The lower emissions intensity is linked to the increased supply of electricity through Fortescueโs Green Grid. Alongside the expected reduction in power costs, the Pilgangoora power agreement is intended to strengthen the operationโs cost competitiveness and support its longer-term expansion plans.
PLS Managing Director and Chief Executive Officer Dale Henderson said the partnership would improve the operationโs position as it moves into its next phase of growth.
โWe are pleased to partner with Fortescue and become their first external Green Grid customer. We commend Fortescue’s leadership in bringing its vision for large-scale, lower-emissions power infrastructure across the Pilbara to life and strongly support the opportunity for shared infrastructure to benefit industry across the region.
“This agreement further strengthens our low-cost position at Pilgangoora, improving our competitiveness and resilience through lithium market cycles.
Access to lower-cost, lower-emissions power will deliver further improvements to the economics of our recently approved P2000 expansion, beyond those announced at FID, while providing capacity to support future growth.