Collie's proposed 460,000t steel mill locks in BHP renewable deal

Generation Steel announced on 25 October that it has signed a binding power purchase agreement with BHP to supply renewable electricity to its proposed Collie Steel Mill, a deal the company says locks in solar and wind power for the project before a single piece of steel is made.

Why it matters

The agreement, announced on 25 October via Medianet, ties BHP’s WA Nickel business to the proposed electric arc furnace plant through its commercial energy and utilities arm. For south-west builders and suppliers it is an early signal the project is moving, though no cost, jobs or start date has been released.

Generation Steel executive director and co-founder Rajan Aggarwal said the deal secured renewable supply before the mill is even built. “Being powered entirely by renewable energy from day one is a defining moment for Generation Steel,” he said. BHP’s side of the deal was handled by Rob Whitham, the company’s WA Nickel manager for commercial energy and utilities.

The numbers

Generation Steel says the proposed electric arc furnace plant is designed to produce 460,000 tonnes of construction steel products. An electric arc furnace melts its feed with electricity rather than coal, which is why the power contract comes first. The power purchase agreement itself is described only as drawing on operating solar and wind generation sources, with no specific wind or solar farm named in the announcement.

The company has not put a dollar figure on the Collie project, nor released a construction timeline or workforce estimate alongside the energy agreement. Generation Steel said further details of the mill would be released separately, without giving a date.

What’s next

The Collie mill remains at the proposal stage. Generation Steel and BHP have not said when the renewable power arrangement would begin supplying the plant, which is contingent on the mill itself proceeding to construction. The company has flagged that a fuller project update, covering scope and cost, is coming but has not said when.

The deal adds to a run of major project announcements across Western Australia this year, including the new terminal planned for Perth Airport. For Collie, a renewable-powered steel mill would mark a new industrial use for the south-west town. Generation Steel has not set a date for a final investment decision on the plant.