PLS has signed a 20-year power purchase agreement to become the first external customer on Fortescue's Green Grid, connecting its Pilgangoora lithium operation in Western Australia's Pilbara to the network as the site enters a major expansion.
The agreement supports P2000, the expansion approved in mid-October that targets roughly 2 Mt/y of spodumene concentrate capacity. PLS expects unit operating costs to fall by about A$15-20/t ($10.5-14/t) against the cost base set at final investment decision once Green Grid supply starts. Power-related emissions intensity is projected to drop about 80%, from a FY23 baseline of 0.69 t CO2-e/MWh to roughly 0.13 by FY30.
Around A$150 million will fund the transmission connection and associated power infrastructure between FY27 and FY29, with more than 100 MW of capacity to support P2000 and future growth. PLS says the connection improves P2000 economics beyond the figures announced at final investment decision while providing capacity for later expansion. On-site generation and storage stay in service, with backup generation retained for reliability. Fortescue chief executive Dino Otranto called the deal an important first step in the company's move to become an energy supplier, saying a strong pipeline of other Pilbara operators is looking at the Green Grid. PLS managing director Dale Henderson said the agreement strengthens Pilgangoora's low-cost position through lithium market cycles.
Shared power infrastructure is becoming the template for remote mining regions, and this deal is the first proof the model sells beyond the builder's own fence line. For EPC contractors, the A$150 million connection package means transmission line and substation work, with more likely as that pipeline converts to contracts, since each new customer extends the grid and multiplies interconnection scope. Equipment vendors should note the standardization effect: one owner, one voltage and one spares pool across customers tends to consolidate procurement into fewer, larger orders for transformers, switchgear and protection systems. Twenty-year terms are what make these grids bankable, and they also anchor long-running maintenance, spares and refurbishment demand, including the rotating equipment and valve packages inside backup generation and water systems that remain on site. Operators from Chile to Africa watching Pilbara decarbonization will read this deal the same way lithium buyers do: proof the shared-grid model works commercially, not just technically.