Industry-first pilot for lower emissions copper market

BHP and Amazon have established an industry-first copper pilot to buy and sell credits for lower greenhouse gas emissions associated with copper concentrate and cathodes produced at Escondida – the world’s largest copper mine which sources its electricity demand from renewable energy and runs on desalinated water.

The Escondida copper mine supplies copper concentrates and cathodes to help meet global copper demand, which is developed into materials and products for uses like digital systems and energy infrastructure.

With buyers increasingly wanting to understand and influence the greenhouse gas emissions associated with the copper used in their products and infrastructure, this pilot aims to demonstrate a potential industry framework to purchase credits – Environmental Attribute Certificates (EACs)^ – that are only applied to emissions within copper supply chains.

The EACs are created by copper producers and sold to downstream users, recognising emissions reductions in the supply chain. Buyers can then retire these EACs against the greenhouse gas emissions of copper in their supply chain. Under this pilot, Amazon can retire the EACs against copper it uses in power, cooling and compute infrastructure – including the circuit boards, chips, interconnects, and cold plates which enable AI.

BHP Group Sales and Marketing Officer Michiel Hovers said he was pleased to work with Amazon on a first-of-its-kind initiative in the copper value chain to recognise and reward this aspect of environmental performance and product transparency.    

“As global copper demand grows, customers and end users of copper are increasingly focussed on security of supply and increasingly looking to source credible, verifiable, sustainable attributes,” he said.

“This pilot could help develop a practical pathway to connect lower emissions copper producers with end users of copper who want credible and verifiable lower emissions materials – like Amazon, whose cloud infrastructure uses copper in a diverse range of applications with complex supply chains.”

It is difficult for a physical tonne of copper to carry clear environmental information all the way through the supply chain because it moves through multiple stages of smelting, refining, fabrication and manufacturing before it reaches the end user. 

This pilot with Amazon is an example of what a credible framework to create EACs for copper could look like, that is one which can be verified, traced and registered to safeguard against double counting.

The pilot aims to help the industry develop a future market for lower emissions copper EACs by exploring eligibility criteria, a governance framework, and safeguards against potential double counting.

^ Environmental Attribute Certificates (EACs): This system BHP and AWS are piloting is known as “in-setting” rather than “off-setting” because the credits are only applied to emissions in copper supply chains: https://rmi.org/resources/turning-buyer-demand-into-low-carbon-copper-production/