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Without naming names, Andrew Forrest has engaged in an eye-popping exercise of environmental competitor shaming in announcing an emissions target that leaves his rivals in its dust.
And for the avoidance of any doubt, its BHP and Rio Tinto’s less aggressive emissions targets that will be shown up by the iron ore billionaire’s declaration on Tuesday that his empire will be net zero by 2040 - that includes Fortescue’s own emissions plus those generated by the iron ore it sends to its customers.
Is Forrest aspiring to be the Elon Musk of the iron ore/steel sector? Will he be to BHP and Rio what Tesla has been to General Motors and Ford - the disruptor that changed the convention business model?
Foretestcue Metals chairman Andrew Forrest. Credit:Andrey Rudkov/Bloomberg
BHP’s view is that steel production will still be mostly fuelled by coal by 2050 - albeit less than it is today.
But Forrest is sanguine that by 2050 coal will be history, replaced by clean fuel -most likely hydrogen - as the key energy source for steel making. It’s a massive prediction - and the result could go either way.
Forrest’s Fortescue Metals has its fair share of fanboys from the ever swelling numbers in the environmental movement. That said, BHP looks likely to receive general, albeit conditional, support for its current emissions reduction trajectory as it heads to its annual meeting this month.
But Forrest’s proclamations have set Fortescue wildly apart from the pack on environmental issues. The billionaire has in recent years morphed into something of an environmental/climate evangelist - labelling his competitor’s aspirations on emissions as greenwashing and their promises on the environment as sugar hits with no real substance.
On Tuesday, Fortescue formally set out its own ambitious emissions pledges, and these involve an extreme makeover of the steel industry. Ditching coal from the steel manufacturing process is as radical as removing the internal combustion engine from cars.
Unlike Rio and BHP, who have set off on a more conventional path to reduce their emissions, Forrest wants to essentially blow up the traditional model of using coal to fire steel making furnaces.