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Decarbonization targets

Leading the transition towards sustainable, low-carbon mining through our net zero strategy

Reduce scope 1 and 2 emissions by 33% by 2030 from the baseline year of 2017

Source 100% renewable electricity in Brazil by 2025 and globally by 2030

Achieve a 15% reduction in net scope 3 emissions by 2035, compared to the base year of 2018

Achieve net-zero Scope 1 and 2 emissions by 2050

Improve the global energy efficiency indicator by 5% by 2030.

Our 2030 target to reduce Scope 1 and 2 emissions by 33% is aligned with the Paris Agreement and its goal to limit global warming to below to 2°C (WB2D). This target is from a 2017 baseline of 12.2 MtCO₂e, and was set using a science-based methodology .

Vale’s decarbonization roadmap comprises a range of renewable energy projects that will ultimately supply 100% of our electricity requirement from sustainable sources. This will support our targets to achieve net-zero Scope 2 emissions in Brazil by 2025 and globally by 2030. In 2022, we sourced 99.95% renewable electricity in Brazil and 86.67% in our global operations a major milestone in our decarbonization efforts.

We are also working to reach net-zero emissions across Scopes 1 and 2 by 2050. We will achieve this by reducing our absolute emissions through decarbonization in our operations and by offsetting any residual emissions through carbon sequestration projects and high-quality carbon credits , all aligned with international best practices.

In 2020, Vale became the world's first mining company to establish a quantifiable target for Scope 3 greenhouse gas emissions, or emissions throughout our value chain. These emissions account for 98% of our overall inventory and reducing them will involve collaboration with our suppliers and customers.

We have pledged to reduce net emissions within this scope by 15% by 2035, from a 2018 baseline. This is similarly a science-based target that aligns with the 2°C global warming scenario. We will review this target in 2025 and periodically thereafter to ensure alignment with technological developments and evolving climate policies.

Decarbonization governance

To effectively manage the costs, risks, and opportunities associated with our decarbonization efforts, we have developed a roadmap with clear milestones to achieve our greenhouse gas (GHG) reduction targets. Vale’s decarbonization pipeline incorporates a diverse range of projects, each prioritized based on their cost competitiveness and contribution to our 2030 target.
We have also assessed our consolidated pipeline using the Marginal Abatement Cost Curve (MACC) approach to determine how different projects compare to each other on cost-effectiveness.
In addition, all investment decisions undergo an assessment to determine the associated shadow price of carbon (SPC). Ongoing portfolio evaluations help us to steer our course toward reducing GHG emissions while balancing costs, risks, and opportunities within our commitment timelines.

Scope 1: Risk and opportunity management using the Marginal Abatement Cost approach

Potential GHG reduction by type of initiative

   
Bioenergy
56%
Renewable electricity
18%
Natural gas and other
13%
Electrification
7%
Biodiesel and energy efficiency
6%
Total potential
100%
Within our project portfolio supporting our target 33% reduction in absolute emissions by 2030, renewable fuels and energy efficiency initiatives contribute to nearly two-thirds of our reduction potential. These are followed by renewable electricity (18%) and natural gas and other (13%) projects. We are concurrently exploring multiple solutions, including hybrid equipment.
 

Our emissions reduction strategy

In 2022, our Scope 1 and 2 (market-based) emissions were a total of 8.9 million metric tons of CO₂e, down 27% from a 2017 baseline. This reduction was primarily driven by decreased production volumes compared to 2017.
Scope 3 emissions were a total of 477.8 million metric tons of CO₂e in 2022, a reduction of 14% from a 2018 baseline primarily reflecting the lower sales volumes in the period. However, Vale’s most recent production and sales report anticipates an increase in production in the short term, which in turn will lead to higher emissions.

Breakdown of operational emissions (Scopes 1 and 2)¹

GHG Emissions by Source in 2022                             

Legends for graphs 1-a and 1-b:

1. Vale's 2022 GHG inventory was third-party audited.

2. Scope 2 location-based emissions were 0.6 million metric tons of CO2e, a 52% reduction compared to 2017.

3. Emissions from the 2017 baseline decreased from 13.5 million metric tons of CO2e to 12.2 million metric tons of CO2e, reflecting our divestments of coal, ferroalloy and manganese operations (except for our Simões Filho plant), the Midwestern System, and Vale Nickel (Dalian) Co. in 2022.

4. Land-use emissions and removals (LULUCF) do not include carbon stocks in the soil. In addition, land-use emissions include only cleared land owned or directly affected by Vale. We are constantly following trends in emissions reporting (GHG Protocol) to inform future improvements in our reporting practices.

Vale’s aggregate expenditure on climate change initiatives was USD 810 million from 2020 to 2022, with USD 543 million invested in 2022. We have a very strong track record in addressing emissions reductions, and plan to invest between USD 4 and 6 billion in a wide range of initiatives in our operations through 2030. See below our key initiatives by scope.

Energy consumption matrix by source 2022

Scope 1: fuel substitution and energy efficiency

Fossil feedstock substitution 

Our strategy for reducing Scope 1 emissions is primarily focused on replacing anthracite and natural gas in the iron ore pelletizing agglomeration process, reducing diesel consumption in mining equipment and locomotives, and displacing coal in our nickel flowsheets.

To lower anthracite emissions, we are developing a technology to replace it with biochar, a plant-derived product produced from certified biomass.

Natural gas and fuel oil are currently used as fuel in our blast furnaces. Vale is now exploring low-carbon alternatives, such as bio-oil or biomethane produced in biodigesters from landfill, agricultural and industrial waste.

In our railways, we are exploring a number of alternative fuels in replacement of diesel in our locomotives, including biodiesel, hydroprocessed vegetable oil (HVO), ethanol, and ammonia. Additionally, we are investigating the use of battery-electric locomotives to improve energy efficiency.

We currently use coal both as a fuel and as a reductant in our nickel processing plants in Brazil and Indonesia and we are investigating suitable alternatives. In 2023 we have conducted plant trials using thousands of tons of biomass-based products both in Sorowako (Indonesia) and Onça Puma (Brazil). The environmental impacts of any fuel switch will be fully evaluated before any large-scale adoption.

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Diesel substitutes for locomotives

Drop-in solutions

Biodiesel

Produced from: vegetable oils and animal fats

Challenge: regulatory (approval required for higher-than-mandatory blend ratios).

HVO

Produced from: vegetable oils, animal fat and hydrogen

Challenge: supply and cost constraints in Brazil

Retrofit solutions

Retrofit solutions: Ethanol

Produced from: plant-based raw materials

Challenge: technological (retrofitting required)

Ammonia

Produced from: an alternative fuel derived from hydrogen and nitrogen

Challenge: supply constraints
Most of Vale’s mine machinery runs on diesel. Available substitutes for diesel will vary depending on the site and can range from biofuels to electrification of some equipment.

Energy efficiency

Becoming more energy resource-efficient is a strategic priority for Vale. Energy efficiency features as one of the key levers in our decarbonization strategy and has played an important role in achieving emissions reductions, especially in the short term. Importantly, among the goals set by Vale, the company has committed to improving the overall energy efficiency indicator by 5% by 2030. 

Our goal is to systematically incorporate the topic into operational routines, encouraging operations to adopt initiatives that promote energy efficiency in their processes. 
 

One of our stand-out initiatives is Sentinela, a project that is leveraging artificial intelligence to optimize diesel consumption in off-road haul trucks by providing fuel-efficient speed setting recommendations for each section of the mine. 

In 2022, we piloted the AI tool at our Southern System mines and in 2023 we replicated the now-proven solution at our mines in Carajás and S11D. 

We are also exploring large energy efficiency solutions to our nickel processing plants in Brazil and Indonesia, such as better utilization of waste heat, increased water drainage in stockpiles before ore drying. 

Progress on our decarbonization journey

In 2023, we conducted a successful trial replacing up to 100% of anthracite feed with biochar in the pelletizing process at our Vargem Grande mine in Nova Lima (MG). In 2022, Vale entered into a contract for a natural gas retrofit at our São Luís pelletizing plant. Following the conversion, which we expect will be completed in 2024, all of our pelletizing plants will switch to using gas instead of fuel oil.

Also in 2022, we initiated pilot tests of two 72-ton battery-powered off-road trucks. These are the first to be used by a global mining company, emitting no CO2 during operation while also reducing noise and therefore minimizing impact on neighboring communities. Currently, emissions from diesel-powered off-road trucks account for approximately 9% of our total Scope 1 and 2 emissions. If the results are satisfactory, this solution could be extended to the company's other mines.

In May 2023, we signed an agreement with Wabtec to supply three 100% battery-electric locomotives that will be tested in hybrid trains on the Carajás Railroad. The idea is to couple the three 100% battery-electric locomotives to the current train operating model to support the train along the EFC and, in particular, on an approximately 140-kilometer uphill section of the railroad where fuel consumption is highest, forming the first hybrid train in the country. The agreement also calls for Wabtec to study and develop an ammonia-fueled engine as an alternative to diesel.

Scope 2: 100% renewable energy globally

Our decarbonization roadmap includes renewable energy initiatives aimed at meeting 100% of Vale's electricity requirement from renewable sources. This aligns with our goals to eliminate Scope 2 emissions entirely in Brazil by 2025 and in other countries by 2030.

As part of our strategy, we have built a strong portfolio of renewables over the years to meet our operational needs. We have also partnered with other players to expand our renewable generation capacity under power purchase agreements (PPAs) backed by renewable energy certificates.

Strategy to achieve Scope 2 target

Competitive renewable energy sources to support our decarbonization roadmap

Expansion of renewable generation capacity
Joint ventures to expand capacity
Power purchase agreements backed by renewable energy certificates
Innovation to improve battery efficiency

In 2022, electricity accounted for 30.2% of our energy consumption, with 86.67% sourced from renewables. In Brazil, this percentage is even higher, with 99.95% coming from renewable sources, supplied under concession contracts and power purchase agreements. This renewable energy is verified by certificates or generator declarations, and is third party-audited.

Our installed capacity was 2.7 GW in 2022, primarily consisting of directly and indirectly owned hydroelectric and wind generation assets in Brazil, Canada, and Indonesia, along with our new solar project, Sol do Cerrado. These facilities, on average, meet 61% of our global electricity requirement and 72% of our requirement in Brazil, contributing to our renewable energy commitment.

2023- 2030 Project

Notes: Emissions reduction based on 2017 baseline disclosed in Vale’s 2021 Integrated Report and data based on our 2022 decarbonization roadmap, which is updated annually and may impact progress on the target.

Electricity generation assets

Dams of International Hydropower Plants: 100% Vale

Indonesia: Larona, Balambano, Karebbe 
Canada: High Falls I, High Falls II, Big Eddy, Wabageshik, Nairn 

Installed Capacity: 57.4 MW

HPP HIGH FALLS I 

River: Spanish 
Installed Capacity: 10 MW 
Location: Greater Sudbury – Ontario 
Start of Operation: 1905 

HPP HIGH FALLS II

River: Spanish 
Installed Capacity: 8 MW 
Location: Greater Sudbury – Ontario 
Start of Operation: 1917 

HPP BIG EDDY

River: Spanish 
Installed Capacity: 30 MW 
Location: Greater Sudbury – Ontario 
Start of Operation: 1929 

HPP WABAGESHIL

River: Vermilion 
Installed Capacity: 4.8 MW 
Location: Greater Sudbury – Ontario 
Start of Operation: 1911 

HPP NAIRN
River: Spanish 
Installed Capacity: 4.7 MW 
Location: Nairn Township – Ontario 
Start of Operation: 1924 

Installed Capacity: 462 MW 

HPP Estreito

Concessionaire: Consórcio Estreito Energia (CESTE) 
Engie – 40.07% 
Vale – 30.0% 
Alcoa - 25.49% 
Intercement – 4.44% 
Location: Estreito - MA 
River: Tocantins  
Start of Operation: April/2011  
Concession End: Dec/2037 
Installed Capacity: 1087 MW 
# of Generating Units: 8 

HPP Carlos Ermírio de Moraes (Machadinho)

Location: Piratuba - SC 
River: Pelotas 
Start of Operation: Feb/2002 
Concession End: Dec/2028 
Installed Capacity: 1,140 MW 
# of Generating Units: 3 
Concessionaire: Consórcio Machadinho Companhia Brasileira de Alumínio - 29.2296% 
Alcoa Aluminio - 27.3391% 
Engie Brasil Energia - 20.4801%
Vale - 8.8068% 
Votorantim Cimentos Machadinho Energia - 5.9658% 
Machadinho Participações - 5.2762% 
DME Distribuição - DMED - 2.9020% 

HPP Risoleta Neves (Candonga)

Aliança Geração de Energia: 50.00% 
Vale: 50.00% 
Vale's Stake: 77.5% 
Location: Rio Doce - MG 
River: Doce 
Start of Operation: Sep/2004 
Concession End: May/2035 
Installed Capacity: 140 MW 
# of Generating Units: 3 

Sol do Cerrado
In November 2022, our Sol do Cerrado solar project came online in the municipality of Jaíba, northern Minas Gerais. This USD 590 million project is one of the largest solar plants in Latin America with an installed capacity of 766 Megawatts peak.

The project includes a substation and a 15 km, 230,000 volt transmission line connecting the plant to the Jaíba substation and ultimately the National Grid.

Sol do Cerrado will generate enough electricity to meet 16% of our electricity requirement in 2025, reducing our emissions by 134,000 tCO2e per year. This is equivalent to the emissions of approximately 100,000 compact cars.

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Installed Capacity: 462 MW 

HPP BATUBESI 

Basin: Rio Larona 
Installed Capacity: 195 MW 
Location: Balambano, Wasuponda 
Start of Operation: 1979 
# of Generating Units: 3 

HPP BALAMBANO

Basin: Rio Larona 
Installed Capacity: 137 MW 
Location: Balambano, Wasuponda 
Start of Operation: 1999 
# of Generating Units: 2 

HPP KAREBEE

Basin: Rio Larona 
Installed Capacity: 130 MW 
Location: Laskap, Malili 
Start of Operation: 2011 
# of Generating Units: 2 

Sol do Cerrado solar project

In November 2022, our Sol do Cerrado solar project came online in the municipality of Jaíba, northern Minas Gerais. This USD 590 million project is one of the largest solar plants in Latin America with an installed capacity of 766 Megawatts peak.

The project includes a substation and a 15 km, 230,000 volt transmission line connecting the plant to the Jaíba substation and ultimately the National Grid.

Sol do Cerrado will generate enough electricity to meet 16% of our electricity requirement in 2025, reducing our emissions by 134,000 tCO2e per year. This is equivalent to the emissions of approximately 100,000 compact cars.

In line with Vale’s commitment to promote a fair energy transition, we established a partnership with the municipal government of Jaíba and the local community to design a Local Development Agenda (ADL).

Among its key deliverables are the establishment of a diverse and representative permanent participation forum; the development of an integrated vision and shared governance; short, medium and long-term strategic planning; and investments in education and broad participation

Canada and Indonesia

Vale operates five small hydropower plants in Canada that generate approximately 20% of the electricity requirement of the company's Sudbury operations.

In Indonesia, we operate three hydroelectric power plants to supply electricity to our nickel production operations (Larona, Balambano, and Karebbe).

Scope 3: an enhanced portfolio and new technologies

Achieving our target 15% reduction in Scope 3 emissions by 2035 would avoid more than 80 million metric tons of CO2 equivalent in emissions. This poses the challenge of tackling emissions in hard-to-abate industries such as shipping and steelmaking, where the unavailability or high costs of retrofit and conversion technology mean that the shadow price of carbon cannot be estimated in regulated carbon markets.

Our efforts to meet these targets are anchored on three core pillars:

  • A high-quality product portfolio and innovative technology,
  • Collaboration and engagement with the value chain, and
  • Limited use of high-integrity carbon credits

We estimate that Vale’s initiatives will support approximately 15% to 25% of the reduction required to meet our Scope 3 target. The remaining reductions, around 75% to 85% of our target, will largely be achieved through collaboration with suppliers and customers, assisting them in innovation and decarbonization.

Around 17 MtCO2e of high-integrity carbon credits can be used toward this target up to a limit of 20% and provided those credits meet the requirements of additionality, permanence, transparency, and contribution to sustainable development.

Breakdown of 2022 Scope 3 emissions

Total: 477.8 million metric tons of CO2e

  • Processing of sold products
  • Investment
  • Upstream and downstream transportation and distribution
  • Other categories

Shipping decarbonization initiatives

Vale is leading efforts to decarbonize the maritime shipping industry through our EcoShipping program. We estimate that the transition to more sustainable fuels will generate emissions reductions as high as 40-80% for methanol and ammonia, and up to 23% for LNG.

Within this program, we have launched a number of innovative pilots, including ore carriers equipped with rotor sales and air lubrication. As significant milestones, we have recently introduced low-carbon fuels in our ships and secured Approval in Principle (AiP) from DNV, an internationally recognized accrediting body based in Norway.
 

The DNV-approved project will involve the installation of multiple fuel tanks on our ships, a significant step toward diversifying and making our maritime operations more sustainable. DNV has confirmed the technical feasibility of this system as an effective solution for storing alternative fuels such as LNG, methanol, and ammonia in the future.

In addition, Vale is currently installing LNG systems on many of our large ore carriers, preparing them for future eco-friendly operations. This will be preceded by a pilot on a Guaibamax carrier to test the new technology. This initiative reflects our ongoing commitment to find innovative and sustainable solutions to tackle environmental challenges in maritime shipping.

Learn more

Low-carbon solutions

To become a partner of choice in our customers’ decarbonization journey, we have advanced a unique, high-quality portfolio of low-carbon solutions.

For additional energy and emissions disclosures, see our ESG Databook.