Incentives lure mining firm Exxaro into sector

SOUTH AFRICA: South Africa's fourth-biggest coal producer Exxaro is moving into clean energies, encouraged by the government's proposed tariff and environmental reasons.

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South Africa has the thirteenth-highest carbon dioxide emissions in the world due to its heavy reliance on coal. It also has an ever-widening power deficit, which has resulted in rolling power cuts. The government announced a generous tariff for wind last year but details are still being worked out.

Exxaro's executive general manager of business growth, Ernst Venter, says sustainable energy supply is of the utmost importance to sustain economic growth. The firm also wants to reduce its carbon footprint and secure its own energy supplies. "We can clearly see a space for renewable independent power producers in Southern Africa and we believe that we are well positioned to capture some of that space," he says.

The company is building a portfolio of wind, solar and co-generation projects, with the aim of having 500MW of wind power capacity by 2020. One project it is considering is a 100MW facility at Exxaro's Namkawa Sands mine in Western Cape Province, north of Cape Town.

The company is also a member of the consortium developing the 40MW Tsitsikamma Community Wind Farm in Eastern Cape Province (see page 58). Exxaro is likely to look for equity partners to help finance the projects and will set up a separate company to manage them.

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