Exxaro, one of South Africa’s biggest diversified resources companies with a portfolio which includes coal, mineral sands and iron ore, is seizing the opportunities that climate change is presenting to them. This is evident in the mining group’s year-on-year improvement on its ranking in the annual Carbon Disclosure Project (CDP) results announced in December.
The CDP report ranked the JSE top 100 companies on two levels. A Carbon Disclosure Leadership Index (CDLI) judges companies on the levels of transparency and quality of disclosure of their greenhouse gas (GHG) emissions. A Carbon Performance Leadership Index (CPLI) ranks the companies in terms of their emissions reduction targets and progress in achieving these set targets.
Exxaro scored 94% in the latest CDLI, giving it a third position behind Goldfields and Nedbank. This was a 7% improvement from the 2010 CDP report – the company then scored 87% and held a joint fourth position on the rankings.
On the CPLI, Exxaro received a carbon performance score of an A- and is just behind the index leaders, British American Tobacco and Goldfields. In 2010 the company received a B. Besides Goldfields, Exxaro was the only other company from the energy and materials sector included in CPLI.
“This is fantastic recognition for all our efforts to reduce emissions and address climate change,” said the thrilled executive general manager for business growth, Ernst Venter.
According to Venter, the mining group recognised in 2007 that it had to deal with energy in its broadest context in order to remain competitive and sustainable for the benefit of all the companies’ stakeholders. “We have been working hard to address three key issues in today’s environment. The first issue is energy security, which means we have to ensure security of supply and have a reliable energy supply source. The second issue is economic productivity, which addresses growth in demand and price volatility. The last issue is environmental impact, which focuses on climate change, land and water use and carbon emissions.”
Exxaro has used a multi-faceted approach to deal with these challenges. The company formed a clean energy forum in 2007. This led to the formation of the energy and carbon management framework in 2008 and a climate change position statement was finalised in 2010. The mining group is also devising a climate change response strategy.
An energy-efficiency forum, consisting of representatives from each business unit, identifies risks and opportunities, shares knowledge and develops the best practices in executing energy-efficiency projects. Exxaro is also addressing energy-efficiency in production design. Examples of these can be found at the group’s new coal operations in the Limpopo province and in the low energy-use houses built by the company for its employees at these operations. The energy and carbon management framework has also seen the company’s general risk register being updated to take account of climate change risks.
Exxaro participates in the energy debate at a local, national and international level through membership of a variety of industry and global institutions. The group has also identified opportunities in strategic minerals such as titanium and copper. These strategic minerals are essential in the transition to a low-carbon economy.
In 2009 the mining group formed an energy company. Exxaro intends not only to generate power for Exxaro but also to supply electricity into the national grid, via a mix of renewable and cleaner energy sources in its road to carbon neautrality strategy.
“We are currently in a pre-feasibility phase for a 40MW wind farm at Brand-se Baai in the Western Cape and are partnering with a local comminity in Tsitsikamma to develop a 93MW wind farm”. Exxaro is also planning to develop a 30MW solar PV power plant in Limpopo.
Cleaner fossil fuels
The development of the first five-spot test for the coal-bed methane project in Botswana, with the aim of testing for economic gas flow, is progressing well.
Besides the development of stand alone electricity generation projects, Exxaro is also developing co-generation projects at its Namakwa Sands and Grootegeluk business units which are located in the Western Cape and Limpopo provinces. Once operational, these projects will dramatically reduce Exxaro’s Scope 1 emmissions.
Exxaro intends to reduce its Scope 2 emissions by developing a biofuels project in Mpumalanga. This project is aimed at generating biodiesel for the group’s own use, which will not only reduce the company’s carbon footprint but also mitigate exposure to rising fossil fuel derived fuel costs.
Exxaro is also actively pursuing Clean Development Mechanism (CDM) status. The company is proceeding with project validation and eventual certified emission reduction (CER) registration with the UNFCCC for a number of its clean energy projects.
“Our participation in the CDP has been a great opportunity to introduce processes to measure the company’s carbon emissions,” said Venter. “It provides valuable insight into the company’s overall emissions performance and allows for clear target setting.”
For more information on Exxaro’s energy and carbon management programme contact Willem van der Merwe.
Tel: +27 12 307 5000
Fax: +27 12 323 3400