JSE-listed coal-mining company Exxaro intends forming a clean-energy company in which it will raise funding for clean-energy projects with strategic partners, Exxaro Executive GM business growth Ernst Venter said on Thursday.

Venter said in reply to Deutsche Bank mining analyst Tim Clark that its energy business model was entirely different to its coal business model.

He said that the equity stake that Exxaro would have in its new coal projects going forward would probably continue to be 100%, whereas it was building up a portfolio of clean-energy projects and the funding for these was likely to be raised by the clean-energy company, in which it would have the majority stake and which it would manage. It would find strategic equity partners for the projects.

"It's all about strategic alliances, partners and not going it alone as far as clean energy is concerned," Venter said.

The renewable energy feed-in tariffs (refit) for wind energy had made wind-energy projects "quite attractive". The refit tariff for wind energy is R1,25/kW.

Exxaro CEO Sipho Nkosi told Mining Weekly Online in a video interview that it would be inappropriate for Exxaro to be producing coal at the expected level of 80-million tons a year to 90-million tons a year in the next ten to 15 years and have done nothing about clean power.

"That's why it's critical for us to participate in renewable energy, because we believe it is very important," Nkosi said.

He added that each country required diverse forms of energy and South Africa had to go that route as well.

Environmental pressures would be exerted in the future, which was why the company had decided to respond to overtures by the Norwegian and Danish governments.

"Whether we like it or not, clean power is the big issue going forward," Nkosi added.

South Africa's coal products would become competitive only if the country struck a balance between coal and renewables.

Exxaro is part of the Tsitsikamma community wind farm consortium, which plans to generate 40 MW of wind power by 2013, from a R1-billion project in the Eastern Cape. That consortium includes the Tsitsikamma Development Trust, Watt Energy and the Danish Industrialisation Fund for Developing Countries and Danish power producer European Energy,

It is also investigating the feasibility of constructing a 100-MW wind farm at Brand-se-baai in the West Coast.