NAMIBIA LEADS ENERGY TRANSITION IN AFRICA
Namibia is leading on the continent in the transition from fossil-based energy production and consumption to renewable sources, with solar and wind now accounting for 25% of the country’s power source, latest statistics reveal.
According to the latest Global Electricity Review undertaken by Ember, Morocco and Kenya come after Namibia at 17% and 16% respectively, while the rest of the African countries fall below the global benchmark of 12%.
The Review provides the most transparent and up-to-date overview of changes in global electricity generation in 2022 and a realistic summary of how “on track” the electricity transition is for limiting global heating to 1.5 degrees.
The report analyses electricity data from 78 countries representing 93% of global electricity demand and includes estimated changes in the remaining generation. It also dives deeper into the top 10 carbon dioxide (CO2) emitting countries and regions, accounting for over 80% of global CO2 emissions.
Ember says wind power produced 7.6% (2,160 TWh) of global electricity in 2022. China is the biggest generator of wind power at 824 TWh, (9.3% of its electricity mix), while Denmark has the highest wind generation by percentage share at 55% (19 TWh). Germany has both the third highest generation of any country (126 TWh) and the sixth highest share in the mix at 22%.
Namibia’s ranking cements the country’s efforts toward attaining the national goal of being a self-sufficient power producer and going green.
Such efforts are spearheaded by NamPower through its Integrated Strategy and Business Plan (ISBP) for the 2020– 2025 period and in line with the Ministry of Mines and Energy determination on generation capacities towards the fulfilment of national policies’ goals outlined in the National Integrated Resource Plan (NIRP) for the electricity sector, as well as the fifth National Development Plan.
NamPower is targeting to produce 220MV of power by 2025 through internal solar power generation including Independent Power Producers (IPPs). This comes as Namibia is embarking on Green Hydrogen projects that are also expected to push the country’s power generation capacity further into renewable energy.
According to Ember, wind and solar are the new energy superpowers.
“They (wind and solar) are pushing us towards a new era of falling fossil generation, which will mean not only a phasedown of coal power but also of gas power. But we’re not there yet,” the report says.
“Keeping global heating to 1.5 degrees means delivering on the huge expectations set for wind and solar, and picking up speed on other clean electricity sources (including nuclear and hydro) that are currently being built too slowly. There remains much work to be done to achieve the rapid falls in power sector emissions needed this decade.”
The report indicates that the carbon intensity of global electricity generation fell to a record low of 436 gCO2/kWh in 2022, the cleanest-ever electricity. This was due to record growth in wind and solar, which reached a 12% share in the global electricity mix, up from 10% in 2021.
“Together, all clean electricity sources (renewables and nuclear) reached 39% of global electricity, a new record high. Solar generation rose by 24%, making it the fastest-growing electricity source for 18 years in a row; wind generation grew by 17%. The increase in global solar generation in 2022 could have met the annual electricity demand of South Africa, and the rise in wind generation could have powered almost all of the UK,” the report reads.
This comes as Envusa Energy, a special-purpose vehicle owned by Anglo-America and EDF-Renewables, is planning to construct a 34-megawatts (MW) wind farm at an estimated investment cost of N$922 million (US$51 million) in Namibia, with Namdeb as the off-taker.
Namibia has attracted potential investment worth N$161 billion as of March 2023, with a potential to create 122,000 new jobs in the country, Namibia Investment Promotion and Development Board (NIPDB)‘s Chief Executive Officer and Chairperson Nangula Uaandja has revealed.
About a quarter of the investments, valued at N$38.8 billion, are at implementation stage, while about 60% valued at N$95.3 billion, are still pending.
“Our pipeline is worth N$161 billion as of March 2023, and it is in various stages, the ones that have become operational are worth N$2.8 billion. Where capital has started to flow are valued at N$24.1 billion and investments have started in the country,” she said as part of an update of the trade facilitation organisation’s 500 days of existence, as detailed in their maiden annual report.
She added that the pipeline only represents the value of private projects that were facilitated by the NIPDB.
“All our efforts are contributing to improving the general economic environment were many other investments are talking place without the support of NIPDB and are not included in the pipeline,” NIPDB’s CEO said.
Uaandja mentioned that some of these are new investments, others are business rescues where one project was about to close and then NIPDB worked together with government entities to save the project to protect jobs, and others are mergers and acquisitions.
According to their annual report, based on the multiplier effect, these investments are expected to generate a total of 122,000 new jobs.
Furthermore, “the impact of investment already facilitated towards capital deployment or implemented is N$4.83 billion, and the total GDP impact of potential investment is N$185.51 billion.”
Similarly, the treasury impact of potential investments is N$17.50 billion.
“Renewable energy has the highest interest with 39%, closely followed by agriculture and food processing with 24%, meanwhile oil and gas comes in at 19% as there is no total energy and shell exploration but only Kudu is facilitated by NIPDB,” she said.
Meanwhile, metals and other sectors all take up less than 18% combined.
Nangula shared that during the board’s first year, they have determined five priority sectors in addition to the five proposed by Harvard Growth Lab for a total of 10 priority sectors for Namibia.
“Renewable Energy, Food Industry, Tourism, Transport and Logistics, Metals, Mining, and Adjacent Industries are among the sectors identified. In addition, Machinery and Electronics, FINTECH, Exploration (Mining and Oil and Gas), Chemicals and Basic Materials, and Services (Digital and Global Business),” she said.
Meanwhile, Uaandja also highlighted certain hurdles that investors face such as input cost, low incentives, energy cost and availability amongst others.
“Some of the challenges include legislative gaps such as incentives, administrative gaps and turn around times, the time taken by OMAs and SOEs to respond to requests, issue permits and land complications can slow down the process of starting operations,” she said.
She further highlighted funding acquisition and market access as challenges, amongst others.