Namibia has secured a $138.5 million World Bank loan to improve its electricity network and integrate more renewable energy. The project will build a new transmission line; develop a battery storage system; and support future renewable projects.
A Landmark Renewable Energy Project
Namibia has received approval for its first-ever World Bank-financed energy project. The project aims to improve the reliability of the country's electricity transmission network and integrate more renewable energy. With a budget of $138.5 million, it will be managed by the national electricity utility – NamPower.
Satu Kahkonen, the World Bank Country Director for Namibia praised the project. She emphasized Namibia's leadership in moving towards a greener future. According to Kahkonen, this project supports Namibia’s Second Harambee Prosperity Plan (HPPII) and will help NamPower develop future renewable energy projects.
Kahenge S. Haulofu, Managing Director of NamPower expressed excitement about the project. He described it as a strategic investment essential for maintaining the country’s electricity transmission network. The new transmission line will help integrate variable renewable energy (VRE) sources within Namibia and support regional electricity trading. Additionally, the second utility-scale battery storage system will facilitate the integration of renewable energy plants.
Project's Design and Implementation Phases
The project consists of three main components. First is the construction of the second Auas-Kokerboom transmission line. This is followed by the development of a utility-scale Battery Energy Storage System (BESS) facility. The last component is technical assistance to help NamPower create bankable renewable energy projects and enhance socio-economic benefits. This initiative is expected to create jobs; develop skills; and increase female employment during the project's design and implementation phases.
Namibia which is known for its abundant renewable energy resources currently generates just over 30% of its electricity from renewables. Strengthening the power grid through this project is crucial for increasing the share of VRE sources. It will help reduce outage risks; support load growth; and enhance power trade opportunities within the Southern African Power Pool.
The project will also benefit from grant funding from the IBRD Fund for Innovative Global Public Goods Solutions and the Green Climate Fund. This funding will support the development of the second utility-scale battery storage facility. This will promote renewable energy integration and reduce imports. Likewise, it will improve grid stability and manage demand peaks.
New Namibian 10MW Solar Plant Under Construction
In a related development, Sustainable Power Solutions (SPS) is leading the construction of a new 10MW solar plant in Namibia. The plant is being built on Maxwell Farm in North Central Namibia and is expected to be operational by the end of 2024. The clean energy generated will be "wheeled" across the Namibian grid to the Otjikoto gold mine; located 300 kilometers away and operated by B2Gold (Namibia's leading gold producer).
This project is the first power-wheeling initiative under Namibia’s Modified Single Buyer (MSB) framework. The new framework allows energy companies like SPS to sell power directly to customers such as industrial companies and regional distributors. Previously, these companies could only sell to NamPower, the national utility. This shift represents a move towards more dynamic business models in Namibia's power sector.
As a result of this project, B2Gold’s Otjikoto gold mine is set to become one of Namibia’s greenest mines. The mine aims to offset an additional 26,360 tonnes of CO2 annually. SPS, B2Gold — the Oelofse family (who own Maxwell Farm) — and Fortitude, are collaborating on this initiative.
Chris Flavin, Head of Business Development at SPS, highlighted the significance of the project. He stated, “This project is one example of the many ways in which SPS is providing new and innovative solar power solutions to businesses and communities across Africa. Supplying high-quality and affordable renewable energy is at the core of SPS’s business. This project demonstrates our capability to execute complex projects.”
The combined efforts of the World Bank-funded initiative and the SPS-led solar plant signify a major step forward in Namibia’s renewable energy landscape. With these projects, Namibia is set to bolster its electricity infrastructure, enhance its renewable energy capacity, and support sustainable economic growth.