Namibia's electricity market expanding
Export to SAPP attracts attention
The modified single-buyer system brings market liberalisation, competition, and choices for consumers.
Namibia's Electricity Control Board (ECB) has approved Solnam's application to increase its solar power capacity for export to the Southern African Power Pool (SAPP) from 13.2 MWp to 60.65 MWp.
The board has also granted approval for ANIREP's application to supply 25.722 MWp to Dundee Precious Metals in Tsumeb, Inceptus Energy's application for 0.9036 MWp of solar power for the University of Namibia's (Unam's) main campus, as well as Paratus Telecom's application to generate 0.9 MWp of solar power for their own use. Approval has also been granted to SCA Trading for licences to trade and export electricity.
However, the board has rejected applications from Windnam Energy, Ino Investment and Terrawatt Africa to export power to the SAPP due to limited capacity and restrictions on the amount of power that the network interconnections to Zambia and South Africa can carry.
Independent producers
To date, the ECB has granted licences for the export of a total of 1.2 GW to the SAPP, while the power grid's export capacity is currently only 780 MW.
According to the ECB's CEO, Robert Kahimise, Namibia's demand for electricity has increased to 700 MW.
Kahimise said independent power producers can be attracted to exporting electricity to the Southern African Development Community (SADC), where prices are higher. In contrast to an average solar power price in Namibia of around 70 cents per kilowatt-hour, the price for solar power in the region can sometimes be as high as N$2 per kilowatt-hour.
"There is room for more local generation, but consumers are looking for lower prices," Kahimise said.
According to the ECB's general manager for economic regulation, Pinehas Mutota, exports offer a larger market, with a current shortage of 9 000 MW being experienced.
Exporting dream
Kahimise believes that the market is shifting towards power supply to the SAPP, allowing the ECB to "realise the Namibian dream of exporting electricity."
Mutota added: "Our dream is to become an exporter of clean power."
He also clarified that the network limitation only affects power exports and not the emerging green hydrogen industry.
Regarding the network's export capacity, both Kahimise and Mutota agreed that it's not solely the responsibility of the national power provider, Nampower, to address this issue.
"There are examples in the region of independent transmission companies that build and maintain their own infrastructure," said Mutota. "The ECB can and will consider applications of this nature within the framework of our laws," Kahimise explained, while also taking into account duplication and the standard of infrastructure.
Namibian model
These developments are possible thanks to Namibia's modified single-buyer system, which, according to Kahimise, is currently receiving significant attention from neighbouring countries in the region.
"Everyone is looking at the Namibian model. We are progressing towards market liberalisation, greater competition, and more choices for consumers. The system allows independent power producers to supply up to 30% of the electricity to certain large consumers. Out of the 26 eligible consumers, 20 have already registered with the ECB. Three of the remaining six have applied for registration. These three applications, including one from the City of Windhoek, will be completed by the end of this month," Kahimise said.
Independent power producers already serving large consumers include Rosh Pinah Solar Park, which provides 5.7 MW to the Rosh Pinah Zinc Mine; Skeleton Coast Trawling, and Namibia Poultry Industries, both generating 2.6 MW and 3.1 MW, respectively, for their own consumption.
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The board has also granted approval for ANIREP's application to supply 25.722 MWp to Dundee Precious Metals in Tsumeb, Inceptus Energy's application for 0.9036 MWp of solar power for the University of Namibia's (Unam's) main campus, as well as Paratus Telecom's application to generate 0.9 MWp of solar power for their own use. Approval has also been granted to SCA Trading for licences to trade and export electricity.
However, the board has rejected applications from Windnam Energy, Ino Investment and Terrawatt Africa to export power to the SAPP due to limited capacity and restrictions on the amount of power that the network interconnections to Zambia and South Africa can carry.
Independent producers
To date, the ECB has granted licences for the export of a total of 1.2 GW to the SAPP, while the power grid's export capacity is currently only 780 MW.
According to the ECB's CEO, Robert Kahimise, Namibia's demand for electricity has increased to 700 MW.
Kahimise said independent power producers can be attracted to exporting electricity to the Southern African Development Community (SADC), where prices are higher. In contrast to an average solar power price in Namibia of around 70 cents per kilowatt-hour, the price for solar power in the region can sometimes be as high as N$2 per kilowatt-hour.
"There is room for more local generation, but consumers are looking for lower prices," Kahimise said.
According to the ECB's general manager for economic regulation, Pinehas Mutota, exports offer a larger market, with a current shortage of 9 000 MW being experienced.
Exporting dream
Kahimise believes that the market is shifting towards power supply to the SAPP, allowing the ECB to "realise the Namibian dream of exporting electricity."
Mutota added: "Our dream is to become an exporter of clean power."
He also clarified that the network limitation only affects power exports and not the emerging green hydrogen industry.
Regarding the network's export capacity, both Kahimise and Mutota agreed that it's not solely the responsibility of the national power provider, Nampower, to address this issue.
"There are examples in the region of independent transmission companies that build and maintain their own infrastructure," said Mutota. "The ECB can and will consider applications of this nature within the framework of our laws," Kahimise explained, while also taking into account duplication and the standard of infrastructure.
Namibian model
These developments are possible thanks to Namibia's modified single-buyer system, which, according to Kahimise, is currently receiving significant attention from neighbouring countries in the region.
"Everyone is looking at the Namibian model. We are progressing towards market liberalisation, greater competition, and more choices for consumers. The system allows independent power producers to supply up to 30% of the electricity to certain large consumers. Out of the 26 eligible consumers, 20 have already registered with the ECB. Three of the remaining six have applied for registration. These three applications, including one from the City of Windhoek, will be completed by the end of this month," Kahimise said.
Independent power producers already serving large consumers include Rosh Pinah Solar Park, which provides 5.7 MW to the Rosh Pinah Zinc Mine; Skeleton Coast Trawling, and Namibia Poultry Industries, both generating 2.6 MW and 3.1 MW, respectively, for their own consumption.
- [email protected]
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