Namibia is moving towards accelerating the energy transition via green hydrogen development. The country’s SDG Namibia One Fund – a €1 billion clean energy fund will start advancing grants for project preparation by July 2023, a senior official revealed at the ongoing Africa Energy Indaba summit.
The Fund was launched during the United Nations Climate Change Conference in Sharm El-Sheikh, Egypt (COP27) in November 2022. It represents an innovative finance platform to facilitate and accelerate the development of a green hydrogen sector and economy in Namibia.
Benedict Libanda, CEO of the Environmental Investment Fund also added that the initiative aims to crowd different types of high concessional capital, which could be used to de-risk private sector investments. It is now in the process of starting advancing grants for project preparation in the country.
“We target to raise about €1 billion by end of this financial year and use it to invest in clean hydrogen assets and value chains and activate government equity participation in some projects. This is likely to be one of the biggest national hydrogen funds not only in Africa but globally…..and it does not include leverage or capital recycling, which can increase by threefold in terms of investment over a long term,” explained Mr Libanda.
According to him, Namibia will also take advantage of the carbon credit market to fund its green hydrogen projects.
“We are at the final design of the carbon market policy and framework which will be hosted within the Ministry of Environment, Forest and Tourism. The carbon market office is expected to be operational this August. It will be responsible for the registry of all the renewable energy assets that wish to participate on these international trading platforms.”
The country is also developing together with Hyphen Hydrogen Energy Ltd, the Hyphen project which is Namibia’s first large-scale vertically integrated green hydrogen project. The initiative was introduced in 2021 and Hyphen Hydrogen Energy successfully bid on the project back in 2022.
The $9.4 billion initiative is planned to be developed in phases, at full development targeting 350,000 metric tons of green hydrogen production a year from 5GW of renewable generation capacity and 3GW electrolyzer. It has the potential to displace about 5 to 6 million tonnes of carbon emissions per annum.
Hyphen is not considered a one-off project, it is fostering the development of common user infrastructure to facilitate the scale-up of hydrogen production by a factor of 10. It has the potential to produce up to 15 million metric tons per annum of green hydrogen across the country.