Namibia’s top energy sources are petroleum, hydropower, imported electricity and imported coal. The country’s own internal resources supply less than one-third of its needed energy requirements. Namibia has excellent biomass energy potential and is known to possess a world-class renewable energy resource base and well-developed energy policy.
The country has a responsive regulatory authority for the electricity industry, while the national energy utility, NamPower has a strong balance sheet and credit rating. The approval and implementation of the Modified Single Buyer Policy has enabled private sector investment and distribution of electricity, directly to customers.
The Energy Goal focuses on electricity supply security. Access to electricity is available to less than 50% of the population. According to the Electricity Control Board, Namibia’s generated electricity comes mainly from:
Local installed capacity in 2020 was at 624 MW. According to the National Integrated Resource Plan peak demand is currently at 673 MW and is projected to rise to 931 MW in 2025 and 1,348 MW in 2030. It is expected that Namibia will achieve an installed capacity target of 879 MW by the end of HPPII.
Rising domestic consumption, dependency on electricity imports, peak power challenges, transmission congestion on import corridor, the decline of surplus generation capacity in the SADC, securing power supply and projected electricity demand, lead to the need for additional funding resources in the sector through Independent Power Producers (IPPs) and PPPs.
According to the 2015/16 Namibia Household Income and Expenditure Survey, there were 544,655 households, of which 249,827 were rural households and of these 60,958 (24.4%) could switch on a light with energy from the grid, solar or generator. The difference of 294,828 households were classified as urban, and of these, 211,981 (71.9%) had electricity from the grid, solar or generator. Rural electrification of schools and health facilities reached 87% by 2020.
Energy Policies & National Integrated Resource Plan (NIRP)
The energy sector offers opportunities for private investment in infrastructure. During HPPI key policy, structural and legislative reforms were effected for large base-load and mid-merit fossil fuel projects. The National Energy Policy, Renewable Energy Policy and Independent Power Producers’ Policy have been adopted. The Nationally Determined Contribution was also adopted by Cabinet in 2015 to guide Namibia’s implementation of the Paris Agreement on Climate Change, containing important Renewable Energy Share targets and Greenhouse Gas Emission reduction targets, which were used to stimulate investment into renewable energy infrastructure. The NIRP, which broadened the energy mix was finalised in 2016 following which there has been a subsequent increase in small IPP project investments.
During the HPPII period, further efforts will be made to align the three energy policies to the NIRP, to create greater certainty for investors and infrastructure developers. Key policy considerations to drive larger private investments into the energy sector include the approved 2019 electricity supply industry restructuring from a Single Buyer (“SB”) to a Modified Single Buyer (“MSB”) structure, the full implementation of “Net Metering” and equitable connection of “Embedded capacity” at mines and REDs. The historical focus of the Electricity Control Board (ECB) on the electricity sector, which only constitutes 20% of the spectrum of energy in Namibia, will be broadened through the enactment of an Energy Regulator Act, to the full scope of energy activities and resources. As a critical enabler of growth, energy policies and strategies need to assume a firmly integrated position across all pillars of HPPII.
Advances in prioritising water supply have been made through a Cabinet Committee on Water Supply Security (CCWSS) appointed in July 2016. The Committee has made progress in advancing water solutions for Central, Central Coast, Central North and North East parts of the country. HPPI was characterised by severe drought conditions and solutions have therefore involved short, medium and long term programmes. Projects funding under HPPII includes Public-Private Partnerships, Development Finance Institutions and donor interventions. Projected shortages of water in all regions and the critical dependence on the water of communities and industry require utmost priority by all stakeholders.
Most parts of Namibia were fortunate to receive good rainfall since the beginning of 2020/21 rainy season. Runoffs in almost all the rivers, feeding the larger dams, were exceptional to such extent that most of the larger dams were filled to capacity and some even overspilled. These include among others, the Naute, Oanob, Swakoppoort, Friedenau and Omatako dams. Moreover, the newly completed Neckartal dam was filled to capacity and eventually overtopped. The Von Bach dam has almost reached it’s capacity and these filled up surface water resources should be able to sustain supply to the communities that they serve for the next three to four years.
Early indications show that most of the underground aquifers in the country, except those in the northwestern parts where little rainfall was recorded, have been substantially recharged. Some water supply shortages to the smaller communities in the rural areas of the northern Erongo and Kunene regions still exist and are being attended to by the relevant authorities. Although the recent rains have brought great relief in general, water supply to many parts of the country remains under pressure over the medium to long term as demand for water in these regions, which include the central, central coastal areas and the more densely populated northern regions remain under threat. Government programmes are ongoing to timeously develop additional sources of supply, to meet the expected growth in demand for water. In this regard a water security development programme in excess of N$5.9 billion has recently been announced. This programme will be carried out over the next five years with the financial assistance of the German Government and the African Development Bank.
There has been no substantial recharge to some of the main aquifer systems, particularly those in the coastal areas of the country. Mines that make extensive use of water are not operating at full capacity. The uranium sector, in particular, is most affected by water shortages. The desalination plant at the coast cannot supply adequate water for both domestic and industrial consumption.
The strategic positioning of Namibia as a transport and logistics hub has catalysed significant investment in the Walvis Bay and Lüderitz seaports and roads, rail and selected airports during HPPI. Road infrastructure has also been upgraded and expanded, and some upgrading of rail infrastructure has commenced. The rail transportation system remains underdeveloped and requires significant investment during HPPII. Investments into the port, airport and road infrastructure are likely to achieve better value-for-money outcomes through PPPs and private funding options.
Namibia has a well-established road network of 48,875.27 Km, where road construction and maintenance adhere to international standards. In road infrastructure, the country is rated number 1 on the continent by the World Economic Forum (2019). The majority of towns and communities can be accessed via a road network and the country is linked by road to Angola, Zambia, Zimbabwe, Botswana, South Africa and the Democratic Republic of Congo. Namibia has four corridors, namely the Trans Kalahari via Botswana, Trans-Caprivi, Trans-Cunene via Angola to DRC and Trans-Oranje via South Africa, linking to SADC countries. Due to low traffic volumes, the majority of roads are untarred. The distribution of road surfaces is as follows:
During HPPI, an additional 1,192 Km were added to the national road network. Over 1,480 Km of roads will be upgraded during HPPII to improve accessibility across the country. Government is upgrading the railway network to double the volume of cargo transported between Walvis Bay-Kranzberg-Tsumeb-Oshikango, and Kranzberg-Windhoek. In addition, Government is rehabilitating the track between Tsumeb-Kranzberg– Walvis Bay. This refurbished and upgraded railway track will contribute to the efficient operation of the Trans-Kalahari Corridor network.
The Corridor stretches over 1,900 Km along Walvis Bay – Windhoek – Gaborone – Johannesburg and Pretoria. It is supported by a railway line from the Port of Walvis Bay to Gobabis (via Windhoek), where transhipment facilities are available and continues from Lobatse in Botswana.
The Information, Communications and Technology subpillar has seen some real progress during the HPPI period. Nevertheless , the exponential advance of ICT technology as a catalyst for innovation and economic growth calls for continuous investments into the sector. Low rankings in the Global ICT Index (118) and Global Cybersecurity Index (141) call for a targeted reform as we embark on the 4th Industrial Revolution. The pending Cybercrime Bill, the absence of open access guidelines, usage and affordability for rural schools, health facilities and public offices have undermined progress on e-services.
The cost of entry-level mobile broadband in SADC ranges from 1.8% to 126.4% of Gross National Income (GNI) per capita with only two SADC countries (Mauritius and South Africa) having achieved the UN target of 2% of GNI per capita.
Namibia has invested in the modernisation and expansion of telecommunications. International satellite services link Namibia to telecommunication services worldwide. Namibia boasts a 98% digital telecommunications infrastructure, which provides direct dialling to most places in the world. Namibia has cellular coverage in most towns and road coverage along virtually all the major routes in the country. Namibia’s cellular network service providers have installed a fibre optic cable technology across the country.
Namibia enjoys over 100% mobile telephony penetration with about 70% of users accessing the Internet through various technology platforms and services offered by over 26 licensed telecommunication service providers.