Energy “Suddenly the desert is precious” – The world needs green energy, and Namibia can have a solution

Lüderitz

Lüderitz is an old diamond mining town that doves a sparsely populated country on the rocky coast. The city on the Atlantic coast last flourished in the early 20th century when diamonds were found on nearby sandbanks.

Namibia is now positioning itself as a leading producer in the growing market for so-called green hydrogen. Green hydrogen is produced using renewable electricity.

In Namibia, the sun shines brightly on an average of 300 days a year and strong winds whip nearly 1,600 kilometers of coastline. Thus, renewable energy experts and officials estimate that the country of Southwest Africa has a greater potential to produce renewable energy.

It is of great interest to investors trying to increase their share of the rapidly expanding green energy investment market.

Namibia is already using the EUR 40 million grant it has received from its former colonial host for feasibility studies and pilot projects related to green hydrogen.

Green hydrogen is made by separating the hydrogen atoms in the water using renewable energy such as wind and solar electricity. Another way is to make hydrogen from fossil fuels. This produces gray hydrogen or blue hydrogen if fossil fuel emissions are recovered.

Most of the hydrogen produced today is not green. Hydrogen can be burned instead of kerosene-based fuels in car and aircraft engines or used in power plants instead of coal or natural gas.

According to the German government, Namibia’s inherent strengths could help it produce the world’s cheapest green hydrogen. Its use is an essential part of the effort to zero net carbon emissions by 2050.

Green hydrogen could also provide a long-term storage option for renewable energy. Hydrogen would be made with renewable energy, after which the hydrogen would be burned in a power plant. This would allow the electricity to be stored for later use. Namibia expects to be able to export green hydrogen abroad by 2025.

“

The U.S. Department of Energy has called the competition for the production of pure hydrogen “the hearing of this generation”.

Namibia is one of many countries seeking to fund a rush towards green energy. Efforts are being made to increase hydrogen production around the world.

The U.S. Department of Energy has called the competition for the production of pure hydrogen “the hearing of this generation”. According to consulting firm Wood Mackenzie, the number of green hydrogen projects announced worldwide has increased 50-fold in 12 months. However, such projects require expensive infrastructure.

The journey to large-scale exploitation of green hydrogen is a long one. Expensive technology must be widely used to reduce costs and prices.

Another problem to be solved is the export transportation of the finished product. Lüderitz also needs a new deepwater port that would allow shipping. Namibia believes it will be funded through a private-public joint venture.

Namibia is an extremely rainy country. Therefore, the production of green hydrogen in the country involves the removal of salt from seawater.

Desalination plants are generally expensive, but according to the German Government the process generates only 1% of the cost of producing hydrogen.

“The list of new potential countries capable of producing renewable energy is pretty short, and Namibia is on that list,” says Wood Mackenzie, director of global hydrogen consulting. Noel Tomnay.

However, he said there are also significant challenges ahead.

“Infrastructure, the right kind of water and just the uncertainty associated with a new entrant on such a large scale.”

Several global companies expressed interest in bidding for the construction of two separate but parallel massive desalination plants by the Namibian government.

The plants would also include wind and solar power plants as well as electrolysis plants that break down water into hydrogen and oxygen with the help of electricity. Electrolysis equipment is intended to produce and export green hydrogen and ammonia.

Namibia received a total of nine bids from six companies for the construction of two facilities. The bidders were Sasol of South Africa, Fortescue Metals Group of Australia and Enertrag of Germany. The latter is a shareholder in a company called Hyphen Hydrogen Energy, which received contracts for the development of both plants.

Hyphen is a project company formed to develop, build and operate green hydrogen production facilities in Namibia. The company-led project aims to produce 300,000 tons of green hydrogen per year by 2030. It requires five gigawatts of renewable electricity generation capacity.

The cost of the project is US $ 9.4 billion (€ 8.3 billion).

The ambitious project is of international interest anyway. The Namibian government has been invited to the World Economic Forum in Davos, Switzerland, to present for the first time in January its economic recovery plan after the corona pandemic. Green hydrogen plays a key role in these plans.

Project the focal point is Lüderitz, a sleepy coastal town decorated here and there with buildings in the style of German Art Deco architecture.

The project areas are about an hour’s drive away in the surrounding desert. Growing in a shallow shrub, each massive block of sandy desert is about 1,750 square kilometers in size.

“The first diamond rush was in 1900,” says Lüderitz, technical director Ignatius Tjipura.

“Now here we are talking about the rush of green hydrogen.”

Namibia is the latest country in sub – Saharan Africa with the potential to become a global hub for green energy.

Gabon, a Central African, has signed an agreement to pay the country to conserve its vast forest resources as a carbon sink. Forests sequester more than one hundred million tonnes of carbon dioxide a year.

“

Namibia has other benefits than wind and sun.

In Kenya, 365 wind turbines form the Turkanajärvi wind power project. It currently accounts for about 17% of the country’s electricity generation capacity.

Namibia is helped by the benefits of nature in the green hydrogen race, but it also has benefits other than wind and sun. The country ranks sixth in the Corruption Perception Index of Transparency International, which measures corruption in various countries, compared to 49 sub-Saharan Africa.

“Doing business in Namibia is relatively easy,” says Tumoneni, CEO of Hydrogen Energy Margaret Mutschler. Tumoneni Hydrogen Energy is a Namibian company. It is owned by CWP H1 Energy, which in turn is part of the CWP Group, which produces renewable energy.

The Namibian government has decided to step aside and leave the private sector to lead green energy projects. So the state is not trying to administer them itself.

“We don’t think the state should be there for the driver. The private sector is doing better, ”says Namibia’s finance minister Ipumbu Shiimi.

Strategic infrastructure investor and project developer Nicholas Holdings won tenders in both blocks together with Enertrag.

Vice President, Enertrag’s New Energy Solutions Division Tobias Bischof-Niemz says Namibia has a good chance of exporting green hydrogen to South Africa.

At the same time, Namibia can help its southern neighbor meet its energy needs and achieve its carbon-neutral goals. Repeated power outages are a scourge in South Africa.

Sasol, a South African petrochemical and energy company, responded to Namibia’s call for tenders by bidding for both blocks. Sasol is Africa’s largest producer of synthetic aviation fuels.

The company declined to comment on its offers. Economic Adviser to the President of Namibia James Mnyupe says, however, the country’s government has received contacts from several builders, including Sasol.

Builders have been ready to explore opportunities to build a pipeline between Namibia’s project areas and Sasol’s main production facilities. They are located in Secunda, about 1,600 kilometers away.

“Now, all of a sudden, the desert has become valuable,” says Finance Minister Shiimi.

Translated from England by Jyri Raivio.