Namibia’s solar market is booming with the country attracting fresh investments and new players. With a focus on both grid-connected and off-grid projects, the country aims to connect 80% of its population to renewables by 2025.
This surge is fuelled by strong regulatory support, abundant resources, a drive for diversification and the growing demand for decentralized power systems.
Untapped Resources
Blessed with 300 days of sunshine per year and offering a climate well-suited for solar generation, Namibia represents a viable solar energy market.
High solar irradiation levels coupled with an open, desert landscape provide a strong foundation for the development and expansion of solar panel systems.
Despite the potential for solar deployment, much of the market remains largely untapped, presenting lucrative opportunities for investors and project developers alike.
This untapped potential makes the country a highly attractive solar play and is a key driver behind the expansion of the market in 2023.
Diversification Efforts
Currently, an estimated 60% of Namibia’s power is imported from regional countries via the Southern African Power Pool, and while hydropower accounts for a large share of the energy mix, biomass and diesel-fired power generation are still heavily relied upon.
As such, the government is prioritizing the diversification of both the energy mix and the broader economy, expanding investment into renewable energy to support alternative energy sources, job creation and revenue generation.
Under efforts to diversify, the government has partnered with foreign stakeholders for the construction of large-scale green hydrogen facilities – of which solar represents a major part.
Examples include the $10 billion, 350,000 tons per year Tsau//Khaeb National Park project, spearheaded by Hyphen Hydrogen Energy.
The project will utilize 7 GW of renewable capacity and will create 3,000 permanent jobs in addition to 15,000 jobs during the four-year construction phase.
Decentralized Demand
Namibia has the lowest population density in Africa, with a large portion of the population living in remote areas without access to the national grid.
To bolster rural electrification, the government has turned to solar and is making a strong case for decentralized, off-grid solar systems across the country.
Rising demand for decentralized systems is driving solar deployment in Namibia, with a number of Independent Power Producers seizing the opportunities the market presents.
Backed by policies such as the Off-Grid Energy Master Plan – a framework established in 2007 that aims to provide access to remote areas by establishing ‘energy shops’ that sell suitable, approved energy products – the government is making headway to connect the population, with the off-grid market experiencing a surge in investment.
Additionally, companies located in off-grid areas are deploying their own solar systems, accessible to local communities.
Examples include a 5.4 MW facility constructed at the Rosh Pinah zinc and lead mine in the Karas region; a 2.5 MWh off-grid plant constructed at Gam Village in Otjozondjupa; and a 50 kWp solar system installed at the Nambwa Tented Lodge in Bwabwata National Park. In this scenario, rising demand is set to trigger newfound investment in decentralized solar.
Regulatory Support
Under efforts to attract foreign investment and private sector participation, the government has implemented a series of policies aimed at improving market clarity, transparency and fiscal support.
In addition to clear renewable targets, government implemented a Renewable Energy Feed-In Premium program in April 2015, a policy designed to support development by providing a guaranteed, above-market price for producers.
July 2017 saw the implementation of the National Renewable Energy Policy, which aims to near-universal access to renewable energy by 2030, assist Namibians climb the development ladder while positioning the country as a regional leader in the deployment of renewable technologies.
The policy, coupled with a series of tax incentives has attracted a strong slate of investment into the country.
