Capricorn backs green hydrogen
Namibia is pursuing green hydrogen as a potential source of export earnings, industrialisation and job creation, according to Capricorn Asset Management (CAM).
In its report, Namibia: Comprehensive Economic Assessment, Funding Dynamics, and Sovereign Bond Yield Analysis, CAM said the sector offered Namibia an opportunity to combine its renewable energy resources with new economic activities.
“Namibia is pursuing green hydrogen because it offers a rare opportunity to combine the country's world-class wind and solar resources with a new source of export earnings, industrialisation and job creation,” CAM said.
The asset manager said the focus was increasingly extending beyond hydrogen production to wider industrial development.
“Policymakers increasingly view green hydrogen not simply as an energy project, but as a platform for broader green industrialisation,” CAM said.
It identified green ammonia, synthetic fuels, green iron and steel, and mineral beneficiation as potential areas of development.
CAM said a large-scale hydrogen industry could generate government revenue, create employment and attract foreign investment.
“A large-scale hydrogen industry could generate significant revenue for the government, while creating employment opportunities and attracting foreign investment into new sectors,” it said.
The report said the narrative around the sector had also shifted from hydrogen exports towards developing domestic value chains.
“More recently, the narrative has evolved beyond hydrogen exports towards building domestic value chains,” CAM said, adding that Namibia was seeking to use its renewable energy advantage to develop manufacturing and processing industries rather than exporting raw commodities alone.
Projects advance
CAM said progress had been made in the sector, although it remained at an early stage of development.
“Progress has been meaningful, although the sector remains in an early development phase,” the asset manager said.
It identified the Hyphen Hydrogen Energy project in the //Kharas region as the sector's flagship investment.
“The flagship Hyphen Hydrogen Energy project in the Lüderitz//Kharas region remains the anchor investment,” CAM said.
The asset manager said the government was supporting infrastructure planning, local content initiatives and port development around Angra Point.
CAM also highlighted developments in downstream industries, including HyIron Oshivela.
“HyIron Oshivela have demonstrated that green industrialisation can move beyond hydrogen production into downstream manufacturing,” CAM said.
It noted that Namibia had inaugurated one of the world's first green iron plants.
According to CAM, HyIron plans to begin construction of a major expansion of its Oshivela green iron facility in 2027. The expansion is expected to increase production more than tenfold to more than 200,000 tonnes a year.
The report also identified Cleanergy Solutions Namibia and the Daures Green Hydrogen Village among initiatives advancing the sector.
Infrastructure and funding challenges
CAM said significant challenges remained as Namibia sought to develop the industry.
“Namibia still needs to develop critical infrastructure such as ports, transmission lines, desalination facilities and shared industrial infrastructure,” it said.
The asset manager also identified the need to secure long-term export markets and attract the capital required to commercialise projects.
“Namibia needs to secure long-term export markets and attract the large volumes of capital required to commercialise projects,” CAM said.
The report also identified skills shortages, environmental approvals and community support as risks to the development of the sector.
CAM said “rising competition from other hydrogen-exporting countries” was another significant risk.
