Namibia still imports too much electricity

19 May 2019 | Energy

Windhoek • Ellanie Smit

Namibia is aiming to generate 80% of its electricity locally within the next four years, which will assist in sustaining the growing mining sector.

Without the sufficient and affordable supply of electricity, the mining sector in Namibia will not be able to operate optimally.

This was said by mines and energy minister during the opening of the Mining Expo and Conference held in Windhoek last week.

Alweendo said of the 4 285 GWh that was consumed in Namibia last year, 1 424 GWh was consumed by the mining sector. “This is a significant portion of electricity.”

He said the concern is that Namibia is still importing a too significant amount of electricity and the ministry is working hard to reverse this situation.

“Our current generation plan will ensure that by 2022 at least 80% of our electricity consumption must be generated locally. Over the years we were able to attract independent power producers (IPPs) to invest in electricity generation and we will continue to do so.”

Alweendo said as an additional step to attract more IPPs, government recently introduced a significant change in how electricity generated by IPPs is sold. He said that currently all IPPs are required to negotiate and sign a power purchase agreement with Nampower because it is only Nampower that is allowed to purchase electricity from IPPs.

As from September this will change when IPPs are allowed to sell their electricity to large buyers such as mining companies.

Mining is an important sector of the economy, contributing 14% to the GDP in 2018. During the same period, the sector employed 16 221 employees directly and 6 681 as contractors. The sector also contributed N$2.1 billion in royalty payment and N$1.7 billion for tax on profit.

In 2018, the total tax on profit collected from the whole private sector was N$6.9 billion. When comparing the two figures, the mining sector alone contributed about 24% to the total tax on profit in 2018.

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