Namibia gets $544 mln boost for green hydrogen production as it looks to catalyze shipping’s decarbonization

Namibia, one of the world’s sunniest countries, is investing strenuous efforts in exploiting its abundant natural resources to produce renewable energy, most notably green hydrogen, and position itself as a renewable energy hub.

“Namibia is comfortable with being a first mover in an industry that is nascent and one that is very hard to define. The Government of Namibia identified the synthetic fuel industry in the country as the key enabler of the diversification of our economy. Then we began to profile ourselves as the potential exporter, but we came to the realization that we couldn’t do that alone and we started partnering with various other countries,” James Manyupe, Economic Advisor to the President, Republic of Namibia, said while speaking during an IMO side event on the production of future marine fuels in developing countries, held on Thursday at COP27.

During the COP27 summit in Egypt, Namibia’s President Hage G. Geingob announced that the country has received a grant of €40 million from the Netherlands to develop a green hydrogen ecosystem in Namibia. The country has also signed a Memorandum of Understanding with the European Union at the event, strengthening the Partnership on Green Hydrogen and Critical Raw Materials Value Chains.

The EU and Namibia have committed to developing an operational Roadmap for 2023-2024, with concrete joint actions agreed to take place within the next six months involving relevant industrial and financial stakeholders from the EU Member States and Namibia.

In parallel, the European Investment Bank (EIB) and Namibia signed a joint declaration to deepen their cooperation in support of renewable energy, including renewable hydrogen. The duo committed to work towards the implementation of a loan by EIB Global to the Government of Namibia of up to €500 million.

Both the EU and Namibia believe that renewable energy and hydrogen will be essential components in their respective energy transition journeys, where shipping has a massive role to play. The Namibian government has already laid the groundwork for the establishment of hydrogen transportation links between Namibia and its partners Belgium and the Netherlands.

Specifically, in 2021 and 2022 the Namibian Ports Authority (Namport) signed agreements with the Port of Rotterdam, and Port of Antwerp-Bruges, respectively, aimed at exploring the potential of cooperation on exporting hydrogen from Namibia. The Dutch and Belgian ports have already voiced their ambitions of becoming hydrogen hubs and facilitating the flow of hydrogen on global markets.

There is a general push driven by the IMO for the inclusion of developing countries, small island developing States (SIDS), and the least developed countries (LDCs) in scaling up the production and supply of renewable fuels as part of the just and equitable transition idea. Especially, as the majority of these countries are rich in natural resources they can use to produce renewable energy, such as solar and wind power.

Countries like Namibia, Chile, Brazil, Marocco, and many more are seizing the opportunities emerging from the energy transition journey of the hard-to-abate sectors as there is a massive need for the production of renewable energy and green fuels.

“One of the key things that we realized was that shipping was very relevant as an off-taker of green fuels and also as an enabler as it would be key in transporting the molecules cost-effectively from Namibia to countries around the world,” Manyupe said.

Specifically, shipping will need around 800 terra joules of advanced biofuels and 50 million tons of green hydrogen, mostly in the form of ammonia, to decarbonize, according to the estimates of IRENA, an intergovernmental organisation aiming to promote renewable energy. Furthermore, shipping is expected to transport 75 million tonnes of green hydrogen each year, which is critical for the decarbonization of other sectors. This is equivalent to the global hydrogen demand today, as explained by IRENA Director-General Francesco La Camera.

“The solution for countries like Namibia is to come to a realization that a portfolio of actions is needed to really begin to move the needle. At the highest policy levels, you need to prioritize the decarbonization of the very hard-to-abate sectors as a key enabler for diversifying the economy all the way down to training the workforce to acquire the skills that are needed to decarbonize something like shipping, which we are doing in partnership with institutions around the world. It requires a top to a bottom response from a country that is looking to be a strategic player in this space,” Manyupe said.