By Petronella Sibeene
WINDHOEK
Namibia’s need to attract new investments in power generation and transmission received a boost on Tuesday when the United States Trade and Development Agency (USTDA) announced an additional US$423 790 to develop an Independent Power Producer (IPP) and investment market framework.
The USTDA grant of US$423 790 was awarded to the Electricity Control Board (ECB) which is currently working on the establishment of commercially viable independent power producer (IPP) projects in the country.
This is the second phase of technical assistance from USTDA to the ECB, bringing the total funding for the project to nearly US$700 000.
In an effort to address the looming power deficit in Namibia and the SADC region, the ECB developed an IPP and Investment Framework for Namibia.
The IPP and Investment Market Framework as developed by the ECB and approved by the Ministry of Mines and Energy hopes to open up the energy sector and lure investment in power generation.
The ECB facilitates the implementation of an IPP and Investment Market Framework and issues special conditional licences to prospective investors in generation.
Attracting new investments in power generation and transmission in the country is highly recommended in order to enhance security of electricity supply and economic efficiency.
Namibia’s power generation does not meet the demand for energy and as such, the country imports most of its power from South Africa and other southern African countries. However, the diminishing power surplus in the region demands that the country expands its own generation.
According to the ECB Chief Executive Officer Siseho Simasiku, the ECB completed the development of the project in December 2006.
Implementation started immediately and a number of proposals for IPP projects and several conditional licences have been issued.
Simasiku said even if the ECB is committed to the success of this project, inadequate financial resources are severely hampering progress.
He said received funds will be channeled towards advisory support for ECB review and due diligence of current and potential IPP projects.
Other areas to be looked into include the development of the IPP framework implementation instruments and capacity building of the ECB for IPP implementation, technical assistance in the development of an integrated resources plan and the distribution grid code, development of methodology for economic and financial analysis of IPP projects, development of guidelines for environmental analysis of IPP projects, and analysis of IPP developmental impacts.
This is the second time USTDA is assisting the ECB financially.
The agency is continuing its support to Namibia to help meet electricity demands in Southern Africa, said USTDA Regional Coordinator Douglas Shuster.
“Namibia is at a critical stage in its power sector reform and the Government of Namibia has recognized that private sector participation is necessary to meet the country’s energy demand and to take advantage of opportunities to become a major player in regional power generation and transmission,” the Acting United States of America Ambassador to Namibia, Eric Benjaminson, said at the announcement ceremony.
He said his country is a leader in electric power technology and as such the project will help introduce U.S. companies to the growing Namibian market in this industry and allow Namibia to explore United States IPP investors and operators, as well as goods and services for the sector.
Acting Permanent Secretary in the Ministry of Mines and Energy Kennedy Hamutenya said the IPP and Investment Market Framework would be incorporated in the new Electricity Bill to be promulgated soon.
“With regular blackouts and load shedding becoming the order of the day in the Southern African region, it is becoming increasingly urgent for Namibia to implement the framework as soon as possible,” he said.