The green energy sector in Africa is witnessing significant developments, highlighted by Namibia’s recent strides in the field of hydrogen production. The Sustainable Development Goals (SDG) Namibia One Fund, dedicated to green hydrogen financing, has teamed up with Hyphen Hydrogen Energy to boost the nation's clean energy initiatives. This partnership marks a pivotal movement not just for Namibia, but potentially for the entire continent.
Recently, SDG Namibia One, which serves as Namibia's leading blended finance vehicle, finalized a share subscription agreement resulting in the Fund acquiring a 24% stake in the landmark Hyphen green hydrogen project. This strategic move is accompanied by an initial investment of EUR 23 million aimed at kickstarting the ambitious project.
The Hyphen project is set to be the largest green hydrogen production initiative in Sub-Saharan Africa, developed on 4,000 square kilometers of land within the Tsau ||Khaeb National Park. When fully operational, it will utilize approximately 7 GW of predominantly wind and solar renewable energy generation capacity alongside 3 GW of electrolyser capacity. The completion of Phases 1 and 2 is expected to result in the production of 2 million tonnes of green ammonia annually, significantly supporting global green energy standards.
Marco Raffinetti, the CEO of Hyphen Hydrogen Energy, emphasized the potential global impact of the partnership, stating, “Ever since we started working with Government, we have ensured this project creates a new global standard for the sustainable and equitable development of international large-scale green hydrogen projects.”
The Fund aims to raise USD 1 billion from both local and international investors, demonstrating the level of commitment to tap significant funding pools necessary for propelling green hydrogen initiatives. This blended finance approach not only reduces transaction costs, but also encourages rapid and effective project development, expediting investment decisions.
The economic benefits projected from the Hyphen project are considerable. Employment estimates during the construction phase reach as high as 15,000 jobs, with the aim of fulfilling 90% of those positions with Namibians, including 20% targeted for youth. By fostering local procurement strategies, the project also hopes to establish sustainable pathways for economic growth, with 30% of goods and services sourced locally.
Joost Oorthuizen, CEO of Invest International, remarked on Namibia's promising position within the global green energy movement. “Today’s announcement reinforces Namibia’s position as a leader in the global green energy movement and the Government’s continued commitment to realizing the potential of the green hydrogen sector for all Namibians.”
At the heart of this initiative is the goal to mitigate climate impacts, with the project projected to avoid approximately 5-6 million tonnes of CO2 annually. Andrew Johnstone, CEO of Climate Fund Managers, reinforced the essence of this achievement by sharing, “Green hydrogen has a pivotal and unique role to play in achieving net-zero targets by 2050.”
Benedict Libanda, CEO of the Environmental Investment Fund of Namibia, articulated the goals of the entire undertaking perfectly, expressing, “With the acquisition of 24% equity stake, we are not just investing; we are catalyzing Namibia’s global leadership in green hydrogen production.” His sentiment echoed the broader vision of ensuring systemic engagement with local communities and stakeholders throughout the project’s lifecycle.
The convergence of governance illustrated through proactive collaboration with private sectors and innovative funding avenues could well set Namibia as the forefront leader of green hydrogen technology initiatives worldwide. This project doesn't just represent financial investment but also signifies the country’s resolute path toward sustainable energy practices.
With COP28 holding discussions aimed at enhancing financial investments for Global South, and with Namibia spearheading initiatives like this, the window for African countries to leverage their renewable resources could widen considerably. The Hyphen project stands as proof of the tangible benefits achievable through strategic green investments and could inspire other nations to undertake similar paths toward economic and environmental sustainability.
Overall, the partnership between SDG Namibia One and Hyphen Hydrogen Energy encapsulates what can be achieved when collaboration and innovative financing combine. Namibia’s green hydrogen project might become the template for future projects both within and beyond its borders, forging new paths toward economic growth and sustainable development.
