The world is faced with serious challenges of climate change and these impacts are being felt around the world, with severe floods, drought and storms.
Fossil fuels such as coal, oil and gas are identified as the largest contributors to climate change. In changing the current status quo, energy transformation requires a major shift from electricity generated from fossil fuels to renewable sources such as wind and solar.
In 2015, Namibia signed the legally binding international treaty (Paris Agreement) amongst 196 states to limit global warming below 2, preferably 1.5 degrees Celsius. In doing so, Namibia began positioning herself as a world class Green Hydrogen market leader on the African continent.
Green Hydrogen provides an excellent link between sustainable energy generation and tackling energy poverty. However, this move needs to be supported with a fit-for-purpose regulatory framework for Namibia, as capital alone is not sufficient to move Green Hydrogen forward.
According to Namibia’s Green Hydrogen Strategy, Namibia is set to introduce regulations and policies that would unlock the country’s hydrogen potential by 2025.
The strategy refers to the establishment of a Synthetic Fuels Act, which will comply with international export requirements and reduce the operational uncertainty for developers. Furthermore, the Act is set to define clear oversight activities such as providing transparent access to land and permit processes for the benefit of investors and the locals.
Currently, there are no policies or legislation enacted that can regulate Green Hydrogen in Namibia. However, there are laws in place where specific provisions can be amended or a new section can be incorporated to regulate the Green Hydrogen sector. Amending relevant laws is one of the fastest and most effective approaches, considering the lengthy processes of enacting legislation in Namibia.
For example, the Electricity Act of 2007, provides for the generation of electricity including renewable sources, it also contains specific licensing processes, which can include Green Hydrogen. However, a concern raised by some of the project developers in terms of the Act, is the Single Buyer Market Model contained in the Act, which requires Independent Power Producers to supply at least 30% of production to the domestic market and the remainder can be exported. From a commercial perspective, this model has made it difficult for Green Hydrogen project developers to develop a business case for Namibia, as it would affect its commercial revenue and control the market in which the investor wants to operate in.
Developing a strong and fit-for-purpose regulatory framework in Namibia is key towards implementing Namibia’s Green Hydrogen Strategy by 2025. The laws should be enacted in such a way that the Namibian people benefit from the Natural Resources, but most importantly, striking a balance to also attract foreign investment and grow the Namibian economy.
Lawmakers have a critical role to play, they need to consider laws that are still in draft form such as the Energy Regulatory Authority Bill to accelerate the development of the Green Hydrogen sector in Namibia.
When considering regulatory policies, Namibia needs to focus on an integrated policy approach to overcome resistance and reach a minimum threshold for market penetration. This integrated approach is based on four pillars, namely: national hydrogen strategies, policy priorities setting, guarantees of origin and enabling policies.
*Munolwisho Elizabeth Ipangelwa is an environmental and energy law specialist and a Green Hydrogen Advisor. She holds a Master’s Degree in Marine, Environmental and Natural Resources Law from the University of Cape Town and a Bachelor’s Degree in Law from the University of Namibia. Connect with her at ipangelwaelizabeth3@gmail.com or on LinkedIn.
