1. Who is responsible for energy policy? 2. To what extent have generation, transmission and distribution activities been unbundled? The Ministry of Mines and Energy (MME) is responsible for energy policy. The electricity supply industry in, consisting of the generation, transmission, sales, and the importing and exporting of electricity, has not been unbundled and is the responsibility the Power Corporation (Proprietary) Limited (NamPower), a state owned entity. NamPower has a generating branch which is not unbundled. Recently, with the intention of reforming the n electricity market, regional electricity distributors (REDs) were created within the country. NamPower distributes to mines, farms and local authorities where REDs are not operational. The REDs (NORED, CENORED and Erongo RED), along with other electricity distribution entities (mainly the City of Windhoek, other local authorities, regional councils and village councils), are responsible for the distribution of electricity. 3. Who owns and operates the (grid-connected) generation, transmission and distribution assets? 4. Who is responsible for supplying electricity to consumers? 5. Who is the power purchaser under IPPs? 6. Is the consumer tariff costreflective? 7. Is there an independent regulator? If so, which activities are subject to economic regulation? 8. Does the country belong to a regional power pool and are any interconnectors in place? NamPower owns and operates generation and transmission assets. NamPower also owns the REDs. This vertically integrated organisation results in a monopolistic situation with the transmission, generation and trading sectors governed by Nampower. NamPower is ultimately responsible for supplying electricity to consumers. NamPower. NamPower tries to price the tariff to be cost-reflective. Tariffs are determined by the Electricity Control Board (ECB) using a 'cost plus' methodology. The ECB is a statutory regulatory authority, with a mandate to exercise control over the electricity supply industry. Its main responsibility is to regulate electricity generation, transmission, distribution, supply, import and export in, which it does through setting tariffs and issuing licenses. belongs to the Southern African Power Pool (SAPP). The other members of the SAPP are Angola, Botswana, DRC, Lesotho, Malawi, Mozambique,, South Africa, Swaziland, Tanzania, Zambia, and Zimbabwe. There is an interconnector in place with South Africa.
9. Who is responsible for planning and procuring additional capacity to meet demand? The MME is ultimately responsible for planning and procuring additional capacity to meet demand. The Energy Policy Committee within the MME produced a White Paper in 1998 setting out its Vision 2030, containing the government's objectives in relation to energy. 10. What is the installed generating capacity? Is it adequate to meet existing demand? What is the energy generation mix? (In the case of renewables, please identify the technologies) 's total electricity generation capacity is currently approximately 430 MW, whilst its demand is around 657 MW. The country is heavily reliant on electricity imports from the SAPP, and electricity imports amounted to 58% of the country s consumption in the 2015 financial year. generated 42% of its own power during the 2015 financial year, of which, 88% was supplied by the Ruacana hydropower plant, and the remainder from coal and diesel stations. 11. What is the projected demand and what additional capacity is planned to meet it? What is the proposed energy mix? (In the case of renewables, please identify the technologies) The National Planning Commission of the Office of the President of published a document on the Energy Demand and Forecasting in in 2013, in which it projected that demand would rise to approximately 1 600 MW by 2030 (from 516MW in 2013, increasing at an annual rate of 4 percent on average). The ECB has launched two projects, the National Integrated Resource Plan (NIRP) and the Renewable Energy Procurement Mechanism (REPM). NIRP will determine the optimal resource mix for electricity generation in the country, while REPM will allow for transparent tendering by the private sector for all power projects exceeding 5 MW. The final draft of the country's renewable energy policy was presented to stakeholders by the ECB in August 2016, and contains four main scenarios of possible energy mixes: prowind/solar, pro-hydro, and a target of 70% renewable energy generation by 2030. 12. Is there a history of IPPs (excluding the renewable energy sector (other than large hydro))? If so, what procurement method was used? How have they performed? In November 2015, NamPower reported that it had not formulated a single off-take agreement with any IPP. There is no history of IPPs, and no apparent drive towards introducing IPPs, other than in the renewable energy sector and hydro sector, although it is reported that NamPower is seeking an equity participation of up to 49% in the Kudu gas to power project.
13. Is there a specific programme for procurement of grid-connected renewable energy? If so please provide details (including who will manage the process, the procurement method, criteria to be applied, process efficiency tools such as standardised documentation, the PPA term offered, incentives/comfort for investors including government guarantees and multilateral support instruments, responsibility for grid connection, other assistance e.g. in obtaining finance or with bid costs, the scale and structure of the programme, the status of the programme). The energy policy is articulated in the White Paper on Energy Policy of 1998 (WPE). It contains specific policies with regard to RE that have guided MME initiatives. Between 2007 and 2010, the n Renewable Energy Program (NAMREP) was developed to remove financial, economic, political and public awareness barriers to solar energy. Similarly, the Renewable Energy and Energy Efficiency Capacity Building Program (REEECAP) was implemented to generate information for the implementation of RE and energy efficiency policies formulated in the WPE. The ECB and the MME are working on a bill to encourage IPPs to apply for licences and encourage the development of renewable energy generation. In order to attract renewable energy IPPs, the country has developed a renewable energy procurement mechanism which is currently in the implementation phase. s electricity market model is currently in an evolutionary state. Although the country has a de facto modified single buyer market model, it is currently pursuing a modified single buyer model, which permits small IPPs to sell power directly to NamPower, REDs and large power users such as mines. The mechanism recommended tendering for renewable energy projects greater than 5 MW, a renewable energy feed in tariff for projects less than 5 MW but greater than 500 kw, and net metering for solar rooftop projects. In this regard, tendered for three solar plants of 10 MW each. The tender was awarded to Alten Renewable Energy Development (which proposed a single 35MW project rather than three separate 10MW projects), but was subsequently cancelled following a successful procurement challenge by ENEL Green Power. The Renewable Energy Feed in Tariff programme includes 14 IPPs for landfill, small hydro, small wind and biomass energy resources (less than 5 MW). Furthermore the first n IPP to feed power into the NamPower system, Omburu Sun Energy, was commissioned in May 2015 with a capacity of 4.5 MW. This was followed by a 5.6 MW plant developed by HopSol feeding into the CENORED distribution system. A 6MW solar project is reported to have been awarded to Sertum Energy. Other recommendations such as soft loans and tax incentives are also being considered, to further promote other IPP projects.
The final draft policy contains four main scenarios that have been developed: the Reference Scenario; a Pro-Wind/Solar Scenario with Kudu; a Pro-Hydro Scenario without Kudu; and a 70% Renewable Energy (RE) in 2030 Scenario. 14. Please outline the legal framework applying to any programme. Is it reasonably clear? 15. What level of capacity and resource does the procuring entity possess? Are other agencies such as multilaterals involved in the programme? The ECB is responsible for promoting private sector investment in accordance with government policy. The framework is reasonably clear. The principal legislation related to the electricity sector in is the Electricity Act 4 of 2007. The Act prohibits generation, trading, transmission, supply, distribution, importation and export of electricity without a licence issued under this Act. A separate licence is required for each of these activities. A generation licence for an IPP must be obtained before commencement of construction of the project and prior to signature of a power purchase agreement (PPA). The application process is clearly set out. Besides the application to the ECB, the applicant is also required to publish an advertisement comprising details of the proposed licensee and the project so as to enable affected parties to raise objections with the Regulator. The Regulator will then consider the application along with any objections, or before doing so, conduct a public hearing. The public hearing allows the Regulator to take into account all concerns of stakeholders. The Regulator may request details of the technical and financial resources available to the applicant to execute the work, to operate the system and to carry on the business. If an application is granted, the Regulator must issue the licence. Included in the issuing, the Regulator must specify the particular activity authorised by the licence, define the area in respect of which the licence is issued, contain or have attached to it any conditions imposed in relation to the licence and if applicable, contain a schedule specifying the approved tariffs that may be charged by the licensee for the provision of electricity to different classes of customers. After a licence is issued to an RE producer, a PPA has to be negotiated with NamPower, which acts as the single buyer and n grid operator. The programme is Funded by the MME and the World Bank.
16. Have any specific issues or concerns been expressed regarding the procurement programme? 17. Is investment in transmission and distribution required in order to increase the capacity of the system? If so, is there an effective programme in place? 18. Is there a specific programme for the procurement of/facilitation of off-grid renewable energy? If so please provide key details. There is no central data collection system for renewables in. The absence of technical baseline data (centralised resource profile) necessitates additional intervention measures if new entries into the n electricity supply sector are to be realised. For wind energy producers in particular, there are, in practice, some difficulties in successfully negotiating PPAs with NamPower. This is because they are confronted with the argument whereby they have to be responsible for an unpredictable capacity factor and an unstable grid in case wind energy contributes more than 10% of the local generation capacity. This suggests the Grid Code needs to be adapted for RE technologies. The grid is the major technical limitation for the integration of RE in. Some transmission lines present important losses which are even bigger in the distribution system (up to 20%). Moreover, many substations need to be upgraded in order to evacuate additional power. NamPower is currently planning and executing various upgrades to the transmission and distribution systems. The Off-Grid Energisation Master Plan for (OGEMP) is one of several projects that have been initiated by the MME Barrier Removal to n Renewable Energy Programme (NAMREP). The underlying objective of the OGEMP is to provide access to appropriate energy technologies to everyone living or working in off-grid, pregrid and grey areas. Presently, in, RE technologies are being widely used mostly for off-grid energization and domestic water heating. Solar PV is also use for rural access to modern energy. Further advice should be taken before relying on the contents of this summary. Clyde & Co LLP accepts no responsibility for loss occasioned to any person acting or refraining from acting as a result of material contained in this summary. No part of this summary may be used, reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical, photocopying, reading or otherwise without the prior permission of Clyde & Co LLP. Clyde & Co LLP is a limited liability partnership registered in England and Wales. Authorised and regulated by the Solicitors Regulation Authority. Clyde & Co LLP 2016