Namibia has decided to open its electricity market to independent power producers (IPPs) and helped investors to enter markets of other regional countries.
Namibia’s Electricity Control Board (ECB), Namibia Power Corporation (NamPower) and the Southern African Power Pool (SAPP) on Monday launched the SAPP and Modified Single Buyer (MSB) Market Access Guide at a two-day conference in Windhoek, capital of Namibia.
SAPP, which is a regional organization of power utilities within the Southern African Development Community, an intergovernmental organization, was created in August 1995 and has been successful in promoting the cooperation and coordination of the power sectors of its member states.
The guide helps independent power producers understand necessary processes and outlines requirements for their active participation in the power markets in Namibia and other regional countries.
“With the introduction of the MSB market model, we have successfully opened our electricity market to allow new entrants, new investment opportunities as well as new technical possibilities for the electricity supply industry,” Namibia’s Minister of Mines and Energy Tom Alweendo said in a statement.
According to Alweendo, the MSB model, introduced as a new market platform in 2019, has strengthened the role of the IPPs by allowing certain consumers to purchase a certain portion of their electricity needs directly from the IPPs. Before its introduction, power could only be purchased by state-owned NamPower.
And since the launch of the MSB market in Namibia, there have been requests for support with SAPP market access.
“Under the MSB, all transmission-connected customers … are allowed to buy a portion of their electricity from local IPPs,” he said adding that at a cross-border level, the MSB also allows for IPPs to be set up in Namibia specifically for electricity export purposes.
According to Alweendo, open access to both the SAPP and MSB markets is not only a boost for national and regional electricity trading but will provide vital infrastructure and insights for realizing the continental vision of the Africa Single Electricity Market.
“Firmly acknowledging the local MSB market in Namibia, with this guide, we provide structured information on how to become an active SAPP member. We are starting from the advanced Namibian perspective but ultimately aim to boost electricity trading in the entire region through increased participation of independent players,” said Stephen Dihwa, coordination center executive director of SAPP.
Meanwhile, Robert Kahimise, the chief executive officer of the ECB, reiterated that from a policy perspective, Namibia’s MSB market model has opened the door to a whole range of new investors and enables exports into the SAPP markets.
“The guidelines offer vital information to anyone interested in tapping into this potential,” he added.