By: Justicia Shipena
Namibian policymakers have been urged to continue exploring options for green hydrogen and green ammonia, taking care to establish a global environmentally sustainable brand. This call was made in the Institute for Public Policy Research (IPPR)’s special briefing report for November on Namibia’s green transition by economist Robin Sherbourne.
Last year, Namibia announced its green hydrogen project, which is to support the country’s commitment to the Paris Agreement on climate change, with the ultimate goal of reducing emissions to net zero by 2050.
The U$9.4 billion project will produce 300 000 tonnes of green hydrogen per year for regional and global markets either as pure green hydrogen or as green ammonia.
Sherbourne said Namibia should let trusted private investors bear the risks associated with this exciting new technology.
With Namibia announcing plans to grasp the new opportunities presented by renewable energy in the production of green hydrogen and green ammonia, the economist said this has the potential to form an important new industry in Namibia.
“However, Namibia is located far from industrial end users and it is not clear what the economics of transporting liquid hydrogen will be and whether there will ever be a global market like the one that exists for liquified petroleum gas (LPG),” he explained.
Sherbourne stated that many countries are looking at green hydrogen options and it looks like the green hydrogen industry will be very competitive, free of the ‘economic rents’ associated with oil and gas.
In this regard, he said Namibia should ensure this new industry is developed responsibly in an environmentally sustainable way to get things right rather than rushing developments at all costs.
With the oil and gas discoveries in Namibia, he noted there are no incentives for countries like Namibia to forsake the exploitation of oil and gas resources.
“It will become harder to finance and exploit fossil fuel resources, especially for the larger oil and gas majors listed on global stock exchanges, some of whom have already declared their own net-zero targets,” Sherbourne said.
He explained that if Namibia succeeds in going ahead and exploiting its oil resource, this will be a game changer for its ability to borrow and spend.
In May 2021 the International Energy Agency (IEA) made clear that no investment in new fossil fuel supply projects if the world is to reach net zero by 2050.
“Namibia has made it clear that it intends to exploit oil and gas resources if they prove commercially viable. This should be done in a climate-friendly way,” he said.
On power generation, the economist said Namibia is already experiencing the impact of the reductions in the cost of renewables.
He stated that the falling cost of renewables means that Namibia is already pursuing ‘no regrets’ investments in the field of power generation, saying this should be accelerated.
