By: Hee-Dee Walenga and Nghiinomenwa-vali Hangala
The national power utility, NamPower, has proposed that it becomes the main energy aggregator in the country for all dispatchable energy.
This would add to its other role of generation, transmission, and energy trading.
The utility proposal has been on public review for comments, and this week, the Electricity Control Board (ECB) hosted a public hearing on Monday in Windhoek, where NamPower presented its proposal for an Aggregation Model that would allow it to facilitate the export of electricity from Namibia.
A simple internet search revealed that an aggregator combines energy resources: gathers small generation (solar), storage (batteries), and controllable loads (EV chargers, smart thermostats) into one unit.
Moreover, it provides grid services, buys and sells electricity on wholesale markets, manages participants by handling contracts, monitors usage, and ensures compliance for each connected consumer or producer.
NamPower cites that they must maintain the national dispatch, planning, and control of supply/generation sources for the benefit of the grid, and to ensure security of supply.
The journey began on 13 September 2024 when NamPower submitted a proposal to the ECB to establish an aggregator function to facilitate the export of electricity from Namibia to regional markets, primarily through the Southern Africa Power Pool (SAPP).
The aggregated electricity will originate from the Nathaniel Maxuilili Power Plant (NMPP).
NamPower will play an intermediary role under this agreement by using the national higher transmission capacity priority to schedule energy transactions up to the Namibian border in exchange for an aggregation fee.
NamPower will also have dispatch control over NMPP through an Aggregation Service Agreement. ECB reviewed the proposal and held clarification meetings with NamPower.
The general manager of economic regulation at the ECB, Pinehas Mutota, explained that due to public interest and the potential impact of the proposal on various stakeholders, it necessitated a public hearing in order for NamPower and NMPP to present their proposal and allow stakeholders to present their views, concerns, and suggestions on the proposed aggregation model.
Gordon Gadney, Commercial and Planning manager at NamPower, argued that Namibia’s generation profile currently lacks the flexibility required from firms and dispatchable generation sources, which could facilitate more investment into renewable energies.
He also highlighted NamPower’s limited ability to balance export transactions.
“NamPower, as the national grid operator, has identified the need to act as this aggregator to unlock the current restrictions and limitations to the benefit of Namibia at large,” Gadney stated.
He defined an aggregator as a facilitator between energy producers and energy consumers/customers.
In the Namibian context, operating as an aggregator involves adhering to the current Modified Single Buyer (MSB) rules and ensuring transparency in the interest of the public.
“For NamPower, aggregation means managing generation sources and customers to best fit supply and demand profiles and to allow for optimisation between the two. Energy bought from multiple generators, whether NamPower-owned or from IPPs, will be blended with the aggregated firm and dispatchable source and then sold to the borders,” Gadney explained.
Energy is currently sold to local and foreign offtakers through Power Supply Agreements (PSAs). NamPower intends to introduce an Aggregation Service Agreement (ASA) to this model as well.
With the current framework of the MSB market, NamPower is not involved in the energy charge between Independent Power Producers (IPPs) and their customers. However, under the MSB model, NamPower collects reliability, SAPP wheeling, balancing, and transmission connection use of system agreement charges.
NamPower receives a portion of MSB revenue, but does not have the dispatch and control risk of the firm’s generators. With NamPower acting as the aggregator, an independent power producer would enter into an ASA with NamPower.
Through this, it will still have a PPA with its set off-takers on a back-to-back basis.
“The biggest opportunity for us is that we have market access for our excess energy, which we can also lend, aggregate, and on-sell,” Gadney indicated.
Gadney argued that the aggregator model will give IPPs guaranteed access to the market as well as committed offtake revenue, adding that no additional infrastructure is required to implement the aggregator model.
“We are thus asking for approval for NamPower to be the aggregator. This is mainly to maximise our available resources, specifically the transmission network, to unlock firm and dispatchable generation sources for security of supply in our network,” Gadney said.
STAKEHOLDERS’ REACTIONS
Several stakeholders in the room voiced concern with NamPower seemingly already having entered into an agreement with NMPP for the proposed aggregation model.
NamPower, throughout the engagement, emphasised that any local IPP that is ready to produce is welcome to approach NamPower for collaboration.
GreenCo, which is an IPP, provided their written comment stating that it has no objection to the establishment of a national aggregator, provided it aligns with MSB principles and preserves a fair, competitive playing field for all market participants.
“This requires clear functional separation within NamPower across its System Operator, Network Operator, Market Operator, Trading, and Aggregation roles,” GreenCo stressed.
It also explained that in principle, any exporter could aggregate multiple sources of supply, including variable renewable energy, battery energy storage system (BESS), and dispatchable generation. Adding, however, that positioning aggregation as an exclusive NamPower function risks
centralising commercial access and limiting competition.
GreenCo also requested that the terms under which supply for aggregation is procured be negotiated on arm’s length terms. It has also been noted that the current moratorium delays independent variable renewable energy developers, while NamPower continues advancing its own commercial model.
“This will create a protected window that entrenches NamPower as the default export aggregator. Clear timelines and parallel access processes are essential to avoid competitive distortion,” the company stated.
Moreover, BW Kudu, which also provided written comments, highlighted that if the aggregation proposal were to apply to all new dispatchable power projects, it would result in a re-establishment of a new single-buyer for dispatchable energy.
They noted that the dispatchable generator model is being used to develop an approach that might be sub-optimal without consideration of alternatives.
Secondly, BW Kudu wrote that the proposal would bring inequitable treatment of market participants other than Nampower and NMPP.
The gas to energy developer also added that the application of the proposal to all dispatchable projects would represent unfair appropriation of the commercial benefit of dispatchable generation by Nampower, at the expense of the project developers.
The ECB will review the proposal and provide feedback in the early new year. erastus@thevillager.com.na
