CHAMWE KAIRA
NamPower plans to spend N$15.6 billion on capital projects over the next five years.
The company presented figures during a stakeholders meeting on Wednesday.
The company warned that load shedding would harm the economy and explained its commitment to supplying energy at all costs to avoid such negative impacts.
Rising commodity prices, which have surged significantly above inflation, and increasing funding costs were also highlighted as challenges.
This year, the Electricity Control Board (ECB) withdrew its approval for an 8% tariff increase for 2025.
NamPower said if allowed, it would have applied for an 8.7% increase.
The company also noted delays in projects by Independent Power Producers (IPPs), which have stalled the implementation of 114 MW of capacity.
IPPs have requested higher tariffs, further complicating the situation.
Under the Modified Single Buyer (MSB) Market Model, introduced in 2019, the market currently has nearly 25 MW of capacity, with an additional 40 MW expected soon.
Through the Modified Single Buyer, the Namibian Electricity Supply Industry aims to reduce dependency on external electricity imports.
It allows certain electricity consumers and Independent Power Producers (IPPs) to directly transact for up to 30% of their electricity requirements, promoting local generation and decreasing costs.
NamPower observed that the IPPs are concentrating on exports rather than actively pursuing supply to the local market.
IPPs who want to export are reluctant to share costs on equal footing with Namibian customers, NamPower noted.
The company disclosed that the expected credit losses are N$157 million impaired for the 2024 financial year and that the total outstanding overdue debt amounts to N$960 million.
ECB CEO Robert Kahimise disclosed that the board has embarked on the revision of the Market Performance Management Framework for the Namibian Electricity Supply Industry.
“An efficient market performance management framework is essential for monitoring and enhancing the operational performance of our electricity market. It empowers regulators and stakeholders alike to identify inefficiencies promptly and implement corrective measures.”
Kahimise disclosed that various power projects are currently underway, which include renewable energy projects and capacity enhancements that will bolster the power grid.
“These projects are significant steps towards achieving our goal of a secure, sustainable energy future.”
The ECB is also revising its methodology for determining electricity tariffs.
“We currently review tariffs annually, but we have started investigating the possibility of introducing multi-year pricing in our market.”
The ECB has embarked on the revision of the Market Performance Management Framework for the Namibian Electricity Supply Industry.
“An efficient market performance management framework is essential for monitoring and enhancing the operational performance of our electricity market. It empowers regulators and stakeholders alike to identify inefficiencies promptly and implement corrective measures.”
