Namibia Exploring Barge Option to Plug Electricity Deficit

Updated on

Namibia is exploring the option of using barges with power plants to help plug an electricity shortage that may reach 300 megawatts in the next two years, Finance Minister Calle Schlettwein said.

The government is also considering coal, gas and solar projects, Schlettwein said in an interview in Cape Town on June 5. The African Development Bank has been appointed as advisers to help evaluate the most efficient and cost-effective interim measures that can be implemented until new generating capacity comes onstream in 2019, he said.

Namibia imports about half of its power from South Africa, Zimbabwe and Zambia, according to Schlettwein. Electricity capacity in the region is under severe strain as Eskom Holdings SOC Ltd., South Africa’s state-owned utility, struggles to meet demand and breakdowns at plants in Zambia and Zimbabwe disrupts output.

“Doing nothing is not an option,” Schlettwein said. “We’re facing a deficit because we’re not currently self-sufficient.”

The government is seeking temporary solutions because of declining power capacity in the southern African region and as some agreements on electricity imports come to an end by next year, the minister said. One of the contracts that will expire next year is with Eskom, according to Namibia Power Corp., the state-owned utility known as Nampower. Schlettwein didn’t provide details on how much the interim measures will cost.

Ghana Barges

Peak power demand in the country is 524 megawatts and supply from local sources is 300 megawatts, Nampower said in April. Electricity imports, which are projected at 2.6 billion Namibia dollars ($208 million) this year, may reach 12 billion Namibia dollars in the next four years, according to the company.

Namibia, with a population of about 2.2 million, is the world’s biggest offshore diamond miner and fifth-largest producer of uranium.

Karpowership, a unit of Istanbul-based Karadeniz Holding AS, provides electricity from vessels moored offshore. It agreed last year to supply Ghana with 450 megawatts of power for 10 years. Other African nations that have used power ships include Angola and Nigeria.

“One of the options is to barge,” Schlettwein said. “It’s one of the temporary solutions we’re looking at.”

Using power supply from barges is expensive and doesn’t increase the nation’s electricity capacity once the term of the contract ends, he said.

Kudu Fields

“It’s a costly option,” he said. “The option of no power is more costly.”

Nampower is building a 1,050 megawatt gas-fired plant that’s scheduled to begin producing electricity in as early as four years’ time. The power station will be located near the Kudu fields, which holds an estimated 1.3 trillion cubic feet of gas and is 200 kilometers (124 miles) offshore of the southern town of Oranjemund.

Construction has also begun on a 250-megawatt gas-fired plant in the western Erongo region, which is due to begin operating by the end of next year or early 2017.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE