The Department of Electricity for the City of Windhoek spoke to ECP about its low and sustainable electricity tariffs and smart metering solutions that have enabled cost savings for consumers.
How does the Department of Electricity ensure reliable electricity access to the City of Windhoek?
We have comprehensive maintenance plans in place to ensure that our infrastructure is performing optimally and in-line with world-class standards. We work based on a cost-recovery model, where we recover all the costs we incur from the electricity tariff. Our tariffs are cost-reflective, which makes us sustainable. We have also implemented smart metering solutions for our large customers, enabling us to obtain remote meter readings. Our commercial and technical losses are below 10%, currently sitting at around 7-8%. We outsource very little; outsourcing is mainly focused on construction and labor-intensive work. All in all, we run an efficient utility.
Electricity connections are approved by your office. How do you see grid access expanding?
In the planned or formalized areas of the city, we have achieved almost a 100% grid access rate. However, in the peri-urban areas around Windhoek, where many people live in corrugated iron houses, our grid access is quite low. To address this, we have implemented a program to connect around 800 houses to the grid annually, with significant funding from our central government through the Ministry of Urban and Rural Development. With this funding, we’ve been able to increase access to electricity in Windhoek. Due to a high rate of urban migration, it’s crucial for the city to continue addressing the backlog and connect as many people as possible in the informal areas surrounding Windhoek to the grid.
What role are public enterprises playing in streamlining Namibia’s power sector and enabling cost savings for consumers?
We import a lot of our energy. However, our local regulator has approved a net metering policy, which allows households and businesses to install solar panels onto their rooftops. Under this system, customers receive a rebate on their consumption and any excess energy generated is fed into our grid. There are limits, and excess energy cannot be carried over multiple years. Even though the number of our customers is growing, we’ve seen a decline in energy purchases coming from NamPower because more people are generating their own energy using solar panels. The regulator has also launched the MSB (modified single buyer), which allows clients who consume more than one megawatt to buy up to 30% of their energy from third parties. The idea is to reduce reliance on NamPower because solar energy is much cheaper than the energy bought from NamPower. That cost saving is passed to the clients, making the City of Windhoek’s electricity tariffs, the lowest electricity tariffs in the country.
What are the most promising power infrastructure projects currently underway in Namibia?
ZIZABONA is a key project. Namibia already has strong transmission lines towards South Africa and a good connection to Zambia. We also have access to Zimbabwe and the central SAPP transmission corridors. The ZIZABONA project unlocks the value of the Copperbelt with the DC link feeding north to Zambia. Another project is the Angola-Namibia interconnection project. Currently, Angola has quite a lot of power available, but it doesn’t have the means to export that power to the region. However, once those projects come on board and connect with the Angolan backbone, that will create another route where we can access reasonably cheap hydropower and gas power from Angola. Namibia has started constructing several upgrades strengthening the central transmission corridor. Another route would be the ZIZABONA to Botswana. Although Botswana is blessed in coal, this project will help them access cleaner forms of energy that are readily available in the SADC.
What role will new hydrocarbon development play in Namibia’s energy mix?
There’s a lot that can be done in power generation, especially considering that hydrocarbon-based energy solutions are dispatchable and flexible. They complement renewable energy solutions quite well, by providing power capacity when renewable solutions are not able to provide the required power capacity. When there is variability in solar or wind solutions, hydrocarbons can easily fill the gap. The discovery of hydrocarbons in Namibia will enhance renewable energy solutions, since we will be able to put more of that uncertain energy on grid, given our secure source of dispatchable energy.
Energy Capital & Power is a strategic partner of the Namibia International Energy Conference (NIEC) – taking place in Windhoek on April 23-25, 2024. The 6th annual conference unites industry leaders, business executives and policymakers to engage in dialogue, exchange ideas, create new partnerships and identify strategies to foster a prosperous energy industry in Namibia and beyond. For more information, please visit https://www.nieconference.com/
