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NamPower secures US$100 million financing for Otjikoto Biomass Power Station

NamPower secures US$100 million financing for Otjikoto Biomass Power Station

Power utility, NamPower has acquired over US$100 million in financing for the construction of the 40 MW Otjikoto Biomass Power Station.

Signed agreements last week on Friday encompass a loan agreement, engineering, procurement, and construction (EPC) contract, and woodchip fuel supply, marking pivotal progress on the project’s realization.

Kahenge Haulofu, Managing Director of NamPower, hailed the project as a pivotal solution to the longstanding need for a baseload power station in Namibia.

“This project will be one of the answers to the long-awaited realization of a baseload power station in Namibia,” said Haulofu.

He emphasized that the power station would empower NamPower to efficiently furnish baseload electricity, contributing significantly to the nation’s power generation expansion efforts.

Key to the project’s funding is the French Development Agency (AfD), which has extended a loan of up to 100 million euros. Additionally, the Mitigation Action Facility is contributing a grant of 25 million euros, with the French Fund for Global Environment offering 3 million euros for environmental research and extending project benefits to vulnerable communities.

The Otjikoto Biomass Power Station holds promise in reducing Namibia’s dependence on imported electricity by offering a stable and cost-effective baseload power alternative. It is poised to facilitate the integration of intermittent renewable energy sources such as wind and solar, thereby enhancing the nation’s energy resilience.

Moreover, the project is anticipated to deliver substantial environmental benefits by curbing greenhouse gas emissions through the replacement of high-emission electricity imports and the integration of renewable energy sources like solar and wind.

Addressing Namibia’s significant bush encroachment challenge, which impacts over 26 million hectares of farmland and results in substantial economic losses, Haulofu underscored the project’s potential. “Effective countermeasures through sustainable bush thinning programmes can help preserve biodiversity, restore the savannah and create massive economic opportunities,” he said.

Once operational, the Otjikoto Biomass Power Station will play a critical role in maintaining power quality within Namibia’s electricity grid.


 

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