German investor plans N$8,3 billion coal power plant

INVESTORS in the electricity sector are flocking to Namibia with proposals to set up power plants because of electricity shortages expected in Southern Africa over the next two years.

The Electricity Control Board (ECB) has received a licence application from a company which intends to build a coal-fired power station at Walvis Bay which will produce 700 megawatt (MW) of electricity. According to the application documents, the coal plant will cost 826 million euros or N$8,3 billion.This is approximately N$2 billion more than the envisaged Kudu gas plant, which is to cost some N$6 billion and on which an investment decision is expected early next year.Henner Diekmann, a Namibian lawyer who is handling the legal side of BINVIS Investments 37, which applied for the coal power station licence, told The Namibian yesterday that a German investor was behind the project.”I cannot reveal the name yet, but he is an experienced investment banker, who in the meantime set up his own investment company which operates in several countries,” Diekmann added.”We are busy organising the shareholding, which will include Namibian shareholders of course.”According to Diekmann, experts conducted a thorough feasibility study and came to the conclusion it was a viable project and excess electricity would be exported to South Africa.According to the licence application documents, the investment for what is called a clean coal plant will come to N$8,3 billion.The electricity produced will cost the investors about 32,4 cents per kilowatt hour (kwh) and they intend to sell it at 36 cents per kwh.Potential customers identified would be NamPower and local authorities.The plant is to be erected on the harbour premises of NamPort at Walvis Bay and it requires some 600 cubic metres of desalinated seawater per day.Potable water requirements will come to 80 cubic metres per day.Coal-supply ships will dock at the quay just a few metres away from the plant.The lifespan of the proposed plant is calculated at 50 years, but the applicants noted that the plant will have to be shut down for two to three weeks every year for “for inspection and small repairs” and for eight weeks every four years.Every 15 or 20 years it must be shut down “for several months”, which raises the question of what effect the shutdowns will have on a stable electricity supply.Interested individuals and companies can scrutinise the documents at the offices of the ECB and if they have any objections to the project, they can submit them in writing to the ECB within three weeks.According to the application documents, the coal plant will cost 826 million euros or N$8,3 billion.This is approximately N$2 billion more than the envisaged Kudu gas plant, which is to cost some N$6 billion and on which an investment decision is expected early next year.Henner Diekmann, a Namibian lawyer who is handling the legal side of BINVIS Investments 37, which applied for the coal power station licence, told The Namibian yesterday that a German investor was behind the project.”I cannot reveal the name yet, but he is an experienced investment banker, who in the meantime set up his own investment company which operates in several countries,” Diekmann added.”We are busy organising the shareholding, which will include Namibian shareholders of course.”According to Diekmann, experts conducted a thorough feasibility study and came to the conclusion it was a viable project and excess electricity would be exported to South Africa.According to the licence application documents, the investment for what is called a clean coal plant will come to N$8,3 billion.The electricity produced will cost the investors about 32,4 cents per kilowatt hour (kwh) and they intend to sell it at 36 cents per kwh.Potential customers identified would be NamPower and local authorities.The plant is to be erected on the harbour premises of NamPort at Walvis Bay and it requires some 600 cubic metres of desalinated seawater per day.Potable water requirements will come to 80 cubic metres per day.Coal-supply ships will dock at the quay just a few metres away from the plant.The lifespan of the proposed plant is calculated at 50 years, but the applicants noted that the plant will have to be shut down for two to three weeks every year for “for inspection and small repairs” and for eight weeks every four years.Every 15 or 20 years it must be shut down “for several months”, which raises the question of what effect the shutdowns will have on a stable electricity supply.Interested individuals and companies can scrutinise the documents at the offices of the ECB and if they have any objections to the project, they can submit them in writing to the ECB within three weeks.