IN THIS ISSUE:

Namibia’s second place ranking after Uganda in the African Development Bank (AfDB’s) 2018 Electricity Regulatory Index (ERI) report, is an achievement that needs to be celebrated by all.

ERI is composed of the Regulatory Governance Index (RGI), the Regulatory Substance Index (RSI) and the Regulatory Outcome Index (ROI). RGI

looks at the regulatory framework establishing the regulator, the clarity of the roles of the regulator, regulatory independence, and an independent body outside the regulator to resolve conflicts. RGI also looks that the openness of the regulator’s decision-making, a mechanism for the regulator to obtain views from all stakeholders and the predictability of the regulatory environment. ROI on the other hand measures, from the perspective of utilities, the degree to which the electricity sector regulators

have positive or negative impacts on the sector. It considers financial performance, technical quality of electricity supplied, and commercial quality of service and electricity access.

According to the report, the impact of the regulator’s actions and decisions for Uganda, Namibia and Tanzania, as viewed from the utilities [licensed power generation, transmission and distribution companies] perspective, seemed to have had a

CEO’s MessageCEO’s Message

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MSB(SO/MO)

IPPs

Imports

NP(G)

REDs,LA,&RC

Customer

EmbeddedIPPs

Exports

EligibleIPPs

NPCustomers

ContestableCustomer

CaptiveGeneration

CaptiveGeneration

Off-grid&mini-grids

ExistingarrangementNewoptionalarrangementSupplieroflastresort

ECB donate school material to Lianshulu and Mukorufu Primary in Zambezi | 7

Namibia second in Africa with best regulatory frameworks | 3

ECB moving closer to final ESI Market Structure | 4

May - July 2018

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It is humbling as an institution serving the Namibian people and the economy that the dedication, commitment and effort put into

service delivery is recognised. It is even more humbling when those recognising your hard work are outsiders.

Although it may sound small, the positive reviews by the utilities on the regulator, further motivates it to do even better. The fact that the regulator can walk tall, with its shoulders broad, is an incentive in itself and speaks of improvement, better days ahead.

Needless to mention, the biggest enemy to be weary of would be complacency. And neither the regulators, nor their host countries can afford to drop the ball going forward. This is extremely important as the countries’ individual efforts are reflective of the continent’s progress, if the African Development Bank (AfDB’s) 2018 Electricity Regulatory Index (ERI) report is anything to rely on.

It also goes without saying that the continent and her regulators are automatically benchmarked against their counterparts from across the world, and therefore cannot afford to delay proposed intervention

measures to align regulation in the energy sector to international best practices.

It is important to bear in mind however, that the country, or the regulator, needs the support of the entire value chain to achieve the desired results. Yes, that input role, no matter how small it is, will make a difference. The baton is in your hand and the clock has started ticking. So, make it happen!

Feel free to speak to us:Corporate CommunicationsElectricity Control Board8 Bismarck StreetP. O. Box 2923WindhoekTel: +264 61 374 311Fax: +264 61 374 305Visit our website: www.ecb.org.na

more positive impact on the performance of the utilities. For Namibia, this is reassuring as it speaks to the confidence in the market, and by extension the economy.

The Regulator is aware of the areas it needs to work on, to achieve consistency and improved ranking.

Regulatory governance

In terms of the ranking and how regulatory independence is defined and characterised in relation to governance and funding frameworks, Namibia has not done so well as the Regulator’s budget is currently approved by the Minister. Board members are appointed by the Minister and no clear criteria for the appointment exist. Licensing decisions are recommended by the Regulator and approved by the Minister.

What is required in terms of best practices and the survey, is that the appointment of Board members, and budget approval be independently done. However, if this has to change, it will require a policy decision. That will entail amending the sections of our current legislation. In terms of governance, Namibia is fully compliant with the current legislative environment.

In terms of what more can be done, energy efficiency is one of those areas where the regulator will have to do more in terms of policy development and enforcement, in consultation with other key stakeholders. Accountability

In terms of this ranking, AfDB defines accountability as the ability of the regulated entity or other stakeholders, as set out in the primary legislation, to challenge the regulator’s decision in the courts through an appeal to a commission or a specialized body. The fact that Namibia does not have an independent Tribunal or Body outside the Regulator to resolve conflicts or to deal with challenges to regulatory decisions, negatively impacts on accountability ranking.

In terms of our Common Law and also as per the Constitution, any decision including the decisions of the Regulator can be taken on High Court review by any aggrieved party. The new National Regulatory Authority (NERA) Bill has recommended the appointment of a tribunal body.

Regulatory independence

Independence is evidenced by the absence of regulatory capture by market players.

Regulatory independence refers to the formal independence from government and legislature; independence from stakeholders and market players; independence of decision making; and financial and budgetary independence.

Ensuring an “arm’s length” relationship with regulated entities reduces the ability of stakeholders to influence the decisions of the regulator. Regulatory independence ensures that decisions of the Regulator are independent and in the best interest of the industry its investors, the consumers and the country at large. This is important for certainty and role clarity. There are provisions for ensuring independence in the new National Energy Regulatory Authority (NERA) Bill.

Fortunately, the ECB does not need to reinvent the wheel to achieve the above. A visit to Uganda is imminent. But that does not stop the ECB to also learn from Tanzania, Nigeria, Ghana, Malawi, Kenya, Cameroon, South Africa, Togo, Senegal, Côte I’voire, Lesotho, Zimbabwe and Gambia. Although these countries tailed Namibia in the AfDB’s 2018 Electricity Regulatory Index (ERI) report, there are some areas where they performed better, and therefore worthy of a learning visit.

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Namibia second in Africa with best regulatory frameworks

Uganda and Namibia have the best regulatory frameworks in the power sector, while Lesotho, Zimbabwe and Gambia have ranked the lowest out of 15 countries studied by the African Development Bank in its first Electricity Regulatory Index for Africa.

The report, released for the first time this year, looked at both the development of regulatory frameworks and the impact of regulatory frameworks on the performance of the electricity sectors. The report noted key challenges, areas of improvement, funding processes, technical analysis and strategy. The countries studied were Cameroon, CÔte d’Ivoire, Gambia, Ghana, Kenya, Lesotho, Malawi, Nigeria, Senegal, South Africa, Tanzania, Togo, Uganda, Zambia and Zimbabwe.“African governments, with the support of development partners, including the African Development Bank, have made material progress in recent years in reforming and building capacity among policymakers and regulators in their respective electricity sectors,” said Amadou Hott, Vice President of the bank, in the report.

“Although the establishment of electricity sector regulators in Africa has been associated with numerous challenges, progress has

nevertheless been made. Over the last decade, over thirty African countries have established electricity sector regulators. Private sector participation and improvements in overall sector performance, however, are only likely to happen once electricity sector regulation is enhanced to facilitate additional necessary reforms,” added Hott.

In efforts to improve the power sector, the index will be a means to identify the challenges, developmental areas, legal, policy and regulatory frameworks within power sectors of African countries.

Although many sampled countries had established the legal and institutional frameworks for electricity sector regulation, regulators are yet to build an adequate level of capacity and develop appropriate mechanisms to effectively carry out their mandates and make decisions under key aspects of regulatory substance, the report states.

Initially, the AfDB sent surveys to 25 regulatory institutions and utilities in Africa, but only 15 countries answered the survey and participated in the study.

The regulatory system has a key role in attracting private investment into the energy and power sectors; and security, transparency and good governance are crucial in further developing the sector. The implementation of sound regulatory systems across the continent will ensure that Africa is equipped to build investor confidence in its environment and allow financial institutions to mobilize the financing needed to deliver universal electricity access.

The Electricity Regulatory Index for Africa (ERI) was released on the sidelines of the 2018 Africa Energy Forum (AEF) which took place in Mauritius from 19 to 22 June.

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ECB moving closer to final ESI Market Structure

The ECB is moving closer to fanalising the revised Namibian Electricity Supply Industry (ESI) Market Structure.

The ECB held its third and final stakeholder consultation workshop on the review of the Namibian ESI Market Structure on 4 July in Windhoek. The workshop was well attended and deliberated on the concept market design, which included stakeholders’ views and inputs which were collected during the previous two workshops.

At those workshops, stakeholders discussed the market structure concept that best align with the electricity industry in Namibia. The ECB went back and developed the concept into a Draft Market Model. One of the recommendations was to enhance the current Single Buyer Model into a Modified Single Buyer Model. The Modified Single Buyer model gives producers the opportunity to ‘by-pass’ the Single Buyer by selling directly to contestable customers.

Under the current Single Buyer Model only NamPower can buy power from generators with a few exceptions including some embedded generators connected to distribution licensees, self or captive generation and off-grid mini-grids.

Another fundamental recommendation was to change the trading arrangements in the market to allow bilateral wheeling transactions from Eligible Producers to Contestable Customers.

The fact that Independent Power Producers (IPPs) can sell directly to customers, effectively addresses one of the key concerns with the Single Buyer Market Model, which is that the utility has a conflict of interest when acting as both a producer and sole off-taker of power.

While agreeing that redesigning the market model will provide benefits to the Namibian economy, stakeholders stressed that the new market structure will require a clear outline of the roles and responsibilities for all participants

to eliminate some of the concerns that were raised such as:

a. fears about the security of supply, and who will take on the responsibility of the supplier of last resort;

b. correct allocation of costs and charges with the unbundling of the current tariff structure;

c. sustainability of the industry and the long term financial viability of licensees;

d. mitigation strategies for unplanned risks with the implementation of the revised market structure.

Stakeholders were however urged to see opportunities for new business concepts and revenue streams as well as for the country to leverage its world-class renewable energy resources to provide low cost electricity to benefit citizens including in neighbouring countries.

1

MSB(SO/MO)

IPPs

Imports

NP(G)

REDs,LA,&RC

Customer

EmbeddedIPPs

Exports

EligibleIPPs

NPCustomers

ContestableCustomer

CaptiveGeneration

CaptiveGeneration

Off-grid&mini-grids

ExistingarrangementNewoptionalarrangementSupplieroflastresort

A power point presentation slide on the proposed Stage 1 Trading Arrangements for the Modified Single Buyer.

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45MW solar PV plant outside Mariental nearing completion

A 45MW solar PV plant being built by local Independent Power Producer (IPP), Alten Africa, outside Mariental in the Hardap region is nearing completion. The plant, scheduled to be completed in September this year, will have an installed capacity of 45.5MWp for an output of 37MWac and is estimated to cost around N$840 million to complete.

It will occupy a large land area of 100 hectares, making it one of the biggest in Namibia. It will boast around 140,000 crystalline silicon panels mounted on solar trackers and will meet at least 3% of Namibia’s total electricity needs.

Once in production the solar PV plant will upload about 112GWh of clean electricity onto the national grid, enough to meet the annual electricity needs of over 70,000 households. The added megawatts will also greatly reduce Namibia’s dependency on energy imports from its neighbours during daylight hours, and is considered a huge step forward for the country becoming more self-sufficient and fulfilling the energy targets as set out in the Harambee Prosperity Plan.

NamPower launched a tender in May 2016 to

procure an Independent Power Producer

(IPP) developer for a solar PV power plant on a site adjacent to its Hardap Sub-station, near Mariental. NamPower procured the land and the Environmental Clearance Certificate for the development.

This will be the first large scale grid-connected PV power generation plant to be added to NamPower’s energy supply mix, following the smaller (5MW) Renewable Energy Feed-In Tariff (REFIT) projects.

Picture for illustration only.

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Correct circuit breaker sizing important for businesses and households

Private sector urged to invest in Off-Grid energy generation systems

The private sector has been urged to consider investing in off-grid energy generation systems in order to bring electricity to remote communities.

The call was made by ECB CEO, Foibe Namene, while addressing captains of industry at the Mining Conference & Expo in Windhoek in April. Namene stressed that it was important that the private sector come on board as the majority of the Namibian population resides in off-grid areas but not much was being done to give them access to electricity.

Off-grid systems, also called stand-alone systems, provide electricity on a 24/7 basis without the availability of the utility grid. In remote areas where grid electricity is not available, firewood and diesel generators, which are not economically and environmentally friendly, are used as a source of energy.

Government has developed a number of documents as well as specific initiatives such as the Off-grid Energisation Master Plan (OGEMP) to

Circuit breakers are designed to activate (open the circuit) when the electrical current is in excess of the device rating. This is done to protect both the electrical device and the wiring. As such, it is important to select the correct circuit breaker to meet the electrical circuit needs as well as prevent overheating and damage to the wiring.

For business owners and households, correct circuit breaker sizing is important because different circuit breakers for premises attract different capacity charges for different licencees. Normally, the highter the rating of the circuit breaker, the higher the capacity charge. It’s therefore important that circuit breakers are adequately rated and not oversized or undersized.

But how will business owners and households know if their circuits are correctly sized?

If you find that breakers in your home or

commercial property frequently trip, cutting off power to a certain section of the building, you should call an electrician for an electric safety inspection as soon as you can. This can be a sign of faulty wiring or an overloaded breaker.

Beyond the inconvenience of constantly having to visit the breaker box to flip the switches, these

problems can lead to sparking, electrical fires, and other serious dangers. The circuit breaker should be a safety feature, not a safety hazard.

How will a qualified, registered electrician or electrical company fix the problem? Often, an electrician can fix your breaker problems simply by rewiring the panel. In some cases, however, your building may need electrical panel upgrades. Today’s

electrical usage, with computers, phone chargers, televisions, broadband routers, and much more, far exceeds that of even two decades ago.

Sizing would depend on anticipated items to be supplied with electricity in the premises.

By Lameka Amuanyena

Picture for illustration only

support the electrification of remote areas mainly through renewable energy. The OGEMP aims to provide access to energy through an Energy Shop model.

The plan is to establish energy shops within reasonable distances of the targeted communities. Private end users access the technologies through an ownership model and government institutions are being energized through the current public infrastructure model. Emphasis is placed on energy technologies and appliances that utilise renewable energy and energy efficiency.The energy shops also serve as payment collection centres for the national off-grid energy financing mechanism, thus working hand in hand with the Solar Revolving Fund (SRF) administrator.

Each of the 14 regions have at least one energy shop established so far with limited success, underlying the need for more robust off-grid electrification initiatives that need private sector involvement.

Picture for illustration only

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The ECB donated close to N$ 65 000 worth of stationaries, books and science equipment to the Lianshulu and Mukorufu Primary Schools in the Judea Lyaboloma Constituency of the Zambezi region.

At the handover ceremony, ECB CEO, Foibe Namene, stressed the importance of education to nation building and national development.

“Education is the most powerful weapon one can use to change the world. For the

developing countries, if we want to catch up with development, we must catch up in education first,” said Namene.

Receiving the educational material, Judea Lyaboloma Constituency Councillor, Beaven Munali, applauded the ECB for the donation stressing that it will go a long way in helping to improve performance in the region.

“The two schools face a severe shortage of educational materials, which contribute to poor

performance. It is my hope that the donation will improve the academic performance of leaners.”

Munali urged the school boards and principals of the two schools to ensure that the educational materials were used for the intended purpose.

The principals of the two schools thanked the ECB for its commitment to the education of the Namibian child and the future of the Namibian economy.

ECB’s Corporate Social ResponsibilityECB donate school material to Lianshulu and Mukorufu Primary in Zambezi

ECB’s Manager for Human Resources, John Mukoya (in navy suit), handing over educational materials on behalf of the CEO at Lianshulu village in the Zambezi region.

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Sparky Moments

Tonateni Amakutuwa (left) and Gideon Nasima (far right) with officials of local Independent Power Producer (IPP) InnoSun.

Charity Nsofu preparing to make a presentation on behalf of the ECB at the Conference on Solar Power Systems for Namibia at the Greiters Conference Centre outside Windhoek.

Esther Heita (left) and Lydia Mlunga (center) sharing a light moment with a workshop participant at NIPAM in Windhoek.

Pinehas Mutota, Manager: Economic Regulation (left) comparing notes with General Manager: Regulation, Rojas Manyame.

ECB Board Chairperson, Gottlieb Hinda, front with brown tie welcoming the Minister of Mines and Energy, Tom Alweendo (purple tie), and his deputy Kornelia Shilunga (red dress) to ECB House.