SDG Namibia One Fund, Namibia’s dedicated green H₂ blended finance vehicle and the designated funding partner to Government of Namibia’s green H₂ initiatives, and Hyphen Hydrogen Energy have concluded a share subscription agreement, following which the Fund will take up a 24% stake in the country’s landmark Hyphen green H₂ project. The Fund’s equity subscription will be backed by an initial €23 MM development funding to the project.

SDG Namibia One is a blended finance vehicle focused on green H₂ projects and related infrastructure in Namibia. Blended finance is seen as critical for the nascent green H₂ industry, offering the advantage of reducing transaction costs and accelerating high-quality project development, ultimately leading to quicker investment decisions, expedited project delivery, and proof of concept.  The Fund seeks to raise $1 B from public and private investors in Namibia and globally.

The Fund is jointly managed by Climate Fund Managers (CFM), a climate-centric blended finance fund manager, Dutch development financing institution Invest International and the Environmental Investment Fund of Namibia (EIF). EIF’s involvement ensures direct access and ownership for the Government of Namibia (GRN) in the project, whereas CFM and Invest International bring in the required institutional and funding capacity.

The project, which will be developed on 4,000 km² of land within the Tsau ||Khaeb National Park, is Namibia’s first fully vertically integrated GW-scale green H₂ project and the largest green H₂ production project in Sub-Saharan Africa. Upon completion of Phases 1 and 2, it will produce 2 MMtpy of green ammonia (a H₂ derivative that is easier to transport) from ~7 GW of predominantly wind and solar renewable energy generation capacity and ~3 GW of electrolyzer capacity. The project will avoid an estimated 5 MMtpy–6 MMtpy of CO₂ emissions.

The Hyphen project will be a catalyst for economic growth in Namibia and will turn the country’s green H₂ ambitions into reality.

Hyphen estimates that the project across Phases 1 and 2 will create up to 15,000 new jobs during the construction phase and 3,000 permanent jobs during its operation on completion of both phases, with the target for 90% of these jobs to be filled by Namibians with 20% specifically targeted for youth. The project further estimates 30% local procurement of goods, services and/or materials during the construction and operational phases. These figures will be validated by Hyphen and GRN through comprehensive baseline studies conducted during the feasibility phase, with GRN undertaking its own baseline studies in parallel.

COP28, which recently took place in Dubai, was focused on bringing financial investment to the Global South. To Hyphen’s knowledge, this is the first large-scale project, where a government has procured and contracted a significant green ammonia initiative in Africa and through an innovative financing partnership.

Hyphen, whose shareholders include renewable power developer Enertrag and infrastructure developer Nicholas Holdings Ltd, was announced as the preferred bidder in 2021 for the project.

Marco Raffinetti, CEO of Hyphen Hydrogen Energy said, “Ever since we started working with Government, we have ensured that this project creates a new global standard for the sustainable and equitable development of international large-scale green H₂ projects. Namibia’s equity stake and its management through this new fund is truly world leading and provides a template for future projects in Namibia and abroad. We would like to show our gratitude and thanks to Government and our partners in this project.”

Joost Oorthuizen, CEO of Invest International said, “Today’s announcement reinforces Namibia’s position as a leader in the global green energy movement and the Government’s continued commitment to realizing the potential of the green H₂ sector for all Namibians.”

Andrew Johnstone, CEO of Climate Fund Managers said, “Green H₂ has a pivotal and unique role to play in achieving net-zero targets by 2050. The Hyphen project, groundbreaking in both scale and impact, is a masterclass in how the public and private sectors can work together to unlock the potential of this exciting new sector, driving economic growth for Namibia and a greener, more resilient future.”

Benedict Libanda, CEO of the Environmental Investment Fund of Namibia said, “With the acquisition of a 24% equity stake in the Hyphen Green H₂ Project, we are not just investing in a project, but we are catalyzing Namibia’s journey towards global leadership in green H₂ production. This milestone is also a steppingstone for green industrialization in Namibia, marking our commitment to shaping a cleaner and more sustainable tomorrow.”