For the first time, green hydrogen production is taking place in Namibia, primarily thanks to investments from Germany. This southern African nation has grand ambitions for an industry that remains in its infancy.
Within the Namib Desert’s lower slopes, even the beneficial rains from 2025 have scarcely made an impression. A handful of mountains provide variety against the predominantly dull brown terrain. However, it is within this area—approximately 120 kilometers northeast of the nation’s biggest harbor, Walvis Bay—that Namibia has established its newest initiative aimed at decreasing global greenhouse gases.
Close to the town of Arandis, 44,000 solar panels shine under the Namibian sunlight, taking advantage of nearly perfect conditions.
“Annually, we experience approximately 30 hours of overcast skies each year,” stated Johannes Michels, CEO of Hylron, which commenced production of the initial green hydrogen in Namibia towards the end of March.
The “Oshivela” initiative marks Namibia’s inaugural contemporary ironwork venture. However, distinct from traditional or “grey” ironworks, Oshivela generates “green iron” as it utilizes power derived from sustainable energy sources.
Michels states that this development will position Namibia as “the first nation globally to produce iron industrially without releasing CO2.”
The concept proposed by Namibia’s former President Hage Geingob to
transform the Namibian economy
using hydrogen is beginning to be realized. The country aims to industrialize and create urgently needed jobs to curb the official unemployment rate of around 37%. Several energy initiatives have been developed in recent years, notably the Hyphen project in the Tsau/Khaeb National Park in southern Namibia.
It is anticipated that starting from 2028, approximately 1 million tons of green ammonia will be produced yearly, mainly for shipment to European and Asian markets.
However, the leading initiative has garnered significant interest as well as scrutiny. The Namibian Chamber of Environment (NCE) expresses concerns about potential irreparable harm to the delicate ecosystem within the national park. Hyphen dismisses these allegations and has declared plans for an extensive social and environmental impact assessment.
The first facility utilizing green hydrogen from plants now operational
Although the extensive Hyphen initiative remains an aspiration for later, the solar plant at HyIron is currently providing up to 25 megawatts of electrical power. This energy is utilized to operate two electrolyzers, which decompose water into
hydrogen
and oxygen.
Electrical energy enters a rotary kiln, facilitating the processing of iron ore sourced from South Africa. Hydrogen serves as a reducing agent within the furnace, extracting oxygen atoms from the iron ore.
What remains is pig iron for use in the steel industry. Additionally, hydrogen and oxygen recombine to form water, which is then used in a cycle to produce more hydrogen.
Michels is excited about Namibia’s potential for renewable green energy and eager to demonstrate that “there is a cost-effective alternative to combating climate change.”
The individuals in this region thoroughly understand the negative impacts of climate change. Previously, approximately 5,000 sheep roamed the land until a period ensued where no rainfall occurred for twelve consecutive years.
The farm owners had to sell, laying the foundation for one of the most promising decarbonization projects in Namibia.
Germany promotes Namibian hydrogen production
This is where Germany plays its role.
“Decarbonizing our steel sector is essential,” stated Rainer Baake, who serves as the German government’s special envoy for Namibian-German hydrogen ties.
“So far, iron reduction in Germany has been carried out using coking coal, making it highly carbon-intensive as a result,” Baake explained to ecosundiaries.com.
This presents an opportunity for Namibia, where the hydrogen sector is slowly growing—frequently with financial support from Germany.
HyIron primarily consists of German investors, having received €13 million from the Federal Ministry of Economic Affairs and Climate Action. The only individual with Namibian connections is Managing Director Michels.
The Federal Ministry of Education and Research is providing approximately €22 million for two additional initiatives, whereas Enertrag, an energy firm based in eastern Germany, holds the largest stake in Hyphen.
However, the
initiative for the collaboration
Originally hailing from Namibia, highlighted Baake.
According to economist Robin Sherborne, this constitutes precisely the correct strategy when addressing the primary factors contributing to climate change.
He informed ecosundries.com that financing for this transformation should come from the private sector and the governments of affluent nations.
How does Namibia benefit?
Sherbourne cautioned, however, that subsidies would not suffice on their own, and he expressed doubts regarding the possible advantages Namibia might gain from entering the hydrogen sector.
Foreign exchange earnings or perhaps some tax revenue”—said Sherbourne—but warned that “should the sector remain commercially inactive for an extended period, it will likely generate minimal profit.
HyIron has initiated production and, as claimed by the company, it is already able to match the cost of traditionally manufactured “gray” iron.
“We won’t be making substantial profits immediately, but it will be enough for us to sustain ourselves,” said Johannes Michels, CEO of Hylron, during an interview with ecosundries.com.
Overall, the firm still considers itself more of an innovator. As Michels stated, “Our primary objective is to demonstrate that it functions.”
At first, HyIron will have the capacity to manufacture 15,000 tons of emissions-free iron annually. Expansion approval to reach 200,000 tons might be granted later this year.
And by 2030, the capacity could be expanded to 2 million tons. The company would then be in a position to increase the number of permanent jobs from an initial 50 to 1,600.
HyIron is also pushing ahead with training and further education to expand local capacities.
Michels stated that Namibia has the potential to yield several hundred million tons of iron annually.
Absence of purchase agreements — a hurdle for Namibia
At present, insufficient demand is hindering the progress of “green iron.” It still cannot compete with production methods that harm the climate. There are few purchase agreements for green hydrogen products made in Namibia.
As per Baake, this can also be attributed to the present market conditions. The complete execution of the EU’s
Carbon Border Adjustment Mechanism,
The surcharges aimed at counterbalancing the competitive edge of steel produced through environmentally harmful methods will be implemented gradually until 2034.
Baake refers to a “drought” during this time and believes the newly formed German government needs to take action.
“Simply implementing emissions trading won’t result in agreements being made here,” he stated to ecosundries.com.
One potential approach suggested by Baake involves imposing compulsory quotas for eco-friendly products, such as in German farming or the steel sector. These sectors could subsequently reduce their carbon footprint through the use of green iron sourced from Namibia.
Economic expert Sherbourne is calling for long-term commitments from Germany: “If our industry here is dependent on Germany and things change, there is a risk that we will be stuck with our industry here.”
The first hydrogen shipments have been exported to Germany, yet Namibia aims for self-reliance.
HyIron is the inaugural hydrogen firm in Namibia to secure a purchase agreement. The client is Benteler, a German auto parts manufacturer. Initially, they aimed to produce 200,000 tons of emissions-free iron annually.
The size of the actual delivery volume is still uncertain. HyIron has chosen not to disclose any details about it, and Benteler did not respond to a request for comment from ecosundiaries.com.
Despite this, James Mnyupe remains extremely satisfied with these advancements. As the hydrogen commissioner of Namibia and the leader of the country’s hydrogen initiative, he oversees the government’s efforts in this sector.
“This completely alters how people envisioned green hydrogen production being managed in Namibia,” Mnyupe stated to ecosundiaries.com.
“They thought we would export the molecules and they thought they would go to Europe.”
Instead, he envisions a local hydrogen market, with products used or refined in Namibia.
There are proposals to establish large-scale ammonia storage facilities in Namibia to supply fuel for container ships, railway locomotives, and trucks within the country.
Mnyupe outlined a Namibian logistics center featuring a low-emission transportation network via sea, road, and rail. This initiative aims to reduce the nation’s reliance on potential procurement agreements in Germany.
He likewise criticizes his own administration. Countries including South Korea, Egypt, and Morocco have already started investing in their respective industries, Mnyupe informed ecosundiaries.com.
“Maybe we’ll reach that stage in a few years once it becomes evident that this sector thrives here, but eventually, you must begin sustaining yourself,” stated Mnyupe.
Hydrogen for Namibia: An Economic Inquiry
For Mnyupe, efforts towards global decarbonization are not as high a priority.
“He stated that the focus isn’t on the climate but rather on economic factors such as money and the overall economy.” He then introduces his proposed carbon dioxide taxes to encourage the buying of hydrogen goods sourced from Namibia.
In the meantime, HyIron’s appeal extends beyond Germany; representatives from Japan’s renowned carmaker Toyota toured their facilities. They have shown an interest in acquiring stakes as well as exploring options for importing emissions-free iron. This development comes at a time when neighboring South Africa, known for assembling vehicles destined for European markets, also takes notice.
The article was initially composed in German and revised by Keith Walker.
Author: Jasko Rust (from Windhoek)