RWE's Withdrawal Alters Namibia's Green Hydrogen Aspirations
RWE has withdrawn from Namibia's $10 billion Hyphen green ammonia project, impacting the nation's goal to become a green hydrogen hub. Despite a 2022 non-binding agreement, slow demand in Europe led RWE to reconsider its investment. Concerns over indigenous rights also surrounded the project, although RWE denies any correlation.
- Country:
- Namibia
In a significant setback for Namibia's ambitions to position itself as a major player in green hydrogen, German energy giant RWE officially announced its withdrawal from the $10 billion Hyphen green ammonia project on Monday. The withdrawal underscores increasing industry skepticism about investing in this emerging yet costly technology.
Originally, RWE had a non-binding agreement with Hyphen in 2022 to purchase approximately 300,000 tonnes of ammonia annually starting in 2027. This compound, primarily used in fertilizers, requires a shift from natural gas production to a hydrogen-based process, necessitating renewable energy sources. However, European demand for hydrogen has not met expectations, prompting RWE to reconsider.
Despite RWE's statement that there is no connection between their withdrawal and indigenous rights complaints, the project faced criticism. Indigenous groups criticized the project for encroaching on ancestral Nama land within a national park. The European Centre for Constitutional and Human Rights praised the decision to avoid purchases from areas with rights violations, but RWE maintains its decision was purely market-driven.
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