RWE Withdraws from Namibia's Hydrogen Project

The energy giant RWE has announced its withdrawal from a planned project aimed at producing green hydrogen in Namibia, marking a significant shift in its strategy. The company had initially set ambitious goals to source up to 300,000 tons of green ammonia annually from Africa starting in 2027. However, recent evaluations have led to this unexpected decision.

A spokesperson for RWE confirmed the company's exit, citing a slower-than-anticipated demand for hydrogen and its derivatives in Europe. This reassessment comes after a review of various projects, including the Namibian initiative, which was conducted at the end of the previous year.

Hydrogen is increasingly viewed as a crucial alternative to fossil fuels and an essential component of the energy transition and climate protection efforts. It is produced through the electrolysis of water using electricity generated from renewable sources. Green ammonia, which is produced from hydrogen and nitrogen, can be efficiently transported by ships, making it a viable option for international trade.

In 2022, RWE had signed a memorandum of understanding with the consortium Hyphen Hydrogen Energy, which included the German energy firm Enertrag, to develop the green hydrogen project in Namibia. The plan aimed to produce approximately one million tons of green ammonia for export by 2027.

As the world moves towards a climate-neutral economy, hydrogen is expected to play a pivotal role, with a significant portion needed to be imported for use in Germany. The gas is expected to become a key energy source in new gas power plants, especially during periods when renewable energy production from wind and solar sources is insufficient.

In addition to energy generation, hydrogen is anticipated to replace coke in steel production, significantly reducing carbon dioxide emissions. Its application is considered vital for achieving climate neutrality in sectors such as steel, chemicals, shipping, and heavy-duty transport.