GPG GRANT NUMBER TF0C3911 IBRD Fund for Innovative Global Public Goods Solutions Grant Agreement (Transmission Expansion and Energy Storage Project) between NAMIBIA POWER CORPORATION (PROPRIETARY) LIMITED and INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT acting as Trustee of the IBRD Fund for Innovative Global Public Goods Solutions GPG GRANT NUMBER TF0C3911 IBRD FUND FOR INNOVATIVE GLOBAL PUBLIC GOODS SOLUTIONS GRANT AGREEMENT AGREEMENT dated as of the Signature Date between NAMIBIA POWER CORPORATION (PROPRIETARY) LIMITED (“Recipient”) and INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (“Bank”), acting as Trustee of the IBRD Fund for Innovative Global Public Goods Solutions. WHEREAS (A) the Recipient, having satisfied itself as to the feasibility and priority of the project described in Schedule 1 to this Agreement (“Project”) has requested the following financings to assist in the financing of the Project; (i) from the Bank a loan in the amount of one hundred million Dollars (USD 100,000,000) (“IBRD Loan”); (ii) from the Bank, acting as an accredited entity of the Green Climate Fund (“GCF”), (1) a non-reimbursable grant in the amount of three million five hundred thousand Dollars (USD 3,500,000) (“GCF Grant”) and (2) a loan in the amount of twenty million Dollars (USD 20,000,000) (“GCF Loan”) (collectively “GCF Financing”); (iii) from the Bank, acting as Trustee of the IBRD Fund for Innovative Global Public Goods Solutions, a grant in an amount not exceeding fifteen million Dollars (USD15,000,000) (“GPG Grant”); (B) the Bank intends to: (i) advance the IBRD Loan to assist the Recipient in financing part of the cost of Part 1 of the Project on the terms and conditions set forth in the IBRD Loan Agreement (“IBRD Loan Agreement”) (as further defined in the Appendix to this Agreement); and (ii) enter into a Guarantee Agreement with the Republic of Namibia (“Guarantor”) in connection with the IBRD Loan Agreement concerning the IBRD Loan on the terms and conditions set forth in the IBRD Guarantee Agreement (“IBRD Guarantee Agreement”) (as further defined in the Appendix to this Agreement); (C) the GCF (through the Bank) intends to: (i) make available to the Borrower the GCF Financing to assist the Borrower in financing part of the cost of Parts 2 and the cost of Part 3 of the Project on the terms and conditions set forth in the GCF Financing Agreement (as further defined in the Appendix to this Agreement); and (ii) enter into a GCF Guarantee Agreement with the Republic of Namibia (“Guarantor”) in connection with the GCF Financing Agreement concernin g the -2- GCF Loan on the terms and conditions set forth in the GCF Guarantee Agreement (“GCF Guarantee Agreement”) (as further defined in the Appendix to this Agreement); and (D) the Bank, acting as Trustee for IBRD Fund for Innovative Global Public Goods Solutions, also intends to make available to the Borrower the GPG Grant to assist the Borrower in financing part of the cost of Part 2 of the Project on the terms and conditions set forth in this Agreement. NOW, THEREORE, the Recipient and the Bank hereby agree as follows: Article I Standard Conditions; Definitions 1.01. The Standard Conditions (as defined in the Appendix to this Agreement) apply to and form part of this Agreement. 1.02. Unless the context requires otherwise, the capitalized terms used in this Agreement have the meanings ascribed to them in the Standard Conditions or in the Appendix to this Agreement. Article II The Project 2.01. The Recipient declares its commitment to the objective of the project described in Schedule 1 to this Agreement (“Project”). To this end, the Recipient shall carry out the Project in accordance with the provisions of Article II of the Standard Conditions and Schedule 2 to this Agreement. Article III The Grant 3.01. The Bank agrees to extend to the Recipient a grant in an amount not to exceed fifteen million Dollars ($15,000,000) (“Grant”) to assist in financing the Project. 3.02. The Recipient may withdraw the proceeds of the Grant in accordance with Section III of Schedule 2 to this Agreement. 3.03. The Grant is made out of the IBRD Fund for Innovative Global Public Goods Solutions. -3- Article IV Additional Remedies 4.01. The Additional Event of Suspension referred to in Section 4.02 (k) of the Standard Conditions consists of the following, namely, that without the consent of the Bank, the Memorandum and Articles of Association of the Recipient, or the status of its incorporation pursuant to the Companies Act 28 of 2004, have been substantially amended, suspended, abrogated, repealed, or waived, including the formation of subsidiaries, so as to affect materially and adversely the ability of the Recipient to perform any of its obligations arising under or entered into pursuant to this Agreement, or to achieve the objectives of the Project. Article V Effectiveness; Termination 5.01 This Agreement shall not become effective until evidence satisfactory to the Bank has been furnished to the Bank that the conditions specified below have been satisfied, namely: (a) the execution and delivery of this Agreement on behalf of the Recipient have been duly authorized or ratified by all necessary governmental and corporate action. (b) the IBRD Loan Agreement, the IBRD Guarantee Agreement, the GCF Financing Agreement and the GCF Guarantee Agreement, shall have been executed and delivered and all conditions precedent to their effectiveness or to the right of the Recipient to make withdrawals under them (other than the effectiveness of this Agreement) have been fulfilled. 5.02. As part of the evidence to be furnished pursuant to Section 5.01(a), there shall be furnished to the Bank an opinion or opinions satisfactory to the Bank of counsel acceptable to the Bank showing on behalf of the Recipient, that this Agreement has been duly authorized or ratified by and executed and delivered on its behalf and is legally binding upon it in accordance with its terms. 5.03. Except as the Recipient and the Bank shall otherwise agree, this Agreement shall enter into effect on the date upon which the Bank dispatches to the Recipient notice of its acceptance of the evidence required pursuant to Section 5.01 (“Effective Date”). If, before the Effective Date, any event has occurred which would have entitled the Bank to suspend the right of the Recipient to make withdrawals from the Grant Account if this Agreement had been effective, the Bank may postpone the dispatch of the notice referred to in this Section until such event (or events) has (or have) ceased to exist. -4- 5.04. This Agreement and all obligations of the parties under it shall terminate if it has not entered into effect by the date one hundred and eighty (180) days after the date of this Agreement, unless the Bank, after consideration of the reasons for the delay, establishes a later date for the purpose of this Section. The Bank shall promptly notify the Recipient of such later date. Article VI Recipient’s Representative; Addresses 6.01. The Recipient’s Representative referred to in Section 7.02 of the Standard Conditions is its Managing Director. 6.02. For purposes of Section 7.01 of the Standard Conditions: (a) the Recipient’s address is: Namibia Power Corporation (Proprietary) Ltd NamPower Center 15 Luther Street PO Box 2864, Windhoek Namibia; and (b) the Recipient’s Electronic Address is: Facsimile: Email: +264 (61) 232 805 legal@nampower.com.na Treasury@nampower.com.na -5- 6.03. For purposes of Section 7.01 of the Standard Conditions: (a) the Bank’s address is: International Bank for Reconstruction and Development 1818 H Street, N.W. Washington, D.C. 20433 United States of America; and (b) the Bank’s Electronic Address is: Telex: Facsimile: 248423 (MCI) or 1-202-477-6391 64145 (MCI) -6- AGREED as of the Signature Date. NAMIBIA POWER CORPORATION (PROPRIETARY) LIMITED By _____________________________________ Authorized Representative Kahenge Simson Haulofu Name: __________________________ Managing Director Title: __________________________ 25-Nov-2024 Date: ___________________________ INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT acting as Trustee of the IBRD Fund for Innovative Global Public Goods By _____________________________________ Authorized Representative Satu Kahkonen Name: __________________________ Country Director for South Africa, Botswana, Title: ___________________________ 24-Nov-2024 Date: ___________________________ -7- SCHEDULE 1 Project Description The objective of the Project is to strengthen Namibia’s transmission network and enable integration of renewable energy generation. The Project consists of the following parts: Part 1: Auas-Kokerboom Transmission Line Engineering, procurement, and construction of an approximately 461 km 400kV Auas- Kokerboom backbone transmission line to run from the Kokerboom Substation to the Auas Substation and associated works, including supporting the operation and maintenance costs associated with the development and implementation of the transmission line. Part 2: Battery Energy Storage System (BESS) 2.1 Design, supply, installation, and commissioning of a utility-scale BESS with a capacity of approximately 45 MW/90 MWh, covering a variety of BESS use cases, to facilitate additional uptake of renewable energy generation and manage renewable energy variability. 2.2 Support the services of an Owner’s Engineer to supervise the development and implementation of the BESS project. Part 3: Technical Assistance 3.1 Improving the risk profile of renewable energy projects by inter alia: (a) carrying out technical studies on solar, wind and/or BESS project and associated evacuation line; (b) carrying out a bird study to monitor the effectiveness of mitigating measures undertaken on powerlines on bird life; and (c) providing transaction advisory support in procurement of solar, wind and/or BESS incorporating socio- economic aspects. 3.2 Enhancing socio-economic benefits of the Recipient’s projects and capacity through inter alia: (a) annual capacity building activities for the Recipient’s staff; (b) carrying out identified gender and women’s employment actions; and (c) establishing a systematic framework to incorporate socio-economic aspects in the design and implementation of the Recipient’s projects including activities to inform the socio-economic aspects of the renewable energy or BESS projects benefiting from transaction advisory support. -8- SCHEDULE 2 Project Execution Section I. Institutional and Other Arrangements A. Institutional Arrangements. Except as the Recipient and the Bank shall otherwise agree, the Recipient shall ensure that the Project is carried out in accordance with the provisions of Section I of Schedule 2 to the IBRD Loan Agreement, which are incorporated by reference into this Agreement with the following modifications, unless the context otherwise requires, the terms “Borrower”, “Loan” and “this Agreement” in Section I of Schedule 2 to the Loan Agreement, shall be construed, respectively, for purposes of this Agreement, as references to the Recipient, the Grant provided for in Section 3.01 of this agreement and this GPG Grant Agreement. Section II. Project Monitoring, Reporting and Evaluation Project Reports The Recipient shall ensure that each Project Report is furnished to the Bank not later than forty-five (45) days after the end of each calendar semester, covering the calendar semester. Section III. Withdrawal of Grant Proceeds A. General 1. The Recipient may withdraw the proceeds of the Grant in accordance with the provisions of: (a) Article III of the Standard Conditions; and (b) this Section; to finance Eligible Expenditures in the amount allocated and, if applicable, up to the percentage set forth against each Category of the following table. Category Amount of the Percentage of Expenditures Grant Allocated to be Financed (expressed in USD) (inclusive of Taxes) (1) Goods, works, non- 15,000,000 100% consulting services, and consulting services under Part 2 of the Project TOTAL AMOUNT 15,000,000 -9- B. Withdrawal Conditions; Withdrawal Period 1. Notwithstanding the provisions of Part A of this Section no withdrawal shall be made for payments made prior to the Signature Date except that withdrawals up to an aggregate amount not to exceed $3,000,000 may be made for payments made prior to this date but on or after April 1, 2024, for Eligible Expenditures. . 2. The Closing Date is December 31, 2029. -10- APPENDIX Section I. Definitions 1. “Anti-Corruption Guidelines” means, for purposes of paragraph 2 of the Appendix to the Standard Conditions, the “Guidelines on Preventing and Combating Fraud and Corruption in Projects Financed by IBRD Loans and IDA Credits and Grants”, dated October 15, 2006, and revised in January 2011, and as of July 1, 2016. 2. “Battery Energy Storage System” or the acronym “BESS” means an energy storage system that uses batteries to store and distribute energy in the form of electricity and associated connection infrastructure. 3. “GCF Financing” means the Grant and Loan referred to in paragraph (A) (ii) of the Preamble to this Agreement to contribute to financing Part 3 and 2 of the Project. 4. “GCF Financing Agreement” means the Financing Agreement for the Project between the Borrower and the Bank, acting as an Accredited Entity of the Green Climate Fund, dated the same date as this Agreement, as such financing agreement may be amended from time to time. “GCF Financing Agreement” includes all appendices, schedules and agreements supplemental to the GCF Financing Agreement. 5. “GCF Grant” means Loan referred to in paragraph (A) (ii) (1) of the Preamble to this Agreement to finance Part 3 of the Project, 6. “GCF Loan” means the Loan referred to in paragraph (A) (ii) (2) of the Preamble to this Agreement to contribute to financing Part 2 of the Project. 7. GCF Guarantee Agreement” means the guarantee agreement for the Project between the Guarantor and the Bank acting as an Accredited Entity of the Green Climate Fund, dated the same date as this Agreement, as such guarantee agreement may be amended from time to time. “GCF Guarantee Agreement” includes all appendices, schedules and agreements supplemental to the GCF Guarantee Agreement. 8. “Guarantor” means the Republic of Namibia, pursuant to the IBRD Guarantee Agreement and the GCF Guarantee Agreement (as herein defined). 9. “IBRD Guarantee Agreement” means the guarantee agreement for the Project between the Guarantor and the Bank, dated the same date as this Agreement, as such guarantee agreement may be amended from time to time. “IBRD Guarantee -11- Agreement” includes all appendices, schedules and agreements supplemental t o the IBRD Guarantee Agreement. 10. “IBRD Loan” means the Loan referred to in paragraph (A) (i) of the Preamble to this Agreement to contribute to financing Part 1of the Project, 11. “IBRD Loan Agreement” means the loan agreement for the Project between the Borrower and the Bank, dated the same date as this Agreement, as such loan agreement may be amended from time to time. “IBRD Loan Agreement” includes all appendices, schedules and agreements supplemental to the IBRD Loan Agreement. 12. “Owner’s Engineer” means a consultancy firm or individual appointed by the Borrower to provide it with technical advisory and project management services. 13. “Procurement Regulations” means, for purposes of paragraph 20 of the Appendix to the Standard Conditions, the “World Bank Procurement Regulations for IPF Borrowers”, dated September 2023. 14. “Signature Date” means the later of the two dates on which the Recipient and the Bank signed this Agreement and such definition applies to all references to “the date of the Grant Agreement” in the Standard Conditions. 15. “Standard Conditions” means the “International Bank for Reconstruction and Development and International Development Association Standard Conditions for Grant Financing Made by the Bank out of Trust Funds”, dated February 25, 2019.