DAY 2 - The 18th Annual Conference of the Arab Society for Economic Research
DAY 1 - The 18th Annual Conference of the Arab Society for Economic Research
Bridging the Gender Gap: Investing in Women and Girls in Africa
Sign up with your email to get all our news, programs and information
AfricaAsiaAmericas and CarribeanAtlanticEuropeMENAPacific and Oceania
Morocco is facing major challenges in terms of its future energy supply and demand. Specifically, the country is confronted with rising electricity demand, which in turn will lead to higher fossil fuel import dependency and carbon emissions. Recognizing these challenges, Morocco has set ambitious targets for the deployment of renewable energy sources for electricity generation (RES-E). The realization of these targets will lead to a fundamental transition of the Moroccan electricity sector and requires substantial public and private investment. However, different risks constitute barriers for private RES-E investments and lead to high financing costs, which may eventually discourage capital-intensive RES-E projects.
While the existing literature has mainly focused on assessing the impact of financing costs on the economic competitiveness of individual technologies, the aim of this research is to assess the techno-economic feasibility of different electricity generation portfolios. To recognize the social dimension of the sustainable energy system transition, the electricity scenarios for Morocco have been jointly developed with stakeholders in a scenario building workshop in Rabat, employing a downscaled version of the open source electricity market model renpassG!S, augmented by a weighted average cost of capital (WACC) module.
In the stakeholder workshop, four different electricity scenarios for Morocco were co-developed. Each of these scenarios describes a consensual and technologically feasible future development path for the Moroccan energy system up to 2050, and comprises conventional fossil fuel-based technologies, as well as RES-E technologies in varying shares. Employing the downscaled renpassG!S model, we find that total system costs, as well as average levelized costs of electricity (LCOE) can be reduced substantially with low-cost financing.
Our results indicate that de-risking RES-E investments can lead to cost competitiveness of a 100% RES-E-based electricity system with mixed-technology scenarios at marked financing costs. Therefore, we identify specific de-risking recommendations for Moroccan energy policymaking. In addition, we argue that participatory scenario modeling enables a better understanding of the risk perceptions of stakeholders, and can eventually contribute to increasing the political feasibility of sustainable energy transition pathways.
As a result, an ambitious target was set for further deployment of renewable energy sources in the electricity sector (RES-E). This target foresees high penetration rates of RES-E, namely 42% of total generation capacity by 2020, and 52% by 2030 [10]. As 1 of 40 member nations of the Climate Vulnerable Forum, Morocco jointly declared the goal of reaching 100% RES-E supply between 2030 and 2050 [11]. These targets will require an additional deployment of roughly 10 GW of RES-E capacities by 2030. From those, 4.6 GW is foreseen to come from solar, 4.2 GW from wind, and 1.1 GW from hydro.
Back in the 1990s, Morocco launched an electricity program that aimed to ensure access to electricity for rural households. Moreover, a controlled liberalization of the country''s electricity generation was initiated with the signing of the first Power Purchase Agreements (PPAs) with independent power producers. The demand for electricity almost tripled from 13.265 TWh in 1999 to 35.405 TWh in 2016 [43]. Further, access to electricity in rural areas increased from 18% in 1995 to 99.42% in 2016 [43]. The installed power mix in Morocco as of 2016 is presented in Table 1 [43].
Currently, Morocco is relying on the development of RES-E power plants to meet the rising electricity demand and to achieve the energy shift as framed in the energy strategy launched in 2009 [44]. The strategy covers five areas:
Establishing an optimized fuel mix in the power sector
Increasing deployment of RES technologies in power generation
Promoting private investments in the power sector
Promoting energy saving and use efficiency in the industrial, commercial, and residential sectors
Promoting regional power grid integration.
According to this strategy, Morocco will have the following installed power mix [43]:
By 2020, the installed capacity will reach 13,320 MW of which 48% will be RES-E based (2000 MW solar, 2500 MW wind, and 1820 MW hydropower)
By 2030, the installed capacity will reach 21,200 MW, of which 52% will be RES-E based (4000 MW solar, 4000 MW wind, and 3100 MW hydro, including pumping stations).
Morocco is considering the development of marine pumping stations in order to back up the intermittent RES-E systems. In addition, the country is developing a USD 4.6 billion liquefied natural gas program in order to back up the intermittency of solar and wind energy power plants.
In order to establish effective financing mechanisms for fostering RES deployment in Morocco, the GoM established the "société d''investissements énergétiques (SIE)" in 2010. The SIE was designed as a public financial instrument in order to support and enable investments in RES projects by taking minor stakes in specific projects. Capitalized with approximately EUR 100 million, the GoM targets to leverage private national and international financial resources to invest in RES projects in Morocco.
In parallel, the GoM established in 2009 the "Fonds pour le développement énergétique" with a total capitalization of 1 Billion US$ to implement the national energy strategy. The fund was established by the annual financial law 2009 [45] and designed to assure investment in strategically important public RES projects.
Within the private financial sector, Moroccan Banks have been able to leverage optimized financing of EUR 1 billion per year to finance energy projects in the country [46]. The Moroccan banks join efforts within an instrument of Local Banks syndication.
Different investment risks—both objective and subjective—can lead to an increase in financing costs for infrastructure investments. Due to the high capital intensity of low-carbon RES-E technologies, high capital costs have a stronger impact on the economic feasibility of specific RES-E investments than on conventional fossil-based investment projects. Thus, high capital costs, sometimes expressed as high WACC [25, 27], lead to a strong increase in the LCOE from RES-E and therefore tend to discourage RES-E investments at scale. Financing costs for capital-intensive RES projects [22] are found to be particularly high in developing countries [23].
Our methodological approach reflects a case study analysis of low-carbon electricity pathways for Morocco, employing qualitative social science methods and quantitative techno-economic modeling tools. While other research activities on future power systems often focus on energy scenarios based on full-cost-optimization or long-term targets, the approach taken in this article puts emphasis on the inclusion of the views and estimates of diverse societal stakeholder groups about their anticipation of Morocco''s future power system. This approach was key to gaining a broad spectrum of potential future developments that have a high level of stakeholder buy-in. The researchers'' role was limited to providing the tools, and moderating and guiding the scenario development process [42].
About Electricity policy rabat
As the photovoltaic (PV) industry continues to evolve, advancements in Electricity policy rabat have become critical to optimizing the utilization of renewable energy sources. From innovative battery technologies to intelligent energy management systems, these solutions are transforming the way we store and distribute solar-generated electricity.
When you're looking for the latest and most efficient Electricity policy rabat for your PV project, our website offers a comprehensive selection of cutting-edge products designed to meet your specific requirements. Whether you're a renewable energy developer, utility company, or commercial enterprise looking to reduce your carbon footprint, we have the solutions to help you harness the full potential of solar energy.
By interacting with our online customer service, you'll gain a deep understanding of the various Electricity policy rabat featured in our extensive catalog, such as high-efficiency storage batteries and intelligent energy management systems, and how they work together to provide a stable and reliable power supply for your PV projects.
