The reforms are expected to improve private investors’ participation in the sector by introducing a net metering scheme for solar and wind plants connected to the high-voltage grid.
While the specific terms and conditions of the scheme are not yet set, investors in renewable power will be able to sell their surplus output to the grid, so long as this does not exceed 20% of their annual production.
The legislative changes have also opened up access to Morocco’s low-voltage distribution network, which should encourage development of small and medium-sized renewable power facilities.
Reducing reliance on imports
Although low oil prices saw the nation’s energy bill decrease by 28% in 2015, to $6.6bn, and the current account deficit shrink by almost two percentage points to 2.1% of GDP, the county’s dependency on global energy markets is generally seen as vulnerability.
Power consumption has grown annually by 5-6% since 1991, and as industrial activity expands and the population continues to grow, Morocco is expected to see a five-fold increase in energy demand by 2050.
The kingdom already fulfils 97% of its energy requirements through imports, so making use of the country’s renewable sources is seen as a key to expanding domestic production.
Harnessing solar energy
Central to meeting renewables targets is the Morocco Solar Plan (MSP), which was devised in 2009 to tap the country’s abundant solar potential – its annual irradiation levels are around 2.6 MWh per sq metre.
As part of the strategy, the kingdom earmarked $9bn for the development of photovoltaic (PV) and concentrated solar power (CSP) projects. As related projects come on-stream, the segment’s contribution to the energy mix is expected to reach 14% – or 2 GW – by 2020.
The biggest and most advanced of these is the $2.7bn Noor solar complex in the south-central town of Ouarzazate. The 2000-ha site will eventually have an installed capacity of 580 MW when completed in 2018.
The first phase of the project – Noor I – was bought on-line in February with an installed capacity of 160 MW, three-hour storage capabilities and the ability to provide 650,000 people with electricity from dawn until three hours after sunset.
The complex is one of just a few large-scale CSP projects in the world, but interest in the technology is growing due its ability to produce energy even in the absence of sunlight, thereby allowing for more competitive pricing mechanisms than with PV systems.
Morocco’s only other operational solar plant at present is the 470-MW Ain Beni Mathar combined-cycle station completed in 2010. The plant uses both thermal and solar power, with around 75% – or $381m – of its development funded by loans from the African Development Bank.
Blowing in the wind
As well as adding solar to the energy mix, the government plans to increase wind capacity from about 800 MW in 2015 to 2 GW in 2020, according to investment agency Invest in Morocco.
With more than 3500 km of coastline along the Atlantic Ocean and the Mediterranean Sea, and host to the Atlas and Rif mountain ranges, Morocco has high annual average wind speeds at several locations across its territory. Areas around the cities of Tangier and Tetouan are particularly suitable for wind farm development given the proximity to the national grid and wind speeds of 8.11 metres per second at 10 metres above ground level.
Supporting the country’s capacity expansion plans, a subsidiary of the Abu Dhabi National Energy Company (TAQA), called TAQA Morocco, is soon to begin construction on a 140-MW wind farm near Tangiers, with a 60-MW first phase to break ground in 2017.
Domestic firm Nareva developed Morocco’s largest wind farm, Tarfya, situated near the southern town of the same name. When finished in 2014, the complex added 300 MW of capacity to the 200 MW already generated by the company’s three existing wind energy projects in the country.
According to official estimates, the Tarfya station saves 900,000 tonnes of carbon dioxide emissions and around $200m in hydrocarbons imports each year.
Large-scale energy projects such as these, as well as Morocco’s hosting in November of the 22nd Conference of Parties to the UN Framework Convention on Climate Change, have helped the country begin to increase its profile in renewable energy production.
With the EU eyeing a deal to import renewable electricity from Morocco as part of plans to integrate the two energy markets, there is plenty of scope for the kingdom to develop this positive reputation further.
© Oxford Business Group 2016