Public and private sector finance lined up -- Morocco heads for 1.5 GW by 2012

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Morocco's wind industry had a quiet year in 2008 as it geared up to double the country's capacity in 2009, mindful of scoring a 20% green electricity target by 2012 with an anticipated 1440 MW of wind power to be built with a mix of private sector and public investment. Last year the national wind capacity total increased by just 10 MW to reach 134 MW (table).

On the public side, Gamesa is building a 140 MW facility near Tangier for the state utility, the National Office of Electricity (ONE). The first of 165 Gamesa 850 kW turbines are already turning, with the rest being rolled out during the year. ONE is providing an equity stake, while the rest of the funding comes from the Spanish government, the European Investment Bank and Germany's overseas aid bank, KfW.

Further large projects are on the way under the government's "Initiative 1000" program, aimed at installing 1 GW of wind power by 2012. A project for 200-300 MW at Tarfaya on the Atlantic coast is the most advanced, with several companies and consortia entering the second round of an international call to tender for development and construction of the plant. The deadline has been extended from October to this month to allow more time for bidders to collect wind data. One of the bidders, cash-strapped French developer and producer Theolia, has withdrawn from the process, while Nareva Holding, a subsidiary of the Moroccan industrial, financial and services conglomerate ONA, has joined in. It entered the bidding in partnership with Britain's International Power. Tarfaya is to be undertaken as a build operate transfer enterprise with a 20-year power purchase agreement with ONE. Completion is scheduled for 2011.

The new capacity in 2008 was a private sector 10 MW project built for Lafarge Maroc, a cement producer. The project extends Lafarge's 10.2 MW plant already powering its Tetouan cement works, taking advantage of the EnergiPro initiative, in which major industrial consumers investing in renewables to offset their energy bills and carbon emissions are eligible for various incentives. ONE will transport the power generated by these plant to the point of consumption and cover some of this cost. It also guarantees to buy any electricity surplus to the investors' needs at a favourable rate. Projects must be no larger than 50 MW. Gamesa delivered the turbines and is supplying a further six 2 MW turbines for another extension to be commissioned by the summer. Another cement company, Ciments de Maroc, 53.2% owned by Italy's Italcementi Group, is also developing a 50 MW project under the EnergiPro initiative at its factory near Laayoune in the south of Morocco.

Lafarge is one of seven industrial users that have signed memorandums of understanding with Nareva to develop a combined total of 310 MW under EnergiPro (Windpower Monthly, September 2008). At 100 MW, Lafarge's is the biggest project and one of the most advanced, alongside 60 MW for Sonasid, Morocco's leading steel producer, and 50 MW for railway operator ONCF. All being well, these three wind farms should be commissioned in 2010 or 2011, with the rest following by the end of 2012.

New law and money

On the policy front, the long-awaited -- and much revised -- renewable energy law creeps closer to completion. The expectation is that it will receive ministerial approval this year even if it does not quite make it to the statute book. Various measures put forward include establishing a free market for large, industrial consumers and appointing a regulator to fix purchase prices and supervise the market. Morocco recently signed a financing agreement with the European Union for EUR 76.6 million to support reform of the energy sector and the gradual integration of the Moroccan and EU markets. It has also secured two major credit lines for improving the transmission and distribution networks -- EUR 50 million over 17 years from French development agency AFD and $150 million from the World Bank, repayable over 25 years.

Also late last year, Morocco's state-run pension fund, the Caisse de Dépôt et de Gestion (CDG), set up a carbon trading fund with a capital of MAD 300 million (EUR 27.6 million) to promote and participate in projects complying with the Kyoto Protocol. The fund will buy carbon credits from clean-energy producers, among others, and trade them on the international market. CDG holds 50% of the fund, with the European Investment Bank and the Caisse des Dépôts et Consignations, a French state-owned financial institution which invests in projects of public interest, holding 25% each.

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