2014 FEMIP Evaluating Renewable Energy Manufacturing Potential in the Mediterranean Partner Countries Final report - May 2015 Evaluating Renewable Energy Manufacturing Potential in the Mediterranean Partner Countries Final report May 2015 Evaluating renewable energy manufacturing potential in the Mediterranean Partner Countries | EIB - IRENA 2 EY – Final report – January 2015 Evaluating renewable energy manufacturing potential in the Mediterranean Partner Countries EIB - IRENA Acknowledgment This report was commissioned and jointly financed by the European Investment Bank (EIB), under the Facility for Euro-Mediterranean Investment and Partnership (FEMIP) Trust Fund, and the International Renewable Energy Agency (IRENA). The FEMIP Trust Fund was established in 2004 and has been financed by 16 EU Member States and the European Commission. It is managed by the European Investment Bank and is intended to support the development of the private sector via the financing of studies and technical assistance measures and the provision of private equity. This report is part of the Technical Assistance Window of the FEMIP Trust Fund. IRENA is an intergovernmental organisation which promotes the widespread and increased adoption and the sustainable use of all forms of renewable energy, including bioenergy, geothermal, hydropower, ocean, solar and wind energy, in the pursuit of sustainable development, energy access, energy security and low-carbon economic growth and prosperity. IRENA and EIB wish to acknowledge the comments provided by the New Renewable Energy Authority (NREA) of Egypt; the Ministry of Energy, Mines, the Environment and Water of Morocco; and the National Agency for Energy Conservation Agency of Tunisia (ANME). IRENA and EIB also wish to thank the following organisations for their insights during the peer review process: the League of Arab States (LAS); the United Nations Economic and Social Development Commission in Western Asia (UN ESCWA); the Regional Centre for Renewable Energy and Energy Efficiency (RCREEE) For further information or to provide feedback, please contact: Mustapha Taoumi (IRENA) at [email protected], or Joyce Liyan (EIB) at [email protected]. Disclaimer The authors take full responsibility for the contents of this report. The opinions expressed do not necessarily reflect the view of the European Investment Bank and the International Renewable Energy Agency or their partners or Members, nor is it an endorsement of any project, product or service provider. The designations employed and the presentation of material herein do not imply the expression of any opinion on the part of EIB or IRENA concerning the legal status of any region, country, territory, city or area or of its authorities, or concerning the delimitation of frontiers or boundaries. 3 EY –Final Report – May 2015 Evaluating renewable energy manufacturing potential in the Mediterranean Partner Countries EIB - IRENA 4 EY –Final Report – May 2015 Evaluating renewable energy manufacturing potential in the Mediterranean Partner Countries EIB - IRENA Table of contents Acknowledgment 3 Table of contents 5 Table of figures 6 List of tables 7 List of abbreviations 8 Executive Summary 10 1. Introduction 15 Objectives of the study 16 Scope of the study 18 Overview of the RE market in MPCs 20 2. Methodology overview 23 Local value chain and industrial assets 24 Assessment of the perspectives for local RE manufacturing 34 3. Assessment of the local manufacturing potential in MPCs 38 Egypt – Country Report 39 Morocco – Country Report 62 Tunisia – Country Report 81 4. Achieving local manufacturing potential - Policy recommendations 101 Summary of recommendations addressed 122 5. Appendices 128 Appendix A: Annex to the country reports 129 Appendix B: Country interview lists 154 Appendix C: Methodological notes 159 Appendix D: Key stakeholders and initiatives in the RE sector in the region 161 Appendix E: Lessons learnt from international experience 163 5 EY –Final Report – May 2015 Evaluating renewable energy manufacturing potential in the Mediterranean Partner Countries EIB - IRENA Table of figures Figure 1: Wind energy potential in the MPC region (GENI, 2014) 19 Figure 2: Solar and wind installed capacity, pipeline and target in pilot countries 20 Figure 3: Overview of the general value chain for renewable energy projects (Enolcon, 2014) Error! Bookmark not defined. Figure 4: Typical segments of RE value chain (Based on IRENA, 2014) Error! Bookmark not defined. Figure 5: Solar PV value chain (Enolcon, 2014) Error! Bookmark not defined. Figure 6: Solar CSP value chain (Enolcon, 2014) Error! Bookmark not defined. Figure 7: Onshore wind value chain (Enolcon, 2014) Error! Bookmark not defined. Figure 8: Installed electric capacity (left) and production (right) in Egypt in 2012 (AHK Arab, 2014) 130 Figure 9: Typical daily electricity load in Egypt and future generation scenarios for Egypt (Trieb, 2005) 131 Figure 10: Renewable energy resources in Egypt: Wind speed (left, TUD), DNI (right, SolarGis) 132 Figure 11: Electricity production mix in Morocco, (IEA, 2012) 139 Figure 12: Evolution of energy consumption in Morocco – prospect 2000-2030 (HCP, 2007) 139 Figure 13: Energy balance evolution in Tunisia, (IEA, 2014) 146 Figure 14: Electricity production mix in Tunisia, (STEG 2012) 147 Figure 15: Electricity MW capacity mix in Tunisia (STEG 2013) 147 6 EY –Final Report – May 2015 Evaluating renewable energy manufacturing potential in the Mediterranean Partner Countries EIB - IRENA List of tables Table 1: Renewable energy targets in MENA countries (EY, 2014) 17 Table 2: Pilot countries assets (EY, 2014) 18 Table 3: Solar energy potential in the MPC region (GENI, 2014) 19 Table 4: References of literature on local manufacturing used in the course of the study (EY, 2015) Error! Bookmark not defined. Table 5: Egyptian companies involved in the Solar PV value chain (EY/Enolcon, 2014) 42 Table 6: Egyptian companies involved in the Solar CSP value chain (EY/Enolcon, 2014) 48 Table 7: Egyptian companies involved in the Wind value chain (EY/Enolcon, 2014) 56 Table 8: Moroccan companies involved in the Solar PV value chain (EY/Enolcon, 2014) 65 Table 9: Moroccan companies involved in the Solar CSP value chain (EY/Enolcon, 2014) 71 Table 10: Moroccan companies involved in the Wind value chain (EY/Enolcon, 2014) 77 Table 11: Tunisian companies involved in the Solar PV value chain (EY/Enolcon, 2014) 85 Table 12: Tunisian companies involved in the Solar CSP value chain (EY/Enolcon, 2014) 91 Table 13: Tunisian companies involved in the Wind value chain (EY/Enolcon, 2014) 97 Table 14: Key statistics in Egypt (World Bank/IFC, 2012) 129 Table 15: Key statistics in Morocco (World Bank/IFC, 2012) 138 Table 16: Key statistics in Tunisia (World Bank/IFC, 2012) 146 Table 17: Installed and forecasted RE capacity in Tunisia (RCREEE, 2012) 148 Table 18: Identified sites (GIZ/STEG-ER, 2013) 149 7 EY –Final Report – May 2015 Evaluating renewable energy manufacturing potential in the Mediterranean Partner Countries EIB - IRENA List of abbreviations ADEREE National Agency for Renewable Energy and Energy Efficiency AFD French Development Agency AfDB African Development Bank AMISOLE Association Marocaine de l'Industrie SOLaire et Eolienne ANME Association Nationale pour la Maîtrise de l'Energie (Tunisia) ATEE Association Technique Energie Environnement BFPME que de financement des petites et moyennes entreprises (Tunisia) BoP Balance of Plant BTK Banque Tuniso-Koweïtienne (Tunisia) CRTEn Research and Technology Center of Energy CSNER Chambre Syndicale Nationale des Energies Renouvelables CSP concentrated solar power CTF Clean Technology Fund DEWA Dubaï Electricity and Water Authority DIE German Development Institute DSO Distribution system operator ECEP Energy Conservation and Environmental Protection (Egypt) EE Energy efficiency EIB European Investment Bank EKF Export Credit Agency of Denmark EPC Engineering, Procurement and Construction EPGE EP Global Energy ESMAP Energy Sector Management Assistance Program EU European Union EUR Euro EY Ernst & Young FEDELEC Fédération des Electriciens et Electroniciens (Tunisia) Fénélec Fédération nationale de l'Electricité (Morocco) FIMME Fédération des industries métallurgiques, mécaniques et électromécaniques (Morocco) FiT Feed-in tariffs FMO Dutch Development Bank FTE Full Time Equivalent GENI Global Energy Network Institute GIZ Deutsche Gesellschaft für Internationale Zusammenarbeit - German Cooperation GW Gigawatt ICTSD International Centre for Trade and Sustainable Development IFC International Finance Corporation IFIs International Financial Institutions IPP Independent power producer IRENA International Renewable Energy Agency IRESEN Research Institute for Solar Energy and Renewable Energies kWh Kilowatt hour LCOE Levelized Cost of Energy LCR Local content requirements 8 EY –Final Report – May 2015 Evaluating renewable energy manufacturing potential in the Mediterranean Partner Countries EIB - IRENA MASEN Solar Moroccan Agency MEDENER Mediterranean Association of the National Agencies for Energy Conservation MENA Middle East and North Africa MESRS Ministry for Higher Education and Scientific Research (Tunisia) MPCs Mediterranean Partner Countries MSP Mediterranean Solar plan MW Megawatt MWp Megawatt peak NEPCO National Electric Power Company NREA New & Renewable Energy Authority (Egypt) NREA National Rural Education Association (Egypt) O&M Operation and Maintenance OECD Organisation for Economic Co-operation and Development OEM Original Equipment