Library Briefing Library of the European Parliament 08/05/2013 Solar energy development in Morocco SUMMARY The Middle East and North In this briefing: Africa (MENA) region has experienced a steep Issue definition increase in energy demand in the past decade, prompted by economic and population Overview of Morocco's energy sector growth, and improved living standards . Morocco's commitment to RES However, the trend is not sustainable in the long term, in particular for net energy- Solar energy in Morocco importing countries such as Morocco. In order EU-Morocco cooperation in solar RE to ensure the security of energy supply and an energy mix less dependent on hydrocarbons Solar energy, local SMEs and industry they have focused on renewable energy Main references sources (RES) – solar, wind, hydropower, biomass, etc. Glossary Morocco is a pioneer among MENA countries Primary energy: Energy in the form in which it in establishing a policy and regulatory is first accounted for in a statistical energy framework for promoting RES and energy balance, before any transformation to secondary efficiency. Morocco benefits from great solar or tertiary forms of energy. and wind energy potential, as well as from a Installed capacity: The maximum capacity at key geographical location. Two major RES which a system is designed to run. initiatives – the Moroccan wind and solar projects – have been launched in order to Issue definition reach the national target of increasing the share of RES in the energy mix to 42% by 2020. As the largest energy importer in the MENA, EU-Morocco cooperation on RES (solar energy, Morocco has tried to diversify its energy mix in particular) would bring benefits to both and ensure its energy security through sides, as well as challenges. Initiatives already increasing the share of RES in this mix. Major exist, with the Mediterranean Solar Plan as the RES projects (wind and solar energy) were most significant. started as a means to reach the RES targets. EU-Morocco cooperation in the RES field – in Solar energy technologies can also contribute solar energy, in particular – provides both to local job creation and development of small partners with advantages and constitutes a and medium-sized enterprises (SMEs). potentially unifying project for the Euro- Med area. Solar energy projects also have an impact on local SMEs and industry. Overview of Morocco's energy sector Regional energy trends According to a recent OECD study, the MENA region witnessed a rapid increase in © arsdigital / Fotolia energy and electricity demand. Primary energy consumption has risen on average by 5.2% a year since 2002, while demand for electricity registered an average increase of 6.16% a year from 1998 to 2010. Among the Author: Carmen-Cristina Cîrlig 130515REV1 Contact: [email protected] Page 1 of 7 Library Briefing Solar energy development in Morocco determining factors are: rapid economic Morocco consumed 17 262 kToe of energy growth, energy-intensive industries, popu- in 2011, with petroleum products lation growth, as well as higher living accounting for 61.9%. Coal is second standards and urbanisation. The situation is (22.5%), followed by electricity trade3 (7.2%), a particular burden for MENA countries that natural gas (4.6%) and RES, namely are net importers of hydrocarbons (e.g. hydropower (3.0%) and wind power (1.0%). Morocco, Jordan). Fig. 1. Evolution of energy consumption Another study deems these conditions Ktoe= 1000 Toe 20 000 Petroleum Coal unsustainable in the long run, although the 18 000 Electricity trade Natural Gas 16 000 entire MENA region accounts for 50% of the Hydropower Wind power 14 000 world's crude oil and 40% of its gas. Some 12 000 10 000 scenarios predict energy and electricity 8 000 6 000 demand in MENA will double and triple, 4 000 respectively, between 2009 and 2030. 2 000 0 Already, the volatility of global energy 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 commodity prices, with a heavy impact on Source: Ministry for Energy, Mines, Water and Environment, 2011 finances, and energy poverty (i.e. lack of Traditional biomass (wood, plant waste) is access to modern energy services) are used extensively, in rural areas, but is not harming socio-economic development in included in the national energy balance. the region, particularly in rural areas.1 Most One of its negative impacts is deforestation. MENA countries are also very energy intensive (requiring high levels of energy to Fig. 2. Distribution of energy consumption, 2011 produce one unit of economic output). Hydropower Wind power 3.0% 1.0% Natural Gas The energy sector in Morocco 4.6% Electricity Morocco is the largest energy importer in trade 6.9% North Africa, with a high dependence rate on these imports (95.6% in 2011). Energy Coal 22.5% Petroleum consumption has risen at an average annual 61.9% rate of 5.7% from 2002 to 2011. However, per capita energy consumption, at 0.52 Source: Ministry for Energy, Mines, Water and Environment tonnes oil equivalent (Toe) in 2011, is less Electricity than one third the world average (1.7 Toe). Electricity demand has also been growing, Morocco's focus on energy-intensive sectors at an average of 7% in the past decade, (chemicals, construction, etc.), on building according to the Moroccan state-owned infrastructure, on tourism and industry will electricity utility (Office National increase its long-term energy needs. 2 d'Electricité, ONE). In 2011, electricity Statistics from the Moroccan Ministry for consumption was 28.8 TWh, 8.4% more than Energy, Mines, Water and Environment the previous year. Morocco generates its (MEMWE) offer an overview of the energy electricity mainly from coal and oil power sector in Morocco. plants and marginally from natural gas. One natural gas combined-cycle power plant Primary energy (Ain Beni Mathar) runs using the fee in kind Morocco's gross energy bill for 2011 was Morocco receives from the Maghreb-Europe 85.9 billion dirhams (MAD), approximately gas pipeline that links Algeria to Spain €7.7 billion. Of this, 75.9 billion MAD (€6.8 through Morocco. Electricity imports billion) was spent on crude oil and accounted for some 16% of consumption in petroleum products. 2011. Author: Carmen-Cristina Cîrlig 130515REV1 Contact: [email protected] Page 2 of 7 Library Briefing Solar energy development in Morocco A rural electrification programme (PERG) put Morocco's commitment to RES in place in 1996 increased the rural According to the International Renewable electrification rate from 18% in 1995 to Energy Agency (IRENA), Morocco has a key 97.4% at the end of 2011. geographical position and the potential to Fig 3. Rural electrification rate 1995-2011 be a regional hub with network intercon- nections with Spain and Algeria.4 100% 97.4% Renewable energy potential in Morocco is 80% immense. Solar radiance registers an 2 60% 62% average of 2 300 KWh/m /year, while great 40% potential for wind power exists in particular in the north and south, according to 20% 18% measurements conducted by the National 0% Agency for the Development of Renewable 1995 1997 1999 2001 2003 2005 2007 2009 2011 Energy and Energy Efficiency (ADEREE). Source: Ministry for Energy, Mines, Water and Environment, 2011 Policy and regulatory framework Energy price subsidy in Morocco Morocco has one of the most ambitious RES MENA countries account for almost half of programmes in the region. The country global energy subsidies. Total energy recently deregulated its electricity sector subsidies in Morocco amount to approxi- and facilitated the development of RES. mately 5% of GDP and almost 20% of state revenue. As there are many arguments National Energy Strategy against energy subsidies, including that they The National Energy Strategy adopted in may divert investment from energy-efficient 2008 sets out the fundamental objectives measures or RES, Morocco is considering and the strategic directions for the energy reforming its subsidy system. A possibility is sector. The strategy identifies RES and to replace the universal consumption energy efficiency as priorities and sets the subsidy with cash allowances for targets to be achieved by 2020: 42% of total households most in need. installed capacity for electricity production from R ES; 12% of energ y saving; and 1.7 Morocco's commitment to RES million m2 of solar water heaters (SWH). Specific targets are also set for each RES: The case for RES in MENA solar, wind and hydropower should each MENA countries have the highest solar reach 14% of ele ctricity pr oduction by 2020. energy potential in the world, and good wind energy potential. The International Fig. 4. Targets of the National Energy Strategy in % 2009 2015 2020 Energy Agency (IEA) estimates that solar Coal 29% 35% 27% power could generate 100 times the Oil 27% 19% 10% combined electricity consumption of Europe Gas 11% 8% 21% and MENA. By including RES in their energy Hydropower 29% 21% 14% Solar 0% 5% 14% mix, MENA countries could benefit from Wind power 4% 12% 14% more reliable energy supplies. Also, RES Source: Ministry for Energy, Mines, Water and Environment could be a solution for rural communities Legal provisions for national targets not connected to the electricity grid. Morocco's adaptation of its legislative However, in MENA, RES accounted for only framework to achieve the national targets 4% of electricity generation in 2009. Without on RES and energy efficiency appears to hydropower, this figure drops to 1%. Some have been fundamentally implemented: MENA