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Sustainable Energy in MENA: Opportunities and Challenges
Tareq Emtairah IIIEE, Lund University Finsolar, 18.2.2016
Regional Overview
•Renewable Energy Installed Capacity
12 GW
•Solar PV installed Capacity
<100 MW
•Countries with specific RE targets
18
•Countries with RE laws6
•Cumulative RE targets for 2030
75 GW
•Arabic Speaking countries in MENA
19
•Estimated population in 2014
360 million
•Estimated nominal GDP in 2012
$2.8 trillion
•Total Electricity Installed Capacity
213 GW
•Annual Growth Rate in Electricity Demand
6%
Energy Dependence
2011 2000
Dependence
Independence
All Arab
MauritaniaDjiboutiJordanLebanonMoroccoTunisiaEgyptSyriaYemenLibyaBahrainUAESaudi ArabiaAlgeriaIraqQatarSudanKuwaitOman
-11 -10 -9 -8 -7 -6 -5 -4 -3 -2 -1 0 1
Current Energy Trends
Source: OAPEC (2005, 2007, 2012); EIA (2013); World Bank (2013)
134%
148%
186%
80%
100%
120%
140%
160%
180%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
GDP
Primary energy demand
Electricity generation
Energy Subsidies
Renewable Energy Installed Capacity, 2014
Non-Renewable94.78%
0,15%0,79%
4,25%
0.02%
Renewable5.22%
Solar
Wind
Hydro
Other
EE potential in MENA countries by sector
9
142 Mtoe 223 Mtoe 297 Mtoe
0%
20%
40%
60%
80%
100%
2012 2020 2025
Services
Households
Transport
Industry
Electricity
Agriculture
Progress Towards Sustainable Energy
Development
EnergyEfficiency
RenewableEnergy
Reports available: www.rcreee.org
Energy Subsidy Reforms 2014
Renewable Energy Targets
0 1000 2000 3000 4000 5000 6000 7000 8000 9000
Egypt
Syria
Morocco
Tunisia
UAE
Algeria
Jordan
Qatar
Sudan
Libya
Yemen
Palestine
Lebanon
Kuwait
Bahrain
Iraq
Total RE targets
Current Installed Capacity
RE Projects underConstruction
by 2020
by 2030
by 2020
by 2030
by 2020
by 2020
by 2020
by 2030
by 2031
by 2020
by 2025
by 2020
by 2020
by 2030
Policy Framework: Renewable Energy
1. IPP Public Competitive Bidding:Wind Target: 1,000 MWWind Tendered: 1,000 MWSolar Target: 1,000 MW Solar Tendered: 510 MW
2. Law 13-09: Third-Party Supply
IPP Public Competitive Bidding
1. Feed-in Tariffs 2. IPP Public Competitive Bidding:
Wind target: 2,500 MW Tendered: 250 MW
Feed-in Tariffs
Direct Proposal Submission: Round 1: 13 PPAs concluded at $0.17 per kWh for 210MW aggregate PV capacity
Round 2: 34 proposal received (50MW each), totaling 1700 MW. Only 4 proposals will be selected (200 MW)Net Metering Scheme
Net-metering combined with grant and bank loan15 MW of PV installed
Net-metering combined with high electricity tariffs
AFEX Renewable Energy 2015 Results
PV Investment Opportunities in the MENA
Utility-Scale power plants
On-grid Residential and
Commercial Rooftop
RE Self-Consumption in
Productive Sectors (On-grid
and off-grid)
Off-grid Rural and Peri-Urban Electrification
Solar PV Pumping
Utility-scale RE Markets
Utility-Scale Markets to Watch
• The NOOR Moroccan solar plan has set a target of a minimum of 2 GW of new capacity by 2020 which is expected to generate investments worth more than $9 billion.
• The first Noor I came into operation end of 2015, is a 160 MW parabolic trough CSP plant with three hours of storage.
• The tariff for the Noor I plant was set in 2012 at around $190/MWh,
• Noor II plant, this price has been driven down to around $140/MWh.
Noor I: Morocco's first CSP plant forges path to tech-led cost cuts
Egypt has set a target of 20% of electricity from renewable sources by 2020 and aims to build up to 2 GW of utility-scale solar projects, 2 GW of wind, and 300 MW of roof top.
The EBRD expects to finance several utility-scale plants and mobilize up to $1.5 billion in debt and equity from other financiers for these ventures. The total project cost is expected to be in the region of $4 billion.
Source: CSP Today Quarterly Update, December 2015
Egypt
• The Masdar Institute Solar Platform is working with technology firms to drive up temperature capabilities, improve efficiencies and reduce the cost of CSP plants.
• Research on sand as high temperature storage medium for CSP
http://social.csptoday.com/technology/uae%E2%80%99s-misp-center-accelerates-pre-commercial-tech-development
Technology Support
Distributed Generation Markets
Sour
ce: M
usta
kbba
lCle
an T
ech
On-grid Residential and Commercial Rooftop
In 2015, the Dubai government has called for all rooftops to be equipped with solar PV by 2030.
RE Self Consumption in Industrial and Commercial Sectors (On-Grid and Off-Grid)
Net-metering and high retail electricity prices• PV installation for self-
consumption already at grid parity
Sour
ce: A
zuri
Solu
tions
Off-grid Rural and Peri-Urban Electrification
Rural Electrification Project• Install 1.1 million individual
solar rooftops in rural areas between 2012 -2031
Sour
ce: L
oren
tz S
olar
Pum
ps
Solar PV Pumping
Solar irrigation program• 400 million dirham (€35 million)• 50% capex subsidy up to 75 000 Dirham
(€6 670) per project• 3 000 PV systems per year• Cumulative capacity of 15 MWp
Policy Framework: Energy Efficiency
7 countries have mandatory EE Building Regulations 8 countries have voluntary EE Building Regulations 1 country has a mandatory Green Building Rating
System
30
• 12 out of 17 countries have national energy efficiency action plans in place
• Jordan, Qatar, Saudi Arabia, UAE adopted minimum energy performance standards for air conditioners
• Qatar and UAE banned import and sale of incandescent light bulbs
Challenges to Scale Up of Investment
• Driving up cost of capital Political Uncertainties
• Undermining consumer confidence Quality Assurance Infrastructure
• Leading to administrative barriers Institutional Capacities
• That meet the three A’s (Appropriate, accessible, affordable)
Few financing options
• To assess markets and create business models
Weak local capacity
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