The African Development Bank has approved $800 million in loans to Morocco to support renewable energy programs, the bank said on its website on Thursday.
The loans will help Morocco develop a concentrated solar power (CSP) plant at the town of Ouarzazate, the Tunis-based bank said.
The project would be the first to be implemented under a programme which seeks to deploy about 1 gigawatt of generation capacity through plants and transmission infrastructure stretching across Morocco, Algeria, Tunisia, Egypt and Jordan, the bank added.
The African Development Bank (AfDB) statement said it has been “demonstrating its commitment to support the scaling up of renewable energy in Africa” and the approval of $800 million in loans will spur private investment in Morocco’s growing wind and solar markets.
“Morocco has emerged as an early leader in developing low carbon, sustainable energy on a large scale, and we are proud to support their drive. Lessons learned from these projects will inform efforts going forward in the country, region and around the world,” Hela Cheikhrouhou, Director of the AfDB’s Energy, Environment and Climate Change Department, said in the statement.
The African lender is extending technical and financial support to the North African nation to help develop a concentrated solar power (CSP) plant at Ouarzazate. It is also financing the Integrated Wind/Hydro and Rural Electrification Programme which would see the expansion of renewable energy capacity to 42% by 2020 and enabling Morocco to become a renewable energy industry leader.
Banking on the sun
The AfDB approved a loan of $212 million in May 2012 from its own resources and a concessionary loan for US $100 million from the Clean Technology Fund (CTF), to finance the first phase of the CSP plant at Ouarzazate. It aims to generate 120 to 160MW in its first phase and 500MW at full capacity, making it the largest CSP plant in the world.
The project is structured as a public private partnership (PPP) between the Moroccan Solar Energy Agency (MASEN) and a private partner. Estimated at a total cost of $1.31 billion, the project will be jointly financed by six other agencies including the World Bank, European Investment Bank, Agence Française de développement, German Development Bank (KfW), Neighbourhood Investment Facility (European Commission), as well as other Moroccan institutions.
Ouarzazate is the first project to be implemented under the ambitious CSP scale up program of the Middle East North Africa (MENA) region, which seeks to deploy about 1GW of generation capacity through a series of CSP plants. Its associated transmission infrastructure will stretch across Morocco, Algeria, Tunisia, Egypt and Jordan. Domestic energy access, economic growth and regional integration are the goals along with eventual exports to Europe.