Developing Solar Energy Industries in MENA

The Road from R & D to Commercialization – Better Productivity Better Jobs” June 19-21, 2013, Murray Edwards College, Cambridge England

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MENA’s Comparative Advantage: Significant Solar Resource in Proximity to a Large

Market for Solar Energy

Concentrated Solar Power (CSP) has large unexploited economies of scale

Proven technology, transferable to developing countries –for energy and manufacturing

CSP costs are still high…

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…but there is a high potential for cost reduction

CSP levelized costs are forecasted to be reduced 50% by 2035 (3% per year)

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OUARZAZATE I PROJECT (NOOR I) – AN INNOVATIVE FINANCING STRUCTURE FOR LOWEST COST AND OPTIMAL RISK ALLOCATION

SPC (Solar Power Company)

Equity (25%) Repackaged debt

Equity (75%)

PPP partners

MasenGrant

Shareholders(ONE, SIE, Hassan II Fund, State)

IFIsConcessional financing

Gvt of Moroc

co

Carbon Finance

ONE

MASEN

SPC

PPA1PPA2

(Δ) to be covered by GoM, or by export if

possible

State Support

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CSP technology is more transferable and closer to existing industrial

base in MENA

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Egypt – CSP components with potential for local manufacturing

1. Condenser & Heat exchangers•Existing stainless steel market•Manufacture under international standard•Adapt existing industries

2. Pumping Equipment• Manufacture under international standard• Motor and power electronics

3. Mirrors• Cost of energy and transport• Adapt existing float glass industry

4. Storage tanks• Manufacture under international standard• Adapt existing industries

5. Structure & Tracker•Combine with PV support structure

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MENA countries are aiming to be “center of excellence” instead of

low-cost and low-skilled centers for manufacturing

• In the past, the development of potential CSP industries in MENA was driven by the low cost of labor and energy, and the proximity of Europe, but this is changing.

• Pure subcontracting is now shifting toward more local R&D and production of high-tech components

• Morocco is taking decisive steps in this direction by creating: the Moroccan Agency for Solar Energy (MASEN), the Moroccan Institute for Solar Energy Research (IRESEN) and the Oujda “Clean Tech” park.

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Climate Innovation Center (CIC) in Morocco to assist business in manufacturing CSP components

• The CIC aims to strengthen capacity and attract financial resources to support private sector in the manufacturing of solar and other “clean” technologies. The CIC is at an early stage of preparation (business plan).

• The planned key CIC activities are:

1. Financing: Grants (up to 50k) and access to VC funds.

2. Information: Website on solar technologies, Annual forum “Morocco Cleantech” and e-bulletin on Cleantech market trends.

3. Advise/Training: Mentoring program for managers, Technical trainings for engineers.

4. Networking: “Diaspora” network, Partnership with Universities and Research Centers for knowledge transfer, Exchange program with regional and international organizations.

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Thank you!

Jonathan Walters

Director, Regional Programs & Partnerships

World Bank

jwalters@worldbank.org