Masen’s NOOR solar energy projects – the achievements of Morocco’s Solar Plan
As the tender process for the NOOR PV I program reaches shortlisted bidder stage, we take a brief look at the significant achievements of Morocco’s Solar Plan.
The NOOR PV I program, comprising three separate photovoltaic (PV) projects at different locations in Morocco, is the third round of procurement in Morocco’s Solar Plan. The Solar Plan aims to install a minimum of 2000 MW of solar energy (both concentrated solar power (CSP) and PV) by 2020. It is being implemented by the Moroccan Agency for Solar Energy (Masen), through international tenders for independent power projects (IPPs), structured on a build, own, operate and transfer basis. Masen started work in 2010 and has lost no time in seeking to reach this target.
The first of the NOOR Ouarzazate CSP projects and the first stage of Morocco’s Solar Plan, NOORo I (150 MW parabolic trough project with 3 hours of energy storage), is expected to start exporting power early this year.
The second phase of the Solar Plan comprised two CSP projects procured concurrently:
- NOORo II (a 200 MW parabolic trough project with 7 hours of energy storage); and
- NOORo III (a 150 MW tower project with 7 hours of energy storage).
These reached financial close in May 2015 and are currently under construction. First power on both is expected in 2017.
The unique features of these projects and of the Solar Plan, underline why Morocco has been so successful in procuring competitively priced solar energy.
The NOORo CSP projects have achieved very competitive tariffs, in most part due to the project structure adopted by Masen. For these projects, Masen has taken on the role of lender, raising the debt financing itself, from a group of International Finance Institutions (IFIs), including AfDB, the Clean Technology Fund, EIB, IBRD, and KfW. The IFIs benefit from a guarantee granted by the Kingdom of Morocco. Masen acts as sole-lender to the project companies, packaging this debt and on-lending it on preferential terms. As a government-owned entity, Masen is able to achieve far better pricing than a special purpose project company. The cost of debt is therefore significantly lower than would otherwise be the case, and is estimated by Masen to result in a reduction of approximately 30% of the price per kWh
Masen is a multi-stakeholder in the NOOR projects. It is the procurer of the IPPs, the offtaker of the electricity, the senior lender and, through its subsidiary, Masen Capital, a 25% shareholder in each project company and in each O&M company. Masen also provides the site and associated infrastructure and services.
The reason for the many roles of Masen is not just to achieve best value for money for the Moroccan public, but also to ensure that Morocco benefits in the long term from the knowledge and skills developed through the construction and operation of the NOOR projects, protecting and advancing Moroccan interest in the projects and in the solar energy industry in general.
With 20 shortlisted bidders for NOOR PV I, three CSP projects with an aggregate capacity of over 400 MW under construction, and procurement for the next solar complex – NOOR Midelt – underway, Morocco, and Masen, can rightfully be considered a leading player in the solar energy business. The interesting question is whether other countries in the MENA region can replicate this success.