Moroccan CSP programme

Project profile



Our client

Moroccan Agency For Solar Energy (Masen), a government owned entity responsible for implementing the Moroccan Solar Plan, which aims to establish a minimum total capacity of 2000MW in solar power by 2020. 

Project location

Ouarzazate, Morocco

Project description

Five sites have been selected for the development of solar power plants as part of the Moroccan Solar Plan, with the 500MW phase one solar power complex at Ouarzazate the first to be developed.

Masen has the lead role in selecting developers for the plants at each of the five sites through a competitive tender process, in accordance with international procurement rules.

The first project under the Solar Plan was the 160 MW CSP NOORo I plant, which reached financial close in 2013 and is currently under construction. On January 23, 2013, Masen launched the Second CSP phase of the NOORo solar power complex in Ouarzazate, with an aggregate capacity of approximately 350MW.

This phase is divided into two separate projects: (i) NOORo II, a CSP parabolic trough project with a capacity of around 200MW, with storage of at least three hours, and (ii) NOORo III, a CSP tower project with a capacity of around 150MW, with storage of at least three hours. Applicants were invited to submit proposals for either one or both of the projects.

Seven applicants pre-qualified for the Request for Proposal (RFP) stage. Bidders were given the option of submitting separate bids for each project and/or a combined bid for both, with a level of integration aimed at producing a more competitive tariff for both projects.

The consortium led by International Company for Water and Power Projects (ACWA), with Sener Grupo de Ingeniería (SENER), was announced as the successful bidder for both projects on January 9, 2015, with a winning combined bid. The tariffs are among the lowest for thermal solar projects worldwide (around US$0.15 per kWh for NOORo II and US$0.16 per kWh for NOORo III).

Masen signed the project and finance contracts with the ACWA Consortium between March 10, 2015 and May 10, 2015 and achieved financial close for both the NOORo II and NOORo III projects on May 18, 2015. Construction will shortly begin on the two projects and the anticipated commercial operation date for both is 2017. A consortium of Sener and SEPCOIII will construct the plants. NOMAC Maroc, an affiliate of ACWA, has been appointed as operator.

The structure of the transaction is shown on the following simplified diagram:

Scope of work

Our international team advised Masen on all aspects of these projects, including:

  • drafting the RFP tender documentation and supporting Masen through the tender process
  • evaluating the bids and negotiating with the bidders
  • working closely with the wider team of advisers including EY, JLT and Lahmeyer
  • negotiating with international finance institutions on the financing provided to Masen
  • finalising the project and financing documents with the ACWA Consortium.

The work involved coordination between our London, Paris and Casablanca offices, with input from our Beijing and Bahrain offices. The multi-disciplinary team advised on the corporate, finance, security and construction documentation and provided Moroccan and English law advice.

The team led the tender process, as well as negotiations with the preferred bidder to reach financial close. The RFP was highly developed, in order to meet the ambitious timetable set out for the projects. Bidders were required to submit fully termed construction contracts and the full set of finance and PPA documents were included as part of the second stage of the RFP.

This level of preparation in the tender stage allowed financial close to occur within two months of signing the power purchase agreements for these large and complex CSP projects.

What makes the project unique

IFI funding

Masen has obtained financing for the projects from certain IFIs and is on-lending it, on a sole-lender basis, to each project company for the purposes of the financing of NOORo II and NOORo III. This exposes Masen to additional project risk and pass-through risk, which had to be managed in the financing arrangements at Project level.


The Kingdom of Morocco’s Solar Plan will be one of the world’s largest solar energy projects, with the aim of establishing 2,000MW of solar power by 2020. Five sites have been selected for the development of solar power plants, with the 500MW phase one solar power complex at Ouarzazate the first to be developed.

Masen’s many roles

Masen is not only the borrower under the IFI loans, but also the lender to the project companies, the offtaker under the PPA, a shareholder to the project company and a shareholder to the O&M Company. It also owns the site, and will act as service provider in respect of the shared site services to all the NOORo project companies. The many roles taken by the government procurer had to be managed adequately to ensure that the project companies were protected from conflict of interest.

The ambition of the project

The timetable for reaching financial close was highly ambitious, given the complexity of the funding structure and the technologies involved. There is significant political interest in the Ouarzazate CSP projects. Masen aims to be a world leader in this area and a point of reference to other governments looking to implement similar solar programmes.

Development of solar expertise in Morocco 

As part of the Solar Plan, Morocco should benefit in the long term from the knowledge and skills developed through the construction and operation of the NOOR Projects. Bidders were required to provide added value in this regard to assist Morocco in building capacity in the solar energy industry.

Key issues

  • Risk allocation under the project and finance documents. The basic position is that Masen takes all the risk it can, to ensure a competitive tariff. This has to be balanced against Masen’s multiple roles in the project and its nature as a public-funded entity.
  • Loan financing structure through the IFI’s and managing the requirements of multiple lenders in a back-to-back lending structure.
  • Masen’s involvement as lender, borrower, offtaker, site-owner, shareholder and O&M shareholder and managing this within the traditional project finance structure of MENA IPPs.
  • New technology risk. CSP and thermal storage are relatively new technologies and at this scale there is little in the way of operating projects to give lenders comfort that the performance expectation will be met. There is also a limited number of developers to choose from, with the required skill and experience. To provide sufficient comfort to the lender, sponsors were asked to provide a level of completion support to sufficiently de-risk the project in order to secure financing.