Morocco Energy Situation

Overview

Kingdom of Morocco
Capital	Rabat (34°02′N 6°51′W)
Official language(s)	Arabic
Government	Constitutional monarchy
King	Mohammed VI
Prime Minister	Abbas El Fassi
Total area	710,850 km2
Population	32,200,000 (2009 estimate)
GDP (nominal)	$104.031 billion
GDP Per capita (nominal)	$3,161
Currency	Moroccan dirham (MAD)
Time zone	WET (UTC+0)
Calling code	+212

 

Morocco is located in North Africa and has borders to Algeria and Western Sahara, with coasts towards the North Atlantic Ocean as well as the Mediterranean Sea (see map). In Morocco, a Mediterranean climate is prevalent and in the north-west, it becomes more Saharan-continental and thus extreme to the south-west and southern regions. The Atlas-Mountains run from the south-west to north-east and form the climatic border: in the north-western part, summers are dry and warm, the winters mild and rainy. East of the Atlas Mountains, the climate is continental, with hot summers and cold winters, with little rain. The wind is generally highest at the northern and south-western coast and on the eastern part of the Atlas-Mountains. The official language in Morocco is Arabic, but there are also Berber dialects spoken and French often is the language of business, government and diplomacy. Morocco is a constitutional monarchy with Mohammed VI as the king who appoints the prime minister. The current prime minister is Abbas al-Fassi, voted into office at legislative elections held in October 2007 which can be considered as relatively free, but with a very low voter participation (37 % of which 19 % proved invalid). Foreign policy is oriented towards the West. Morocco aims to mediate between Arabic, African and international partners and has close connections to other developing countries with similar intentions. A potential for conflict is the unresolved status of Western Sahara, which Morocco claims, but is under an UN-administered cease-fire status since 1991. As the Sahrawi Arab Democratic Republic (Western Sahara) has been accepted by the African Union, Morocco since then left the union. Morocco is a member of the WTO and has signed free trade agreements with the European Union, the United States and Turkey. In 2008, Morocco got the status of »statut avancé«, which gives access to more European programmes. In addition, it is part of a free trade zone with Egypt, Tunisia and Jordan. In 2009, the main export partners were Spain (22,02 %), France (20.22 %) and India (4.91 %), import partners were France (15.95 %), Spain (14.72 %) and China (7.1 %). Morocco is strongly involved in co-operations of North African as well as European countries bordering the Mediterranean Sea. Although the main trade partner is still the EU and Africa only accounted for 5.6 % of foreign trade transactions, its trade with other countries of the Arab Maghreb Union is steadily growing and doubled from 2004 to 2008 to around 1.4 billion €. Morocco has also signed the Agadir Agreement to establish a free trade zone between the Arabic Mediterranean nations with Tunisia, Egypt and Jordan, in effect since March 2007. Experts of the World Bank, other banks and investment companies see large potential for economic growth in Morocco and classify the country as a potential market of the future. In 2010, the inflation rate was 2.5 %. In 2007, 15 % of the´Moroccan population lived below the poverty line. The per capita income in Morocco is within the middle group of African countries.

Energy situation

Energy Supply

The primary energy supply in Morocco has been rising steadily and reached 14 977 ktoe in 2008 which translates to 627 PJ or 174 182 GWh. The share of the various sources of the total primary energy supply in 2008 can be seen in the table below. Morocco is clearly dependent on fossil fuels, as crude oil accounts for 39 % of the primary energy supply, coal and peat for 20 %, petroleum products for 32 % and gas for 3 %. The primary energy supply has increased significantly in the past. It developed quite linear from around 104 PJ in 1971 to the current value of 627 PJ (in 2008). According to historic data from IEA the main growth dependency is as high as 96 %.  

Total Primary Energy Supply 2008
Energy Source	in PJ	in %
Coal and Peat	123	20
Crude Oil	242	39
Oil Products	202	32
Gas	20	3
Hydro	3	0.5
Geothermal, Solar etc.	1	0.1
Combustible Renewables and Waste	20	3
Electricity	15	2.4
TOTAL	627

 Source: http://www.iea.org/stats/balancetable.asp?COUNTRY_CODE=MA

Electricity Supply

In 2008, the amount of electricity produced by the public utility ONE and the three independent power producers (JLEC, EET and Théolia) totalled 20 306 GWh (one third by ONE, two thirds under concession). Thermal power generation accounts for 92 % of the national electricity generation, hydropower accounted for 7 % of electricity supplies, and wind power for 1.5 %. Athough the installed capacity in Morocco has grown in the past, it could not meet the stronger growing electricity emand. This resulted in an increase of imports rom Algeria and Spain. The amount of electricity sold in Morocco reached 21 568 GWh in 2008, compared with 20 541 GWh in 2007, meaning 4.9 % growth.9

Energy Consumption

Final energy consumption in 2008 added up to 11 313 ktoe (equal to 131 570 GWh or 473 PJ).

Energy Demand

According to estimates by ONE, national demand for electricity in 2015 will be 35 000 - 40 000 GWh. MEMEE, however, expects an even higher demand, reaching 44 900 GWh (7 545 MW) in 2015 according to an intermediate scenario.

Electricity Consumption

The electricity consumption according to sectors shows that the largest consumer is the industry with 38 %. For the period up to 2015, the Government of Morocco is expecting the annual growth rate to be as high as 7.5 %, mainly due to socioeconomic development and a growth of population.

Electricity Consumption in 2008	in GWh	in %
Industry	8250	38
Transport	1085	5
Residential	7165	33
Commercial and Public Services	3908	18
Agriculture Forestry	1303	6
TOTAL	21711

 Source: http://www.iea.org/stats/electricitydata.asp?COUNTRY_CODE=MA

Electricity Grid 

In 2006, the transmission grid was owned by the state power utility ONE and consisted of 18 920 km of 400 kV, 225 kV, 150 kV and 60 kV lines. It covers the entire country and is connected to the Algerian and Spanish power grids via regional links. The capacity of the connection between Morocco and Spain is 1 400 MW via two 400 kV subsea cables, between Algeria and Morocco there is a 1 200 MW connection via three 400 kV lines. The distribution of the grid can be seen in figure 3. (for most of the country), seven local municipal authorities (»Régies«) (Marrakech, Fès, Meknes Tétouan Safi, El Jadida-Azemmour and Larache-Ksar El Kébir) and four private companies (»gestion déléguée«), using ONE’s grid Casablanca, Rabat-Salé Tanger Kénitra). The losses in the network accounted for 4.7 % in 2007.8 ONE aims at strengthening and extending their grid. They plan to extend the 400 kV, 225 kV and 60 kV lines and aim at constructing a third 400 kV subsea connection to Spain. Furthermore, a 400 kV connection to Algeria is currently implemented to enforce the existing 225 kV connection. According to ONE, the grid in the south is not sufficient for new (renewable) capacities, ONE aims at building 650 km of 400 kV lines between Agadir and Laâyoune; this 400 kV line to the South is supposed to be in operation by 2012.

Access rate

 In recent years, Morocco has made great progress in providing grid power to its population. In 1996, ONE launched a national electrification programme named Programme pour l’Electrification Rurale Global (PERG). The rate of rural electrification was only 18 % in 1995 before the programme started, but rose steadily to 96.5 % by the end of 2009. ONE does not indicate whether the electrification figure is calculated with respect to households or villages, but gives numbers of electrified households and villages: 35 670 villages, or 1 918 002 households, had been provided with an electricity supply by the end of 2009 through the scope of the PERG programme. Even villages situated long distances from the power grid now have a basic decentralised electricity supply, stemming from renewable energy sources. By the end of 2007, 44 719 households in 3 163 villages were equipped with PV kits.

Market situation for different energy technologies and services

Electricity prices in Morocco are, by regional standards, relatively high. The price of electricity for final consumers is fixed by decree from the Prime Minister of Morocco. Subsidies on electricity prices have been phased out in recent years, leading to a steady but moderate price increase. Rural customers have the possibility to participate in a prepaid system based on pre-paid meters. For electrical supply, the customer can purchase the desired amounts via rechargeable cards sold for 20 DH (1.8 €).

Solar Energy

At the end of 2007, 44 719 households were equipped with SHS. The aim of another governmental pilot programme, the Chourouk programme, is to install 1400 micro PV power stations of 0.5 – 1 kW in the regions of d’Errachidia, Benguerir and Ouarzazate. These PV stations will be connected to the low voltage grid. At the moment, the programme is stopped, until the new renewable energy law is approved.

Wind Energy

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Biomass

In Morocco, the major form of renewable energy is biomass, mostly in the traditional form of fuel, wood or charcoal for heating and cooking purposes.

Biogas

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Hydro Power

In 2008, 1 360 GWh were produced from hydro power, 298 GWh from wind. ONE operates 26 hydro power stations with a total installed capacity of 1 360 MW. In addition, hydro power comes partly from a 464 MW pumped storage power plant near Beni Mallal/Afourer. In Oued Oum Er Rbia, micro hydro power stations shall be developed in the future. For that purpose, a programme has been set up to identify potential sites of which 200 could be identified. Furthermore, pilot projects are to be operated and evaluated now or soon; the development, financing and construction of more stations will be pursued in the future.

Other renewable Sources

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Key problems of the energy sector

• Moroccos energy supply depends to 97,3% on imports (fossil fuels and electricity) and is thus depending on the rising and volatile price for oil, gas and coal.
• In 2008 the energy bill was about 71 billion Dirham (6.5 Mrd €), and subsidies for petroleum products of about 23 billion Dirham (2 Mrd€).
• Financial Problems of ONE to cover electricity production costs
• To face the energy requirements of Morocco the ONE has to install for the next 10 years 500 to 600 MW annually. This would request an investment of about 10 billion Dirham (1 Mrd €) per year.

Policy framework, laws and regulations

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General Energy policy, Energy strategy

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Specific strategies (Biomass, renewable energies, rural electrification, energy access strategy etc.)

Within the National Energy Strategy, separate targets
for renewable energies are given. The share of renewable
energies shall be increased to 10 % of primary energy
supply and to 18 % of power generation by 2012, which
is – due to the short time frame and a current share of
7 % in electricity production – a very ambitious target. By
2020 / 2030, the strategy considers it possible to exploit a
wind potential of about 7 000 MW, 1 080 MW of solar PV and 400 MW of concentrating solar power (CSP). It
is not clearly stated how Morocco intends to reach these
targets, but a new law on the electricity market as well
as one on renewable energies are under discussion. In addition,
some support programmes for renewable energies
exist or are in the planning stage.
The Ministry of Energy, Mining, Water and the Environment
has aggregated its efforts to promote renewable energies
in a document named »sector of energy and mining
– essential realisations 1999 to 2008, challenges and
perspectives«13 including an outlook until 2015. One
aim of this plan is that by 2015 wind farms with a total
capacity of 1 440 MW are supposed to be operational.
400 000 m2 of solar collectors are to be installed for producing
hot water and 400 MW of small hydro energy are
envisaged. In total, these actions are meant to save the
energy equivalent of about 500 000 toe (5.8 TWh). In
addition, it also includes efforts to promote the use of
energy efficient technologies in households, public buildings
and industry

Important Laws and regulations

The law regarding renewable energies (Projet de loi no 13-
09) passed the Council of Ministers in April 2009, but is
still a draft. It is expected to be approved by Parliament
in late 2009. The draft version states that, differing from
the current electricity law, there is no limitation for the
installed capacity of renewable energies. Producers have
the right of access to the (very) high and medium voltage
grid in order to transport the electricity from the site of
production to the site of consumption. This right, however,
is subject to the technical capacity of the respective
grid and has to be authorized by the grid operator. The
draft law does not introduce fixed tariffs but states that all
economic questions, as well as the technical conditions,
have to be negotiated on a case by case basis between the
grid operator and the power producer. In the draft law,
also the - until now missing - administrative procedures
are addressed and the competency and timeline for authorization
procedures are fixed. The permission for elec-tricity production from renewable sources is granted for
25 years; after this time, it can be either prolonged for another
25 years, or the production site becomes property
of the state. A challenge for wind projects is the fact that
projects with a generating capacity of more than 2 MW
will only be allowed in zones foreseen for wind projects.
These zones, however, have not been announced yet
which would mean that at the moment no bigger wind
projects would be eligible for authorization. As the law is
still a draft, this problem could be solved before the law
enters into force.
In June 2008, ONE introduced the EnergiPro-programme,
which supports the auto-production of renewable
energy. Entities with high electricity consumptions can construct wind farms up to 50 MW and connect
them to the HV/VHV-ONE grid for transmission to the
consumption site. Until 2011, the grid operator will impose
a wheeling charge of 0.5 euro cents/kWh (6 cDH/
kWh). After 2011, the charge will rise to 0.7 euro cents/
kWh (8 cDH/kWh). The surplus electricity can be sold
to ONE at a price of 50 % of the medium and weighted
ONE tariff of the consumer. ONE will guarantee the supply
indepently from the momentarily production.
For solar PV, ONE has another support programme, the
»Chourouk« programme. Within this programme,
1 215 micro PV stations will be installed by ONE on the
roofs of private households in the regions of d’Errachidia,
Benguerir et Ouarzazate. The households participating will get a financial incentive with their electricity bill, but
the exact incentive has not been published so far. In May
2009, it was announced that the Spanish solar company
Isofoton had won the offer to install the PV stations in
d’Errachidia and Benguerir. However, this programme is
currently on hold until further notice.

 

Institutional set up in the energy sector

ONE is a public law company answering to the Ministry
of Energy, Mining, Water and Environment (MEMEE)
and has been responsible for the generation and transmission
of electricity in Morocco since 1963. It operates
as a single buyer and owns the transmission and most
of the distribution grid. Since 1994, power plants with
capacities up to 10 MW can also be built and operated
by private enterprises, and above 50 MW on the condition
that the project was subject to open tendering and
all power produced is sold to ONE. This opening of the
electricity market is governed by law no. 2-94-503 dated
23 September 1994 and forms part of an attempt to offer
electricity to consumers at internationally competitive
prices. In a policy decision in 2001, it was determined
that this objective was to be achieved through the opening
of the Moroccan electricity market with respect to
electricity generation, distribution and sale in several
stages, but little effort has been made to realise this decision.
One measure in 2008 was to allow IPPs to operate
power plants of up to 50 MW installed capacity instead
of the previous threshold of 10 MW. However, IPPs still
have to rely on ONE’s cooperation as there is no regulating
authority established in Morocco. Currently it is always compulsory to deal with ONE in its role as a single
buyer and operator of the transmission network. Another
goal of the further opening of the electricity market is
to divide the Moroccan electricity market into two parts,
an open market segment and a regulated one. Customers
will be split into eligible and non-eligible customers,
depending on a threshold based on annual consumption.
This threshold has not yet been defined. Eligible clients
will be able to choose whether to purchase electricity
from the open or from the regulated market. Switching
will be possible according to rules not yet defined.
Those not belonging to the category of eligible customers
shall continue to purchase their electricity from the
regulated market at officially determined prices in order
to secure the supply of power to private households with
a low voltage connection at prices set by the state.

Governmental institutions Private sector (enterprises, NGOs)

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Activities of other donors, activities of NGOs

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Existing projects

• Biogas technology in Morocco (region of Souss-Massa)
  
• Feed-in tariffs (FIT) in Morocco
  

Publications

• Trieb, F. et al. (2006): Trans-Mediterranean Interconnection for Concentrating Solar Power, TRANS-CSP, Final Report, Stuttgart, 2006.
  

External links

• Kingdom of Morocco (official portal)
  
• Morocco entry at The World Factbook