The Climate Investment Fund (CIF) Trust Fund Committee has approved the revised plan for support Concentrated Solar Power in the MENA region included in the Clean Technology Fund backed by African Development Bank (AfDB) and World Bank (WB) among other international development funds.
The document, submitted by Algeria, Egypt, Jordan, Morocco, and Tunisia in collaboration with AfDB and WB, includes reallocation of funding among the participants.
Algeria has confirmed that it will not request CTF funding while the rest remains as follows:
The total amount allocated for the plan has been decreased by $90 million to current $660 million from the endorsed plan in November 2010. Furthermore, the Committee notes, “the approval of CTF funding by the Committee is dependent on the submission of high quality project or program proposals”.
The MENA CSP plan of the CTF was first endorsed by CTF Trust Fund Committee in December 2009. However, the program is somewhat delayed due to “(i) the Arab Spring and the uncertainties this has brought about for large infrastructure investments in some countries, (ii) subsidy requirements in excess of what is considered affordable by the participating countries, (iii) specific project-related delays, and (iv) possibly economic difficulties in Europe”, CTF says.
The first approved project under the MENA CSP plan was the Ouarzazate I 160 MW CSP plant. It’s considered a success by CTF due to a significant interest attracted from bidders and a 30% below estimates bid price at 19 cents per kWh. The rest of the projects are still facing delays.
The investment program has been updated to reflect the specific developments in the program countries, to build on the experience of the Ouarzazate project and to extend technology coverage to CPV.
“The changes suggested by the countries in the plan make it a more viable and flexible plan which takes into account the realities each of these countries face,” stated Mafalda Duarte, AfDB coordinator for the Bank’s CIF program. “We can all look to this revised plan as both a signal of hope for the forward economic and social movement in the region built on renewable energy, and a more realistic blueprint for the evolution of renewables as a potent engine of power globally.”
Updated Investment Program (IP)
Algeria has indicated that it does not intend to borrow from CTF, but would like to continue participating in the MENA CSP initiative.
Morocco remains the country most likely to deploy CSP at a sustained pace in the short to mid-term, and it has so far developed only 32% of the capacity in the pipeline in the original CSP CTF IP. With the second phase of the 500 MW Ouarzazate plant now launched, Morocco is in a unique position to achieve the goals of the CSP CTF IP
In Tunisia, all projects, except the STEG Akarit project, have been dropped from the CTF pipeline, mostly because they were unlikely to proceed fast enough to fit in the CTF time frame. The STEG project in Akarit, on the other hand has made good progress in terms of technical preparation, even if it is somewhat delayed.
As part of the Update, Tunisia has requested that a larger share of the envelope originally foreseen be re-allocated to the Akarit CSP project. Approximately US$62 million have been requested for this purpose (or US$1230/kW), with the possibility for an upward revision. Against this background it is proposed to keep the project in the pipeline but at a low likelihood rating.
In Egypt, the 100 MW Kom Ombo plant has faced delays due to siting issues and country specific challenges, with the political changes that resulted from the Arab Spring, but is now progressing satisfactorily. The full indicative amount for Egypt of $97 million has been allocated to Kom Ombo in the IP Update of November 2010. It is proposed to increase the CTF amount to $123 million (or $1230/kW as for all first phase projects). As for Tunisia, it is proposed to reassess the desirability to keep the project in the pipeline when the second stage of the IP Update is completed and to consider the possibility of an upward revision of the CTF amount at that time.
In Jordan, the Ma‘an 100 MW power plant will not go ahead as a single project. It has been replaced in the pipeline by five possible CSP projects for development by private sector sponsors for which MOUs have already been issued. In addition, the Ministry of Energy and Mineral Resources (MEMR) also received two proposals for Concentrated Photovoltaic (CPV) projects that are considered eligible for consideration for support under the MENA CSP CTF program
