Draft hypotheses & connecting points to Tunisia and Morocco SE4JOBS team meeting Rabat, 24 March 2015 Johara Bellali, Karolin Blattmann, adelphi

Presentation: Good practices from 3 countries (FFU) Agenda Introduction Presentation: Good practices from 3 countries (FFU) Presentation: Tunisia and Morocco (adelphi) Barriers and opportunities for RE/EE market development and connections to good practices Discussion: Connecting the good practices (adelphi) Presentation and discussion: Toolbox (FFU)

International good practices Energypedia Toolbox SE4JOBS Process of implementation for joint FFU-adelphi activities International good practices Energypedia Toolbox  Regional integration  Stakeholder dialogues  Strengthening capacities  Pilot projects planning

Tunisia overview Power generation heavily dependent on imported gas Subsidised prices, first subsidy lifts in 2014 STEG as quasi monopolist for generation, transmission, distribution New targets for RE (Plan Solaire Tunisien) in 2030: 1,700 MW wind; 1500 MW PV; 500 MW CSP Renewable Energy Law blocked STWH: 700,000 m² (of targeted 1 million m² by 2016) installed (2013) EE: established, supporting agency ANME, decrease of energy intensity RE capacity equals 6% of total capacity or 3% of annual production PV: mostly small-scale, 10 MW project co-financed by KfW RE Jobs: 3390 (1,445 direct, 975 indirect) ; EE Jobs: 930

Tunisia overview 2 Framework conditions Dependency on limited number of foreign markets and sectors Good state of infrastructure (transportation, energy) but limited to interior regions High level of education but also high unemployment among youth, limited engagement of private sector in vocational training Policy Established industrial policy with current focus on innovation, FDI, export Regional development (e.g. Pôles de Compétivité) Private sector Industrial sector: Developed industry  (manufacturing, service sector) but fragmented (regional, ownership, export/local market) RE Manufacturing: services and partly equipment (STWH, EE); research, cluster (Borj Cedria)

Barriers and Opportunities for RE development Framework conditions Risk averse banks Potential lack of adequately skilled labour and training programmes Policy electricity market concentrated, private investments blocked Stakeholder dialogue evolving but potential for inclusion of civil society including the private sector Blockage of Renewable Energy Law Administrative procedures are not transparent, not standardized Private sector Lack of information and capacities with regard to business models Low level of organisation of RE companies Opportunities Well developed infrastructure RE resources High level of education, existing RE university programmes Support for FDI experience with EE (policy, institution, instruments), Existing self-consumption/net-metering scheme Successful PROSOL programme (STWH), PROSOLelec developing under current market conditions Industrial/regional development policy Existing RE / EE industrial sector including manufacturing and services Industry and technology hubs Initiatives to promote connection among industry players

Tunisia - Questions Framework conditions How can needed private investment (PST) be stimulated? Which roles do banks and FDI play? Capacity building with banks? How can research, industry and education be better linked? Policy Liberalisation of energy market? Independent regulator? how can processes for projects be standardized? How can clear regulations for investors be established? What is needed to guarantee grid-access to private investors? Policy alignment: industrial/energy policy and RE/EE private sector development and regional development What can be learned from the PROSOL design and implementation? How can the energy debate be further developed to promote renewable energy law? Further stakeholder dialogues? How can an ordinance be established? Private sector Business case development; pilot cases funded by gvt/donors? Capacity building with regard to market development (PV, STWH…) Can value chains be completed in collaboration with international players? Which part of the value chain or which types of companies should be supported?

MOROCCO

Morocco - Overview Framework conditions Large-scale investments for wind and solar No grid connection for LV & MV, no net metering nor feed in tariff Dependency on limited number of foreign markets High level of education but also high unemployment among youth High energy dependency Policy Strong legal framework, clear short term targets, robust instit. Programme National des Actions Prioritiares: the energy sector National Energy Strategy: Solar Plan, Integrated Wind Prog Energy subsidies Private sector Enabling climate for investment is improving Efficiency of the job market is ranked 121/155 ONEE, public concessions and some private (Regies) Established competitors is very low, open market? Federations of private sector, only a few SME do expand

2020 – 2000 MW Solar - 2000 MW Wind – 2000 MW Hydraulic Morrocco – overview Targets for Renewable Energy: 2020 – 2000 MW Solar - 2000 MW Wind – 2000 MW Hydraulic 2020 – 42% of installed capacity and 27% of electrical production 2020 – estimated job creation: 35120 Targets for Energy Efficiency: 2020 – 12% reduction of energy consumption and – 15% for 2030 2020 – estimated job creation: 17000

Morocco current status Wind: 800 MW installed, 1,000 MW in process CSP: 160 MW under construction, two tendered, 4th under prep

Morocco - Barriers BARRIERS Loi 13 -09 Grid connection Framework conditions Loi 13 -09 Grid connection Coherence in implmt‘ion Policy No net-metering No feed in tariff Concessions mgt Private sector Tendering processes RE/EE subsidies mgt

Morocco – Questions Framework conditions How can dialogues and coherence between different sectors be promoted? How can trade-offs and co-benefits be made visible to the decision maker? Policy Should a support system based on RE/EE subsidies be supported? Or should a market competitiveness approach be preferred? Should IPP be a model to follow? Decentralised generation? Private sector How can more financial analyses for RE&EE reach banks and potential investors? Would auto-production stimulate the market?

THANK YOU