Elaboration of integration plans and market development and analysis and better knowledge of institutional aspects for PV in Egypt, Tunisia and Morocco
The integration plan and institutional aspects for PV have been developed by the partners on the basis of the results of the Task dealing with site selection for PV electrification villages. The results have also been used as inputs for the task on financing. The methodology adopted for the elaboration of integration plans included the presentation and analysis of realisations of national PV rural electrification programmes, analysis of new action programmes at medium and long terms (2005-2010), the description of the MED2010 integration programme for PV and its complementarity with the national programme of PV integration at medium and long terms, and the analysis of the institutional organisation of the project and role of various actors.
The MED2010 Conference took place on September 20th, 2002, in Marrakech. The objective of this Conference was to present the results of the MED2010 project, co-financed by the DG Research of the European Commission, and discuss the conditions for the development of the market for wind energy and photovoltaic in the Mediterranean area on a large-scale. The main conclusions of the Conference underlined the following issues: - Several objectives have already been achieved, which was not obvious for an external observer. Corollary: many agencies (governmental, multilateral or NGO) are very active, sometimes giving the impression of a certain disorder. - Confirmation of the important role of the implementation of appropriate and attractive regulatory and institutional frameworks to support the development of these markets in the region, in particular through a public-private partnership. - The very different logic between photovoltaic (decentralised) and wind power (directly comparable with other IPP - independent power producers -, with the aim of supplying to the grid), calls for different solutions, specific to each type of energy source. - The mandatory need for grants, mentioned by many speakers (partly due to a lack of knowledge about more adapted mechanisms) is not a panacea, nor a fate. It is rather advisable to think in terms of incentives (see above, efforts in cash) or of the possibility of giving guarantees to financing set up for the two types of renewable sources (extra-budgetary guarantee). Subsidies tend to backfire against the recipients themselves, and even more against those who finance them. They know that and are wary of it. - The issuing of licenses is the only exportable product (commodity) of a domestic project for renewables, and therefore an important financial leverage. It is thus important to know their price (characteristic of a commodity: price known and published for all), and to control their market (so as not to profit a minority, example: the polluters only) at the international level (several national initiatives are seeing the light, which does not yet bring solutions for developing countries). It is a development axis, and a matter of the power of financial market, therefore of countries, which is the key for the development of renewables in the future.
Prospects for green electricity trade and analysis of potential role of CDM and green certificates in the Mediterranean region
In order for green electricity trading in the Euro-Mediterranean region to be feasible, two main issues have to be addressed: Interconnection issues: and incentives frameworks for the green electricity trading in the euro-Mediterranean region. The MED2010 indicates that there is an important potential for green electricity trading in the Mediterranean region. Two instruments analysed in this research could help removing the barriers to the RE market in the SEMCs while serving the sustainable development of the region in a whole: Clean Development Mechanism (CDM) and tradable renewable energy certificates. Another research project (CDMED) concluded that the implementation of the CDM in the Mediterranean region and a could lead to more than doubling the RE market in the region by 2030. We have also underlined in our report that tradable renewable energy certificate systems could be an adapted instrument to promote green electricity in the region. However, it just started in some European Union and we still don't have enough experience to measure the real efficiency of such systems (the practice could be different from the theory) as a tool to promote RE technology penetration and development. Moreover, linkages between domestic markets and interaction between GHG emission, TRECs and CDM could be investigated further.
For PV, because of its low rural electrification rate and high population, the Moroccan PV market is the biggest among the three countries studied in MED2010 (Morocco, Tunisia and Egypt). Indeed, the PV market potential in Morocco amounts 100,000 to 200,000 PV systems. The market potential is estimated to 6000 to 15,000 PV systems in Tunisia and to 4,500 in Egypt. The detailed studies concerned the whole market potential in Egypt, 50% of the Tunisian market and 5 to 10% of the Moroccan market.
Assessment of wind resources and mapping of sites for wind power plants in Turkey, Egypt, Tunisia and Morocco
Concerning wind power, the economic potential of wind power has been estimated in Morocco (6000MW), Tunisia (1000MW), Egypt (10,000MW, technical potential 100,000MW) and Turkey (10,000MW, technical potential 88,000MW). Selected sites have also been analysed by Wasp and concerned wind farm potential projects totalling in Morocco (200MW), Tunisia (150MW), Egypt (130MW) and Turkey (70MW).
Elaboration of economic studies, business plans, analysis of investment need and adapted financing schemes for PV programmes
The work has been undertaken in three phases: data collection, development of an Excel tool adapted to PV projects and drawing up of Business-Plans. After the critical review of the results of the Iresmed project, the partners' focus has been to confirm that the business-Plans content was compared with the information required by the EIB for a finance request. The objective was to introduce a clear summary that will support the partner’s information required by the financial institutions. Following the EIB finance request guidelines, the projects should be evaluated and a business-Plan issue for the selected projects. The promoters support of this process was addressed and considerations where made to evaluate the local authorities support needed (mainly focus on to the PV investments). The financial simulations on case studies corresponding to the selected pilot regions, have been run with an example from each participant Mediterranean country.
Elaboration of economic studies, business plans, analysis of investment need and adapted financing schemes for wind power projects
Each partner has at least gone through one deep wind farm project economic analysis. They have all added a "Business plan report" in which a complete study of a single project has been carried out. A first stage includes a rigorous assumption and main data collection. It is important to underline that, even though some unknown parameters have been estimated, the sensitivity and risk analysis has helped understand the limitations of the project and the marginal cost that needs to be somehow subsidized. The profitability is measured in all cases according to three standard ratios: IRR, NPV and Payback, applied to the project itself and to the shareholder. A sensitivity analysis has been added to all of them. Small variations of certain sensitive parameters can lead to big changes in profitability results. In addition, it helps the developer to understand their strong and weak points.
Better knowledge of the role of developers, banks and support from governments for wind power and PV markets development
The work performed in this sub-task concerned the study of the available financing sources, providing updated information about the sources available, requirements and contact institutions. It has considered if the financing schemes are Supranational, multilateral or bilateral, with a detailed review of the EU Financial Institutions, EU cooperation programs from Energy and Transport Department, EU Research and Development (R&D), and the bilateral relationships from the EU countries supporting Mediterranean countries. It was among other highlighted the task of the European Investment Bank implementing the financial components of agreements concluded under the European development aid and cooperation policies. The EIB appraisal procedure has been the standard apply for the business plan development process for the project. The financing support available from the developers and the private banks study, has target: Commercial support to: Export credits, Buyers credits, Multy credits, Short-term buyers credits, Mix- credit FAD. Commercial Banking: Concession, Franchising, Micro-credit, Forfeiting, Structural financing. The support required from local authorities has been address, and several considerations where introduce, in order to have updated information about the committed objectives from each country. Finally an Action Plan has been established.
This activity has been carried out for the purpose of checking, albeit from a very general viewpoint, the technical feasibility of connecting substantial amounts of wind generating capacity to the electrical systems of the four South and East Mediterranean countries in hand, on the basis of the foreseen configuration of these systems in the year 2010. The core of the analysis carried out by CESI on the electrical systems of Morocco, Tunisia, Egypt and Turkey has been a load-flow study based on the use of computer programs belonging to the SPIRA software tool. The load-flow program runs were based on the grid configurations foreseen by each of the above countries for the year 2010. For the sake of consistency, these 2010 grid configurations were taken out of the data bank acquired by CESI within the framework of the MEDRING Project. The results indicate that a penetration of wind equalling up to 12% of total electric energy demand in the power production of the studied countries should not raise any major troubles in the grid and is technically feasible, provided that large wind farms are suitably positioned not only in the best windy areas, but also taking into account the layout of the high voltage grid. This power could be produced for domestic purpose (energy saving, environment protection) and/or for export (from Morocco to Spain for example).
Elaboration of integration plans and market development and analysis and better knowledge of the institutional aspects for wind power in Turkey, Egypt, Tunisia and Morocco
For the Integration Plan, the southern Mediterranean partners have surveyed in each country the wind power plants under operation or planned. The partners have also analysed the existing plans for the integration of wind power in their country at horizon 2005-2010; different scenarios have been elaborated depending on the share of electricity production which could be achieved by wind power. Regarding social and environmental benefits which, in order to value each country�s hopes towards the CDM market with neighbour EU, are much important, a few data has been collected to show some main features. The amount of households that would get energy supply from wind power by 2010, if objectives were reached, is extremely hopeful and encouraging: over 2,000,000 in Turkey, over a million in Morocco, 660,000 in Egypt and over 250,000 in Tunisia. An added value should be taken into account: specially in desert regions in Egypt, Morocco and Tunisia, the land would benefit not only from energy supply but also from the dropping of electric lines that can lead to future industrial development. Remarkable as well is the amount of jobs to be created whilst development of the project, during construction and during exploitation.