morocco: energy and climate policy evaluation and recommendations

Country profile of MoroccoEvaluation of energy and climate policies compared to EU

By: Erika de Visser, Luis Janeiro, Yvonne de Bie, Niklas HöhneMay 2013

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Table of content

> Chapter 1 Introduction Slide 3

> Chapter 2 Methodology Slides 4-5

> Chapter 3 Results Slides 6 - 18

> Chapter 4 Conclusions Slides 19 - 28

> References Slides 29 - 30

> Annex 1 Overview of EU policies Slide 31 - 32

> Annex 2 Conclusions and recommendations per policy area

Slides 32 - 36

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Chapter 1: Introduction

Goal of the project:

> to evaluate climate and energy policies in countries outside of the EU and

to provide recommendations for policy opportunities for the

transition to a sustainable energy supply in the respective country.

Deliverables:

> to develop a methodology to evaluate energy and climate policies in

non EU countries.

> to apply the methodology to two non-European countries, namely

Morocco and Ukraine.

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Chapter 2: MethodologySegments

The analysis is categorized in key economic sectors (rows), and policy areas (columns), which together determine the individual segments (dotted lines) of the analysis:

General energy and climate strategy

Energy supply

Industry

Buildings

TransportEn

erg

y E

fficie

ncy

Ren

ew

ab

le e

nerg

y

Low

carb

on

stra

teg

ies

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Chapter 2: MethodologyBenchmark and scores

Benchmark:

> The (technical) mitigation potential is measured, which means the extent the

implemented policy packages in each country are able to exploit the technical

potential.

> For each segment is identified which policies apply. To measure the effectiveness of

policy packages, both indicators that have positive impact (incentives) and

negative impact (barriers) are defined, which together form a coherent and

consistent strategy to achieve a long-term low-carbon future.

Barriers

-4 -3 -2 -1 0

Incentives

0 1 2 3 4

Scores:

> For each segment a segment score for the incentives on

a scale of 0 to 4 is given as well for the barriers (-4 to 0)

with a 4 for incentives meaning ‘fully effective at

capturing mitigation potential in that segment’ and a -4

for barriers meaning ‘prevents policies from achieving

reductions for this segment’.

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Chapter 3: ResultsOverview of Policies

Energy Efficiency Renewables Low Carbon

ENER

GY

SUPP

LY

• There is no relevant policy instrument in

place to incentivise /support energy

efficiency in energy supply.

• Fuels for electricity production highly

subsidised.

I B • Ambitious targets for 2020

• Public investments and tendering

process. No fiscal incentives such as tax

or duty/exemptions on equipment.

• Low guarantee of regulatory stability.

I B

• No relevant policies in place

I

INDU

STRY

• There has been public funding for a

limited number of energy audits.

• Fuels for industrial use highly subsidised.

I B• Introduction of a net metering scheme is

under discussion.

• Fuels for industrial use highly subsidised.

I B


I

BUIL

DING

S

• Introduction of a building code is under

discussion

• Fiscal incentives for the purchase of

efficient light bulbs

• Fuels are highly subsidised.

I B • Programme 'Shemsi' for solar water

heaters.

• Introduction of a building code is under

discussion.

• Fuels are highly subsidised.

I B


TRAN

SPOR

T


• Fuels for transport are highly subsidised.

I B


• Fuels for transport are highly subsidised.

I B


I

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Chapter 3: ResultsGeneral energy and climate policy

EFFICIENCY/RENEWABLES/LOW-CARBON

AssessmentScore

Morocco

Score

EU

GENERAL CLIMATE

STRATEGY

• There is a renewable energy and energy efficiency target,

but not a GHG target.

• Targets are set for 2020 and 2030, but not for 2050.

However, the National Energy Strategy does not provide a

comprehensive framework to achieve the targets.

• There is more attention for renewables than for energy

efficiency, while energy use is expected to rise with 6-8%

yearly.

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Chapter 3: ResultsEnergy efficiency in electricity and heat supply

ENERGY EFFICIENCY

AssessmentScore

Morocco

Score

EU

ELECTRICITY AND

HEAT SUPPLY

Incen

tives

• There are a few incentives to improve the energy

efficiency of fossil fuel power plants. One is a fund from

FED (Fonds de Développement Energétique) covering the

rehabilitation of assets of ONE (Office National de

l’Electricité).

• In 2009 ONE has submitted a grant proposal to the

African development bank asking for more than US$ 120

million to finance a major work-over of the national

energy distribution network. The work-over is expected to

reduce transmission losses from 4,7% to 3.5%.

Barri

ers

• Fuel oil for electricity production is highly subsidized.

Price is in the order of 2600 DH/tonne while prices of fuel

for industrial uses - which are already subsidized - are at

4666 DH/tonne.

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Chapter 3: ResultsRenewable energy in electricity and heat supply

RENEWABLE ENERGY

AssessmentScore

Morocco

Score

EU

ELECTRICITY

AND HEAT

SUPPLY

Incentiv

es

• By 2020, Morocco aims to produce 20% of all electricity from renewable energy

sources. To achieve this objective, the country seeks to have a total installed

renewable energy capacity of 6 GW (or 42% of the total installed capacity).

• The 20%-/42%-target by 2020 is ambitious, particularly considering the current

share of renewables, which predominantly consists of long existing hydropower

plants.

• SIE (Societé d'Investissement Energétique) was created in 2009 with a fund to

support renewables.

• The main policy instrument is public tendering of large-scale wind and solar

power projects. No fiscal incentives such as tax or duty/exemptions on equipment

exist.

Barriers

• Overall attractiveness for domestic and foreign renewable energy investors is

low, especially due to the absence of an effective regulatory support scheme.

• Grid connection agreement has to be negotiated with ONE on a project basis,

creating big uncertainty about the connection costs.

• Another important technical barrier to renewable energy deployment in Morocco

is the grid infrastructure. While in the northern part of the country the

construction of wind power plants has triggered a technical adaption of the grid,

the southern part is still not prepared for the integration of fluctuating renewable

energy power.

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Chapter 3: resultsLow carbon technologies in electricity and heat supply

LOW CARBON

AssessmentScore

Morocco

Score

EU

ELECTRICITY AND

HEAT SUPPLY

Incen

tives

• No policy instruments to support fuel switch to low-carbon

fuels in place.

• No policy instruments to support CCS in place.

• Nuclear power is discussed as a long-term option.

Barri

ersN.A N.A. N.A.

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Chapter 3: ResultsEnergy efficiency in industry

ENERGY EFFICIENCY

AssessmentScore

Morocco

Score

EU

INDUSTRY

Ince

ntiv

es

• Morocco is currently elaborating a National Program of Energy Efficiency in

Industry, with the aim of developing the institutional and regulatory framework,

provide support for energy audits and investments and training of professionals.

• The program’s objectives (2014-2020) are:

• Energy savings: 600.000 TOE in 2014, 1.950.245 TOE-eq in 2020

• Carbon emission avoidance: 2 MtCO2-eq (2014), 7.5 MtCO2-eq (2020)

• Companies to be audited: 360 (2014), 1855 (2020)

• Some energy audits have been carried out with the financial support of the African

Development Bank. The electric and thermal energy consumption characterization

in 3 industrial zones (Casablanca, Agadir and Tanger) is in process.

• Despite these developments no policy instrument providing sufficient incentive for

energy efficiency investments in industry (e.g. support schemes, voluntary

agreements, emissions trading, energy and/or CO2 taxes) is in place.

Barr

iers

• Fuel oil for industrial use is subsidized. Even after the latest price raise in June

2012, the government subsidy is in the range of 2000 DH/tonne. Regulated price is

4666 DH/tonne.

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Chapter 3: ResultsRenewable energy in industry

RENEWABLE ENERGY

AssessmentScore

Morocco

Score

EU

INDUSTRY

Ince

ntive

s

• The option for RE auto production is given under the

Renewable Energy Development Law 13.09 of 2009.

• No specific policy instruments to incentivize an increase of

RES in industry have been found.

• Introduction of a net metering scheme is under discussion.

Barri

ers

• Fuel oil for industrial use is highly subsidised. Even after the

latest price raise in June 2012, the government subsidy is in

the range of 2000 DH/tonne. Regulated price is 4666

DH/tonne.

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Chapter 3: ResultsLow carbon technologies in industry

LOW CARBON

AssessmentScore

Morocco

Score

EU

INDUSTRY

Incen

tives• There are no policy instruments to support CCS.

Barri

ersN.A. N.A N.A

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Chapter 3: ResultsEnergy efficiency in buildings

ENERGY EFFICIENCY

AssessmentScore

Morocco

Score

EU

BUILDINGS

Incent

ives

• Morocco is currently in the process of implementing a new

building code.

• There are some fiscal incentives in place e.g. for compact

fluorescent lamps (WEC, 2008)

Barrie

rs

• Fuels are subsidized e.g. the real market price of a 12 liter

cooking gas bottles — a widespread product — is more than DH

100 (US$14) while the standard retail price is DH 40 (US$5.6)

(Worldbank, 2012)

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Chapter 3: ResultsRenewable energy in buildings

RENEWABLE ENERGY

AssessmentScore

Morocco

Score

EU

BUILDINGS

Incen

tives

• Programe Shemsi for solar water heaters. Depending on

customer types, the program is available under the form

of a financial assistance through the support of studies

and experts funds, loans and regulatory requirements.

(Aderee, 2012)

Barri

ers

• Fuels are subsidized e.g. the real market price of a 12 liter

cooking gas bottles — a widespread product — is more

than DH 100 (US$14) while the standard retail price is DH

40 (US$5.6) (Worldbank, 2012)

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Chapter 3: ResultsEnergy efficiency in transport

ENERGY EFFICIENCY

AssessmentScore

Morocco

Score

EU

TRANSPORT

Ince

ntiv

es

• No policy instrument incentivising energy efficiency in the

transport sector in place.

• The reduction of the energy intensity of transport and the

conversion of transport modes to less carbon-intensive

fuels in Casablanca was cited in the Moroccan submission

to the Clean Technology Development Programme as a

possible application of funds under the programme.

Barri

ers

• Transportation fuels are subsidised. Even after the latest

price raise in June 2012, the government subsidises 3.35

DH/litre of gasoil. Regulated price is 8.15 DH/liter.

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Chapter 3: ResultsRenewable energy in transport

RENEWABLE ENERGY

AssessmentScore

Morocco

Score

EU

TRANSPORT

Incen

tives

• No specific policy incentivising renewables in the

transport sector in place.

Barri

ers

• Transportation fuels are subsidised. Even after the latest

price raise in June 2012, the government subsidises 3.35

DH/litre of gasoil. Regulated price is 8.15 DH/litre.

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Chapter 3: ResultsLow carbon technologies in transport

LOW CARBON

AssessmentScore

Morocco

Score

EU

TRANSPORT

Incen

tives

• No specific policy incentivising low-carbon technologies in

the transport sector in place.

Barri

ersN.A. N.A. N.A.

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Chapter 4: ConclusionsElectricity and heat supply

Sector assessment ‘electricity and heat supply’

> No policy instruments in place to incentivise efficiency of energy supply.

> Despite having set very ambitious renewables targets, Morocco is still lacking a comprehensive renewable energy strategy, which would address support for renewable energy in the long-term. Apart from public tendering for large-scale wind and solar power projects, there is no effective support scheme that would provide a strong incentive for investments in small-scale projects.

> Grid connection agreement has to be negotiated with ONE on a project basis, creating big uncertainty about the connection costs.

> Fuel oil for electricity production is highly subsidised. Price is in the order of 2600 DH/tonne while fuel for industrial uses - which is already subsidised - prices at 4666 DH/tonne.

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Chapter 4: ConclusionsElectricity and heat supply

Policy Recommendations ‘electricity and heat supply’

> Progressive and socially compatible phase-out of fossil fuel subsidies

> Implementation of policy incentives for the adoption of energy efficiency measures e.g. energy or carbon taxes, market mechanisms such as emissions trade or white certificates and/or standards.

> Implementation of a long term framework for the support of renewables.

> Providing a clearer regulatory framework for the connection of renewables to the grid.

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Chapter 4: ConclusionsIndustry

Sector assessment ‘industry’

> No policy instrument providing sufficient incentive for energy efficiency

investments in industry (e.g. support schemes, voluntary agreements,

white certificates, emissions trading, energy and/or CO2 taxes) is in place.

> There are, however, some developments in this area:

– Elaboration of the National Program of Energy Efficiency in Industry, with the aim

of developing the institutional and regulatory framework, provide support for

energy audits and investments and training of professionals.

– Some energy audits have been carried out with the financial support of the

African Development Bank and the characterization of industrial energy

consumption in Casablanca, Agadir and Tanger is in process.

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> Apart from discussions on the implementation of a net metering

scheme, there is no specific policy instrument to incentivize the

uptake of renewable energies in the industrial sector is in place.

> Fuel oil for industrial use is highly subsidised. Even after the latest

price raise in June 2012, the government subsidy is in the range of

2000 DH/tonne. Regulated price is 4666 DH/tonne.

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Policy recommendations ‘industry’


> Implementation of policy incentives for the adoption of energy efficiency measures e.g. energy or carbon taxes, market mechanisms such as emissions trade or white certificates and/or standards.

> Implementation of a net metering scheme to incentivise investments in on-site renewable energy.

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Chapter 4: ConclusionsBuildings

Sector assessment ‘buildings’

> In 2009 Morocco launched a programme to develop an energy efficiency code for the built environment. This code, which is still to be approved, will target hospitals, hotels, national education and residential buildings.

> Programme 'Shemsi' was established to spread the use of solar water heaters. The programme aims at increasing the installed surface to 1.7 million m2 by 2020. Depending on customer types, the program is available under the form of a financial assistance through the support of studies and experts funds, loans or regulatory requirements. Source: ADEREE www.aderee.ma

> Fuels are still highly subsidised e.g. the real market price of a 12 liter cooking gas bottles—a widespread product —is more than DH 100 (US$14) while the standard retail price is DH 40 (US$5.6) (Worldbank, 2012)

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Chapter 4: ConclusionsBuildings

Policy recommendations ‘buildings’

> Progressive and socially compatible phase-out of fossil fuel subsidies.

> Implementation of the building code.

> Adoption of minimum efficiency standards for household appliances.

> Implementation of a net metering scheme to incentivise investments in on-site renewable energy.

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Chapter 4: ConclusionsSector Conclusions – Transport

Sector assessment ‘transport’

> No policies to incentivise energy efficiency, renewable energies or low carbon technologies in the transport sector are in place.

> Transportation fuels are subsidised. Even after the latest price raise in June 2012, the government subsidises 3.35 DH/litre of gasoil. Regulated price is 8.15 DH/litre.

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Chapter 4: ConclusionsTransport

Policy recommendations ‘transport’

> Progressive and socially compatible phase-out of fossil fuel subsidies.

> Adoption of minimum emission standards for cars and trucks.

> Adoption of minimum biofuels blending requirements for road transport fuels.

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Chapter 5: Overall conclusions

> Morocco has great potential for:

– Renewable energy (solar and wind)

– Energy efficiency (expected energy use growth ~6% per year)

> Ambitious first steps made, establishing national renewable and energy efficiency targets

> Detailed policies to implement the targets are largely lacking

> Major barriers are fuel subsidies in all sectors

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References

• Ecofys, 2011. EU Climate Policy Tracker. Published in November 2011 by WWF.

• Ministère de l'Aménagement du Territoìre, du l'Urbanisme, de l'Habitat et de

l'Environnement, 2010. Seconde Communication Nationale a la Convention Cadre

des Nations Unies sur les changements climatiques. Available from: http://

unfccc.int/resource/docs/natc/mornc2f.pdf

• World Energy Council, 2008. Energy Efficiency Policies around the World: Review

and Evaluation. ISBN: 0 946121 30 3

• Royaume du Maroc. Ministère de l’Energie, des Mines, de l’Eau et de

l’Environnement, 2010. La nouvelle Stratégie Energétique Nationale. September

2010.


l’Environnement,2010. Loi 13-09 relative aux énergies renouvelables. June 2010

• Regional Center for Renewable Energy and Energy Efficiency (RCREEE), 2010.

Provision of Technical Support/Services for an Economical, Technological and

Environmental Impact Assessment of National Regulations and Incentives for

Renewable Energy and Energy Efficiency. Country Report Morocco (DRAFT). January

2010.

http://unfccc.int/resource/docs/natc/mornc2f.pdf



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References

• Regional Center for Renewable Energy and Energy Efficiency (RCREEE), 2010.

Provision of Technical Support/Services for an Economical, Technological and

Environmental Impact Assessment of National Regulations and Incentives for

Renewable Energy and Energy Efficiency. Policies for Energy Efficiency and

Renewable Energy in the RCREEE Group of Countries. April 2010

• Worldbank, 2012. The real cost of fossil fuel subsidies. Available from http://

go.worldbank.org/EBQRS9K7H0


l’Environnement, 2011. Stratégie Energétique: Bilan d’Etape. May 2011.

http://go.worldbank.org/EBQRS9K7H0



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Annexes

> Annex I: Assessment of EU policies

> Annex II: Conclusions and recommendations per policy area

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Annex I – Overview of EU Policies

Energy Efficiency Renewables Low carbon

General Climate Strategy

Energy supply

Energy Efficiency Directive (2012/27/EU) Effort Sharing Decision (2009/406/EC) European Emissions Trading System

(ETS) (2009/29/EC) Energy Taxation Directive (2003/96/EC)

Renewable Energy Directive (2009/28/EC)

Internal electricity market Directive (2009/72/EC)

Security of electricity supply and infrastructure investment Directive (2005/89/EC)

Effort Sharing Decision (2009/406/EC)

Carbon Capture and Storage (CCS) Directive (2011/92/EU)

Industry

Eco-design Directive (2009/125/EC) Energy Labelling Directive (2010/30/EU) Energy Efficiency Directive (2012/27/EU) European Emissions Trading System

(ETS) (2009/29/EC)• Energy Taxation Directive (2003/96/EC)

• Renewable Energy Directive (2009/28/EC)

Carbon Capture and Storage (CCS) Directive (2009/31/EC)

Industrial Emissions Directive (IED) (2010/75/EU)

Landfill Directive (1999/31/EC)

Buildings

• Energy Performance of Buildings Directive (EPBD) (2010/31/EU)

• Energy Efficiency Directive (2012/27/EU)• Eco-design Directive (2009/125/EC) • Energy Labeling Directive (2010/30/EU)• Energy Taxation Directive (2003/96/EC)


Transport

• Regulation on Energy Efficiency for passenger cars (443/2009)

• European Emissions Trading System (ETS) (2009/29/EC)

• Energy Taxation Directive (2003/96/EC)


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Annex IIPolicy Area Conclusions – Energy Efficiency

ENERGY EFFICIENCY

POLICY ARE

A CONCLUSIONS

Area

Assessmen

t

• Morocco has set targets for energy efficiency of 12% reduction in energy use by 2020 and 15%

reduction by 2030. These percentages are related to the expected energy demand at those dates in

the absence of the energy efficiency initiatives. The priorities for the short-term are contained

within the Plan Nationale des Actions Prioritaires (PNAP) (RCREEE, 2010)

• The National Agency for the Development of Renewable Energies and Energy Efficiency was

established in 2010

• Apart from public funding for a limited number of energy audits, there is no policy instrument in

place to promote the adoption of efficiency measures in industry.

• The building code is yet to be approved.

• No relevant policies to promote energy efficiency in the transport sector.

• The adoption of energy efficiency measures is disincentivised by highly subsidised fossil fuels in all

sectors.

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Annex IIRecommendations Policy Area Energy Efficiency


> Implementation of policy instruments e.g. energy or carbon taxes, market mechanisms such as emissions trade or white certificates to incentivise efficiency in the energy supply and industrial sectors.

> Implementation of the building code.

> Adoption of minimum efficiency standards for household appliances.

> Adoption of minimum emission standards for cars and trucks.

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Annex IIPolicy Area Conclusions – Renewable Energy

RENEWABLE ENERGY

POLICY ARE

A CONCLUSIONS

Area

Assessment

• The National Energy Strategy of Morocco and the related National Priority Action Plan (PNAP), both launched in

2008, set a target to meet 10–12% of the country’s primary energy demand by 2020 and 15–20% by 2030 with

renewable energy sources.

• By 2020, Morocco aims to produce 20 % of all electricity from renewable energy sources. To achieve this objective,

the country seeks to have a total installed renewable energy capacity of 6 GW (or 42 % of the total installed

capacity). The 20 % / 42 %-target by 2020 is ambitious, particularly considering the current share of renewables,

which predominantly consists of long existing hydropower plants.

• The National Agency for the Development of Renewable Energies and Energy Efficiency was established in 2010.

• Despite these developments, Morocco is still lacking a comprehensive renewable energy strategy, which would

address support for renewable energy in the long-term. Apart from public tendering for large-scale wind and solar

power projects, there is no effective support scheme that would provide a strong incentive for investments in small-

scale projects . No specific policy instruments to incentivise an increase of renewable energy in industry have been

found.

• Fossil fuels are highly subsidised in all sectors. This creates a strong disincentive for the adoption of renewables.

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Annex IIRecommendations Policy Area Renewable Energy


> Implementation of a long term framework for the economic support of renewables.

> Providing a clearer regulatory framework for the connection of renewables to the grid.

> Implementation of a net metering scheme to incentivise investments in on-site renewable power in industry as well as residential and commercial buildings.

> Adoption of minimum biofuels blending requirements for road transport fuels.