Noor Midelt I
10th July 2019
New record in Morocco with 800 MW hybrid CSP-PV plant, providing dispatchable solar power at an average tariff of USD 6 cents/kWh
The Moroccan Agency for Sustainable Energy (MASEN) has announced on May 21st the award of the contract for the construction and operation of the Noor Midelt I solar project to a consortium led by EDF Renewables and including Masdar and Green of Africa, a Moroccan independent power producer. The Noor Midelt I solar project is a hybrid CSP-PV plant with installed capacity of 800 MW and a minimum of five hours of thermal storage. This plant, technical design of which is being finalized, will sell electricity to MASEN under a 25-year Power Purchase Agreement (PPA), and is an important milestone towards achieving Morocco’s target to generate 52% of its electricity from renewable energy sources by 2030.
Why is this announcement a game changer for solar energy?
The implications of this announcement for utilities and grid operators in the Middle-East and North Africa (MENA) region are significant; with an average tariff of 0.60 Moroccan dirhams (MAD; about 0.06 USD) per kWh, Noor Midelt I will provide clean, domestic, dispatchable solar electricity at a price which is comparable or even sometimes lower than fossil-fuel based dispatchable power. For example, in Tunisia, where electricity is mainly produced from gas, the cost of electricity production was on average close to 0.08 USD per kWh in 2017. Hybridization of PV and CSP offers a great opportunity for countries with strong solar resources to develop 24-hour solar supply at a competitive cost, boosting energy security and contributing to the achievement of their renewable and climate ambitions.
This landmark result is mainly due to the sharp decrease in the cost of PV and CSP technologies observed in the market over the last years, the good level of solar resources at the site location, and to the hybridization of both solar technologies in order to combine the competitive advantages of each technology (low generation cost for PV and large-scale storage for CSP). A drop of CSP costs is also confirmed in IRENA’s latest report on “Renewable Power Generation Costs in 2018” which shows that the global weighted average LCOE for CSP fell by 26% in 2018 compared to 2017.
The record low tariff achieved is also due to access to concessional
financing, which remains essential in the short to medium term to accelerate
the deployment of dispatchable renewable power production in the region.
According to MASEN, the project will receive financing from many international
finance institutions, including the World Bank, the Clean Technology Fund
(CTF), KfW, the European Investment Bank (EIB), the Agence Française de
Développement (AFD), the European Commission and the African Development Bank (ADB).
World Bank support to the development of energy storage technologies
Energy storage is a central aspect in Noor Midelt I and will play a crucial role in the shift towards non-fossil energy that is underway in many countries. Storage—alongside greater electricity trade with neighboring grids, demand-side resources and other means of enhancing grid flexibility—is key to integrating variable renewable sources into grids at the scale necessary to mitigate climate change. The World Bank with 29 organizations established a new international partnership to help expand the deployment of energy storage and bring new technologies to developing countries’ power. The Energy Storage Partnership (ESP) aims to help develop energy storage solutions tailored to the needs of developing countries. The use of wind and solar power enhanced with storage can help decarbonize power systems, expand energy access, improve grid reliability, and increase energy systems’ resilience.
To enable the rapid uptake of variable renewable energy in developing countries, the World Bank Group is convening the ESP that will foster international cooperation on:
- Technology Research Development & Demonstration, Applications
- System Integration and Planning Tools
- Policies, Regulations and Procurement
- Enabling Systems for Management and Sustainability
By connecting stakeholders and sharing international experiences in deploying energy storage solutions, the ESP will help bring new technological and regulatory solutions to developing countries, as well as help develop new business models that leverage the full range of services that storage can provide. The ESP will take a holistic, technology-neutral approach by including all forms of energy storage, including batteries. The ESP will help expand the global market for energy storage, leading to technology improvements and accelerating cost reductions over time.
The ESP will be hosted at the World Bank’s Energy Sector Management Assistance Program (ESMAP) and will be developed and implemented in partnership with other organizations. The ESP will complement the World Bank Group’s $1 billion battery storage investment program announced in September 2018 to significantly scale up support to battery storage projects and raise an additional $1 billion in concessional finance.