HomeNewsThe great potential of North Africa's renewable energy sector

The great potential of North Africa’s renewable energy sector

1 June 2012 – The Ernst & Young renewable attractiveness index highlights North Africa’s renewable energy potential. That region has an abundance of solar resources together with some wind resources, and these are expected to attract a significant amount of investment once political stability is restored.

In terms of the various countries of the region, Algeria’s legislative framework for the renewable energy sector is praised as being one of the more progressive in the middle east and north Africa region. However, delays in implementation have stunted the growth of renewable energy’s proportion of the country’s energy supply. Algeria remains committed to its ambitious targets of 20% of energy supply from renewable energy sources by 2030. It has publicly stated that it will be investing US$120 billion into renewable energy projects. Wind energy potential is relatively low, yet several small-scale wind projects with capacities of 10 MW to 20 MW are planned to be constructed over the next three years, mostly near the northern coastline. It is solar where the greatest potential lies, as Algeria has an abundance of the resource.

Egypt remains a relatively new market for renewables with a significant amount of potential and ambitious targets. Egypt is seeking to derive 20% of its energy from renewable sources by 2020 mostly through wind (12%) and hydro and solar photovoltaics (PV) (8%). Several studies are being conducted concerning the connection of the Egyptian grid to the European grid. Electricity sector reform, a modern grid infrastructure, proposed feed in tariffs and a renewable energy fund would lay a significant foundation for further growth in the renewable energy sector.

Without any domestic coal or oil reserves and Morocco’s energy demand expected to double by 2020, this country is actively seeking alternatives to meet its current and future energy needs. A target to generate 42% of electricity from renewable energy sources by 2020 demonstrates the necessity and commitment to diversify its energy supply. Despite no feed in tariff or subsidies, the Moroccan government has privatised the energy sector, which has encouraged private and foreign investment in renewable energy. Further reforms are planned with the breakup of the former monopoly enjoyed by the state utility, Office National de l’Electricite (ONE). Being the only country connected to the European grid, Morocco has a great opportunity to transform itself from a net energy importer to a net energy exporter. Morocco’s excellent solar and significant wind resources support the case for the country to become an energy provider to Europe.

The Tunisian government has ambitious targets in the renewable energy sector, although there is currently no feed in tariff or renewable energy certificate incentive scheme in place. Tax incentives and subsidies are used to encourage development and construction. Investment and expansion are required to develop and increase the grid to meet solar and wind targets. Interconnections with Algeria, Libya and European countries will be required and are being planned. Various legislative, regulatory and financial barriers hinder the development of Tunisia’s attractive wind potential.