Major Western lenders claim they will not finance Morocco’s series of planned solar projects in the disputed Western Sahara region, leaving the North African country’s 2020 renewables target looking vulnerable.
seen as a beacon of light in the otherwise disappointing North African
renewables market, with Saudi Arabia’s ACWA Power currently building a 160MW
parabolic-trough CSP plant in Ouarzazate, central Morocco.
4GW renewables target for the end of the decade hinges on five utility-scale
solar plants being in place – with current plans siting three of them within or
near Western Sahara.
sources at the European Investment Bank, the World Bank and German development
bank KfW have told Reuters that their institutions would not back
projects in Western Sahara, given ongoing ambivalence regarding Morocco’s
territorial claim to the region.
official plans call for a 500MW solar project at Foum El Eoued and a 100MW
plant near Boujdour – both within Western Sahara – and another 500MW project at
Sabkhat Tah, on the border.
support those investments, it would look like we are supporting the Moroccan
position” vis-à-vis Western Sahara, a “senior bank source” tells Reuters.
never supported any project in [Western Sahara], and we won’t,” a second
unnamed source is quoted by Reuters as saying.
political uncertainty surrounding Western Sahara has dragged on for decades,
but it is apparently the first time representatives from such critical lenders
have stated their unwillingness to finance renewables projects in the region.
options for Morocco may include re-siting the projects or looking for other
sources of funding, perhaps from Arab Gulf states.
ownership of the whole of Western Sahara, and effectively controls much of the
region, including the largest city, El Aaiún.
the indigenous Sahrawi people also claim ownership of Western Sahara under the
so-called the Sahrawi Arab Democratic Republic – a country which is formally
recognised by the African Union, and heavily backed by neighbouring Algeria.
like the World Bank, the EIB and KfW have been seen as central to the
development of large-scale renewables in North Africa, either through the
Desertec Industrial Initiative or other programmes. Last autumn Germany’s KfW
agreed to provide a €654m ($891m) loan to Morocco to partially finance the next
two plants in its pipeline, both at Ouarzazate.
due in late 2013 to have launched the tender for those plants, having already
published a shortlisted group of bidders, but no announcement has yet been
Sahara is among the most sparsely populated regions in the world, covering more
than half as much area as Morocco, but with less than one-sixtieth its