🚁 Heli view: Look who challenges South Africa in renewables

Morocco is ranked as the world’s most attractive renewable energy market for investment.

• In 2022, renewables accounted for 38% of Moroccan power generation.

• It aims to increase the share in its energy mix to 52% by 2030.

• In South Africa, a bigger economy, renewables account for less than 10%.

Size matters: In actual numbers, South Africa still easily outranks the North African upstart. 

• Morocco is fourth among African renewables producers, after Egypt and Ethiopia. 

• Though it may overtake them if projections turn out to be right over the next decade.

Healthy competition: The gap between Morocco and South Africa will remain steady.

• Moroccan aspirations to outproduce South Africa are far-fetched for now.

What matters: The salient question though is not around future rankings but how Morocco got to this point.  

• What can other African nations learn from afar as many ramp up renewables?

Not obvious: The first lesson goes counter to much that the renewables sector has learnt.

• The success of mini-grids and the failure of national grids suggests small is beautiful.

• And there is a lot to embrace there. Mega-projects have often been letdowns. 

And yet: Morocco could not have attained its level of renewables success without them. 

• Noor Ouarzazate is the world's largest concentrated solar power plant with a capacity of 580 MW.

• The Noor Midelt Phase 1 hybrid solar power plant, to be completed this year, is designed to have an installed capacity of 800 MW

Beyond sunshine: Saharan rays are potent, but so is the Atlantic breeze.

• Tarfaya Wind Farm, one of Africa's largest, has 131 turbines and an installed capacity of 300 MW. 

• Aftissat Wind Farm went up to 400 MW after gaining 40 additional turbines. 

Game changer: A project called Xlinks wants to connect new Moroccan solar and wind generation of 11,500 MW via a 4,000-km subsea cable to the UK by 2031. 

• This would change the picture dramatically (see our chart, which includes Xlinks)

• The green light for the $30 billion project has yet to come. 

• But things are seemingly in motion, though timing remains uncertain.

Good governance: None of the progress would have been possible without investor trust.

• Mega-projects are especially vulnerable to infrastructure and policy headwinds.

• Morocco is teaching the continent a lesson in the value of stability and sophistication.

• Over 50% of projects are being developed by the private sector.

Execution game: Having good policies is great. But implementation counts even more.

• And here Morocco is out-executing many others. Components of the newly launched 270 MW Jbel Lahdid Wind Farm were manufactured at home. 

And yes: The country’s geography is also a notable asset – beyond just sun and wind.

• Proximity to European markets has enabled direct energy exports. 

• A 1,400 MW submarine Spain-Morocco cable is the continent’s first EU power link.

Being extrovert: International partnerships smooth access to financing.

• All the big EU funders are active in Morocco: EBRD, EIB, AFD, KfW invest millions.

Secondary benefits: This in turn has helped local industry and created one of the most dynamic green economies anywhere.

• Abundance of renewable energy boosts a move into energy storage systems.

• China’s Gotion High Tech put $1.3 billion into a battery production plant in Rabat.

• Morocco targets production capacity of 100,000 electric vehicles per year.

• French firm Engie eyes a $16 billion local desalination and green hydrogen project.

Taking bets: While Morocco is not yet overtaking South Africa in renewables, it has advantages that will eventually favour it.

• Morocco enjoys a more stable debt trajectory and a lower interest burden.

• South Africa is crushed by loans and a widening budget deficit limits investment.

• Morocco is developing a smart grid, while South Africa continues to face blackouts.