Competitiveness And Private Sector Development Renewable Energies In The Middle East And North Africa Policies To Support Private Investment

This report makes the case for a stronger deployment of renewables in the Middle East and North Africa and identifies the appropriate support policies required to stimulate the necessary private investment.

This report makes the case for a stronger deployment of renewables in the Middle East and North Africa and identifies the appropriate support policies required to stimulate the necessary private investment.

This publication reviews measures taken to support investment policy and governance reforms in Iraq.

Given the chronic power shortages faced by numerous developing countries, and the need everywhere to keep pace with demand, understanding the drivers of public private partnerships (PPPs) in energy is critical. While many private electricity projects have been delayed and financing costs have increased, the impact of the global financial crisis was less severe than that of previous crises that originated in developing countries. This resilience stems from developing countries’ need to expand generation capacity, electricity sector reforms and better regulatory frameworks, and short-term solutions (such as rental power plants). The study reports the evidence from statistical analysis and a sample of case studies selected based. It proposes a novel analytical approach to model PPPs, using a two-stage procedure based on Heckman’s sample selection distinguishing between those factors that determine whether private investment in energy takes place, and those that influence the volume of investment. The results of the analysis provide the following conclusions: • Both general governance and regulatory instrument primarily affect investors’ decisions to enter the various power sector markets, not the subsequent level of investment – indicating that investors seem to be adequately protected against risks. • Support mechanisms, like feed-in tariffs, are crucial for attracting investors in renewable generation, but they do not succeed in displacing fossil fuel investment and they could play a bigger role in affecting the level of investment in renewables. • There is a significant trade-off between effectiveness and efficiency of alternative instruments for deploying renewables. Feed-in tariffs tended to be quite effective but to be set on the high side, reducing incentives to cut costs and posing significant strains on already stripped national budgets. Competitive auctions, on the other hand have tended to be efficient but initially low and not always the most effective instrument. • Countries can scale up renewables following different paths. For Brazil, the move from feed-in tariffs to auctions enabled it to both reduce costs and deploy additional capacity. Peru followed in Brazil’s path, opting for auctions instead of introducing feed-in tariffs. On the other hand, China’s move from competitive tenders to feed-in tariffs allowed for discovery effects to determine the right level of prices to attract private investment in renewables.

How do Middle East energy transitions fit into international energy markets? In this book, energy analysts, geopolitical experts and specialists of political economy examine the new energy potential in the Middle East. The particular focus surrounds how the region's access to finance, combined with the new global regulations and considerations of economic development, shape the region's energy transitions overall. The Middle East is revealed to be a key site of new energy production, sharing and transmission as well as technology innovation. At the same time, the authors examine the variables that determine the success in each country and energy source, including the advantages that hydrocarbon producers will have in renewables and transition fuels, and the risk that these might slow down the energy transition overall. In doing so, the book situates the energy transition in the Middle East in a broader context of economic development, financing models, and regulations, and explains how this context interacts with the development of new energy sources. Energy Transitions in the Middle East is an account of the challenges Middle Eastern states will face in navigating the global energy transition, as well as their key areas of opportunity.

The Middle East and North Africa (MENA) are in disarray, and shifts in the field of energy have the potential to drastically affect the course of political and economic developments in the region. Declining oil prices, skyrocketing domestic demand, the rise of unconventional oil and natural gas production in North America, as well as shifting patterns of global energy trade all put severe pressures on both producing and importing countries in the MENA region. Policy-makers are facing fundamental challenges in light of the duality of grand transformations in (geo)politics and energy. Changes in the field of energy require substantial political and economic reforms, affecting the very fabric of sociopolitical arrangements. At the same time, the MENA region’s geopolitical volatility makes any such reforms extremely risky. Including contributions by academics and analysts from both inside and outside the MENA region, this volume explores the changes in global and regional energy, the impact of changing international energy dynamics on politics and economies in the MENA region, and the challenges that will result. This is essential reading for researchers, postgraduates, and professionals in Middle Eastern and North African politics, global energy governance and regionalism.

The Middle East and North Africa region has been the focal point of large investments in renewable energy, primarily due to high solar irradiation and wind speed in coastal areas. Most countries in the region have set renewable energy targets to diversify their energy mix. Investments have also been motivated by the expected socio-economic co-benefits including job creation, supplier development, increased export revenues and local tax base, and technological spillover into other industries.This study explores what Morocco can gain from renewable energy projects and which policies are appropriate to maximise their development effects. Morocco provides an interesting case to examine, as the country currently imports more than 95 per cent of its energy, and its energy demand is expected to triple by 2030. This dependence on imports provides a strong incentive for exploiting local renewable energy sources. Moreover, Morocco suffers from high unemployment and therefore needs to link new investments to job creation; but so far, its level of industrial development and competitiveness are low. To respond to these challenges, the Moroccan government has engaged in an ambitious process of developing the renewable energy industry. What distinguishes Morocco from neighbouruing countries is its commitment to linking solar and wind electricity generation projects to industrial development, employment generation and competitiveness more generally. At the same time, the potential for green electricity exports to Europe, facilitated by Morocco's proximity to Spain, offers unique market opportunities. The efforts made by Morocco's government to maintain political stability in times of turmoil across the MENA region reinforce Morocco as a potential upcoming market for solar and wind energy, as the huge investment in the first large-scale renewable energy projects show. Our studies shows how a strategic combination of complementary policies for supplier development, training, finance and technological learning could contribute to positioning Morocco as a regional and global player in the renewable energy sector.

Energy insecurity is not normally associated with the Middle East. However, away from the oil-rich Persian Gulf, the countries of the eastern Mediterranean are particularly vulnerable. Their fossil fuel endowments are low, while their fractious relationships with each other have long fostered wider political insecurities. Focusing on the Jordan Basin (Israel, the Palestinian Territories, Lebanon and Jordan), this timely volume addresses the prospects for the adoption of renewable energy in the oil-poor Middle East. Featuring regional energy experts, it offers an invaluable survey. After outlining the regional security context, this book first reviews renewable energy policy and practices in the Jordan Basin. It then considers options for greening energy use, including promising pilot projects in North Africa. The initiatives discussed encompass renewable energy finance, energy-efficient rural communities, and solar and wind energy. There is significant potential for an increase in the uptake of renewable energy technologies in the eastern Mediterranean. This window of opportunity has been created by high oil prices, energy infrastructure investment opportunities, and the UN climate change regime. In conclusion, the book considers the institutional conditions for collaborative decision-making on renewable energy. Such cooperation would deliver substantial security and human development benefits to the region, and indeed the world.