VZCZCXYZ0000
RR RUEHWEB

DE RUEHRB #0847/01 2881533
ZNR UUUUU ZZH
R 151533Z OCT 09
FM AMEMBASSY RABAT
TO RUEHC/SECSTATE WASHDC 0746
INFO RUEHCL/AMCONSUL CASABLANCA 4734
RUCPDOC/DEPT OF COMMERCE WASHDC

UNCLAS RABAT 000847 
 
SENSITIVE 
SIPDIS 
 
DEPARTMENT PLEASE PASS TO OPIC - B BRERETON 
 
E.O. 12958: N/A 
TAGS: EINV ENRG SENV TRGY MO
 
SUBJECT: OPIC-SUPPORTED RENEWABLE ENERGY INVESTMENT 
FUND 
 
REF: STATE 95170 
 
¶1.  (U) Summary: Morocco's energy sector is expected 
to require nearly USD 12 billion of investment in 
the next six years, including USD 7.6 billion for 
electricity production.  The Kingdom's energy 
strategy calls for renewable energy to make up one- 
third of the new production capacity.  Moroccan 
officials welcome foreign investment in the energy 
sector, and Embassy interlocutors have indicated a 
need for additional sources of financing.  The 
stated goals of the USRG Emerging Market Fund 
(reftel) appear compatible with Morocco's energy 
strategy and development priorities. 
 
Energy Requirements 
------------------- 
 
¶2.  (U) Morocco's Ministry of Energy, Mines, Water, 
and the Environment forecasts a requirement for 
approximately USD 11.5 billion in investment in 
Morocco's energy sector in the next 6 years, 
including USD 7.6 billion for electricity 
production.  Morocco's national energy strategy, 
published in March 2009, anticipates adding 6,600 
megawatts (MW) of new electricity production 
capacity by 2020.  The strong share of renewable 
energy projects in the future generation plans 
(about one-third of total new capacity) appear to 
align well with the Fund's objectives for 
investment. 
 
¶3.  (U) Ministry of Energy and wind power trade 
journals variously estimate Morocco's wind 
generation potential at 10,000 to 21,000 MW. 
Morocco currently has approximately 300 MW of 
installed wind generation capacity, with a goal of 
1500 MW installed by 2012 and 2200 MW installed by 
¶2020.  The Ministry of Energy expects to generate 20 
percent of the country's electricity supply from 
wind by 2020. 
 
¶4.  (U) Other renewable energy sources under 
development include hydroelectric (currently 1600 MW 
installed capacity, and 440 MW programmed for 
construction), and solar thermal and photovoltaic 
(PV) (20 MW solar thermal plant under construction, 
and plans to install 200,000 PV kits for remote 
households, for a total generation capacity of over 
400 MW). 
 
Project Financing 
----------------- 
 
¶5.  (SBU) The National Electricity Office (ONE) has 
no plans to finance or construct new production 
facilities itself, preferring to sign power purchase 
agreements (PPAs) with independent power producers 
(IPPs), of which two exist already in Morocco 
(including Morocco's largest power plant, currently 
owned by an Emirati firm, but previously owned by an 
American energy company).  Moroccan Ministry of 
Energy and ONE officials have repeatedly stressed to 
Embassy officers that Morocco invites additional 
foreign firms to operate IPPs in Morocco, as well as 
foreign investors to provide the capital necessary 
to finance power projects.  However, foreign firms 
working in renewable energy in Morocco tell us that 
in spite of government policies welcoming foreign 
investors, they have experienced delays in obtaining 
bureaucratic authorizations required to commence 
their projects. 
 
¶6.  (SBU) Although Moroccan banks are healthy and 
have not significantly scaled back lending in the 
global economic downturn, there are a large number 
of capital-intensive developments in Morocco (in 
housing, transportation, tourism, and other 
sectors).  This means that Moroccan projects 
frequently look abroad for financing.  Traditional 
sources, including Persian Gulf-based investors, 
have dramatically reduced financing since 2007, 
suggesting that U.S. financing would be welcome 
here. 
 
¶7.  (U) The Mission has no information to add 
concerning the local reputation of "US Renewables 
 
Group, LLC," the prospective fund manager. 
 
KAPLAN