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CSP guide to the

Table of contents 1. MENA industry survey 2. Notable MENA markets a. Saudi Arabia b. United Arab Emirates c. Jordan d. Morocco

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MENA region

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MENASOL 2013
5th Middle East & North Africa Solar Conference

14-15 May, Dubai

As part of the launch of this years MENASOL conference, CSP Today has compiled a guide to the hottest markets open to CSP companies in the region so that you can inform your business strategy and take advantage of the lucrative MENA opportunities. MENASOL 2013 is the leading solar event in the Middle East and North Africa region. The 2 day conference will help solve your critical challenges and connect you to local decision-makers to secure a sustainable MENA pipeline. With over 300 top attendees, this is by far the biggest, best, and most influential CSP and PV industry event in the region.

To find out more about the MENASOL conference, visit: www.csptoday.com/mena

CSP guide to the MENA region

Part 1 MENA industry survey

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INTELLIGENCE

CSP Today and PV Insider conducted an industry survey in November/December 2012 to assess the current status and priorities of international and local solar companies. Here is a select summary of the survey results:

What type of information is your business looking for regarding the MENA region in 2013?
Other Investment opportunities Cost parameters Meeting new clients

Do you have a team dedicated to solar developments in the MENA region?

12.7% 5.3% 15.3%

4.1%

Yes

New projects

%
15.6%
Ranking 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17

35.7%

47.4%
No
Policy updates

52.6%

11.3%

Technology information

Please state in order the 3 most important markets that are priority for your business in the Middle East/North Africa region in the next 12 months:
Market Saudi Arabia UAE Morocco Egypt Kuwait Oman Qatar Tunisia Algeria Jordan Libya Israel Iraq Bahrain Yemen Iran Lebanon Total Score 525 268 181 106 67 64 61 52 44 40 24 18 11 11 9 5 2 As a percentage 35.28 18.01 12.16 7 .12 4.50 4.30 4.10 3.49 2.96 2.69 1.61 1.21 0.74 0.74 0.60 0.34 0.13

Are you based in the MENA Region?

320 300 280 260 240 220 200 180 160 140 120 100 80 60 40 20 0

312

113

Markets were scored on a points system: 3 points for Market 1 (highest priority), 2 points for Market 2, 1 point for Market 3

MENA

NonMENA

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CSP guide to the MENA region

Part 2 Notable CSP MENA markets
SAUDI ARABIA Market analysis
In 2012 the Government of Saudi Arabia unveiled its ambitious plan to install 41GW of solar power by 2032, including 25GW of CSP and 16GW PV. This translates to 10% of domestic use power generated by 2020 before reaching the 41GW mark by 2030. One key factor at play in the adoption of these targets is the internal consumption of oil reserves, which continues to increase unabated. If current trends are maintained then Saudi Arabia runs the risk of becoming a net importer of oil. The IEA (International Energy Agency) recently estimated that oil production would most like raise to 12.3 MB/D by 2034, up from 11MB/D in 2011.

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INTELLIGENCE

Electricity & Cogeneration Regulatory Authority (ECRA) ERCA is the body responsible for the regulation of the electricity and water desalination industry in Saudi Arabia. King Abdulaziz City for Science and Technology (KACST) KACST is an independent scientific organization administratively reporting to the Prime Minister. KACST is both the Saudi Arabian national science agency and its national laboratories. Saudi Arabia Solar Industries Association (SASIA) SASIA is a non-profit, non-governmental association which aims to promote solar power in Saudi Arabia and across the Middle East.

Notable agencies
The King Abdullah City for Atomic and Renewable Energy (K.A. CARE) K.A.CARE was created by a Royal Order on April 17 , 2010, with a mandate to contribute to sustainable development in the Kingdom. Located in Riyadh, K.A.CARE endeavours to meet Saudi Arabias future electricity demand, projected to nearly triple in the next 20 years, while maintaining the highest industry standards for safety, security and transparency. K.A CAREs mission is to be the driving force for making atomic and renewable energy, an integral part of a national sustainable energy mix, creating and leveraging the competitive advantages of relevant technologies for the social and economic development of the Kingdom of Saudi Arabia . Key K.A.CARE Objectives: CREATE a sustainable economic sector for Saudi Arabia anchored by local alternative energy demand market CONTRIBUTE to job creation, GDP growth, environmental footprint reduction and sustainable development MAINTAIN highest levels of safety, security and transparency

CSP Today analysis:

CSP secures large portion of Saudis solar market Article by Heba Hashem, December 21, 2012 Saudi Arabia is gearing up to launch its first CSP bidding round in early 2013, which will see it offer 900MW of projects. A year later, a larger bid for 1,200MW of CSP is scheduled to open. Foreign solar power consortiums preparing to participate in the kingdoms upcoming bids would stand better chances of being selected if they were pre-informed of the operational and non-operational challenges that lie ahead of them. Manpower deficit As a country with one of the worlds highest irradiation levels, receiving an average of 2,200kWh/m2 a year and up to 2,550kWh/m2 a year at some locations, Saudi Arabia has tremendous potential to develop CSP rapidly. But the landscape is not free of obstacles. Financially, things are a bit attainable, but it remains a challenge. Human capacity is always on top of my mind as a number one challenge and priority , Mr. Abdullah Al Gahtani, Consultant at King Abdullah City for Atomic and Renewable Energys (K.A.CARE) Strategy Team, tells CSP Today. Addressing human capital shortfalls is, in fact, one of the kingdoms near-term objectives and is reflected in its present endeavours. In addition to freeing fuel for export, diversifying resources, securing funding, and reducing subsidies, the development of local know-how

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CSP guide to the MENA region

comes under the Electricity & Cogeneration Regulatory Authoritys current energy policy. K.A.CARE initiated (its mission) in April of 2010 to work on these challenges with all necessary stakeholders local and international. Every dimension has a dedicated and extensive study made for it by K.A.CARE in order to resolve the issues and go beyond that , Mr. Al Gahtani explains. According to a K.A.CARE report, human capacity development will necessitate engagement with several local stakeholders namely the Ministry of Higher Education; Technical and Vocational Training Corporation; Human Resources Development Fund; Saudi Basic Industries Corporation, and Aramco as well as international stakeholders such as universities and training institutions. Building local human capacity now would be highly rewarding on the long run; contributing to significant economies of scale for CSP costs. For example, when it comes to operations and maintenance which account for nearly 30% of costs over the lifetime of a CSP plant up to 90% could be localized and hence considerable savings could be achieved. DNI compensates for losses The kingdom also needs to deal with the operational issues of CSP deployment, as dust from sandstorms will be unavoidable. This could easily affect the operation and performance of CSP plants, and should be taken into consideration at the early stages of technology selection. We have losses due to high temperature and so on. But what we gain from high radiation more than compensates for the loss of efficiency , Maher Al-Odan, senior consultant K.A.CARE, was cited as saying by Saudi Gazette. For the successful implementation of CSP in the kingdom, Daniel Strigari, project manager at Abengoa, highlighted at the Fourth Saudi Solar Energy Forum the importance of measuring and evaluating meteorological conditions, including DNI, wind, speed, and direction, as well as reduced visibility causes like dust, humidity, fog and haze. Pilot projects could help resolve many of these operational issues. Moreover, to adapt operation and maintenance (O&M) and customize technology designs, solutions must be found for the sandstorms, cleaning requirements, and scarcity of water. Sky Fuel, a Colorado-based firm that has been seeking Saudi partners, may have an advantage over other parabolic trough manufacturers. Its Sky Trough uses unbreakable ReflecTech-based mirrors, which could reduce O&M costs and offer protection from dusty winds.

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Novatec Solars Linear Fresnel Collector Technology also holds an advantage with its automated mirror cleaning that uses very little water. Meanwhile, researchers at the Massachusetts Institute of Technology suggest that hybrid fossil-CSP plants could be an optimal solution for the kingdom, as they would overcome some of CSPs shortcomings by boosting efficiency, while providing dispatchable power without the need for storage. Faith in CSP Saudi Arabia, however, hasnt restricted itself with technology preferences and has kept all options open. We are as K.A.CARE open for all technologies and will focus on technologies that bring added value to the country by creating a sustainable, socio-economic development for the nation. In our announced targets, we believe that the proposed CSP will play a larger role and have a much better economic impact on Saudi Arabia than PV technology , Mr. Al Gahtani states. A CSP-dedicated solar policy framework and an incentive scheme are still missing, but these are currently being developed by K.A.CARE with the support of foreign consulting companies Poyry, PWC, Vinson & Elkins, Roland Berger, and Morgan, Lewis & Bockius. In Saudi Arabias ambitious plan for 2032, CSP will supply an eventual 25GW of the total 41GW of planned solar capacity, which would enable it to save billions of dollars worth of exportable oil. It is worth noting that the countrys 2009 domestic consumption of oil and gas was 69% higher than in 1999, while its consumption of crude oil for power in 2011 was estimated to be 582,000 barrels per day, up by a staggering 340% from the 2006 level, according to the Sunrise in the Desert Report. These alarming figures have undoubtedly urged the kingdom to pick up pace and set a date for its first solar power bid. K.A.CARE will start with what we named as the Introductory Round (500-800MW), to be launched with the issuance of the draft request for proposals (RFP), followed by the final RFP most of which will be CSP and PV. But (we have) not yet specified which one will be how much , notes Mr. Al Gahtani. Following that, the first CSP bidding round will offer 900MW, while the second will offer 1,200MW. The wide range of applications offered through CSP make it a natural fit for the kingdoms needs; be it electricity generation, seawater desalination or enhanced oil recovery. Not only can solar power help Saudi Arabia conserve its oil for export, but by deploying 25GW of CSP by 2032, the country could transform itself into an exporter of CSP technology.

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CSP guide to the MENA region

UNITED ARAB EMIRATES Market analysis
In 2008, the government of the UAE announced the objective of covering 7% of its energy demand using renewable energy by 2020. Owing to the local environmental conditions and resources, it is expected that solar energy will play a vital role in providing new installed capacity. The Emirate of Dubai has also announced a 1 GW Solar Park to be built by 2030. The 1 GW Mohammad Bin Rashid Al Maktoum solar park, named after the Dubai sovereign, constitutes a total investment of AED 12 billion (EUR 2.5 billion; USD 3.3 billion), and is intended to be operational by 2030. 200MW of the 1GW of solar power to be installed in this project will comprise PV, while 800MW will be CSP , according to the Chairman of the Dubai Supreme Council of Energy, Waleed Salman. The United Arab Emirates (UAE) economic and demographic growth is the main driver of the countrys rapid increase in energy demand.

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INTELLIGENCE

Abu Dhabi Water and Electricity Authority (ADWEA) / Abu Dhabi Water & Electricity Company (ADWEC) The Abu Dhabi Water & Electricity Authority researches and develops ways to more efficiently produce, distribute and consume water and electricity. ADWEA is owned by the Abu Dhabi Government, but is financially and administratively independent. ADWEC is a wholly owned subsidiary of ADWEA, and the single buyer and seller of water and electricity in the Emirate of Abu Dhabi. Masdar Masdar was launched in 2006 and organised around three business units and an independent, research-driven graduate university. The company aims to advance renewable energy and sustainable technologies through education, R&D, investment and commercialisation. Emirates Solar Industries Association (ESIA) ESIA is a non-profit, non-governmental association and aims to provide an all-inclusive platform bringing together stakeholders of the UAE solar industry. ESIA aims to expand the use of all solar technologies at national and regional level, to strengthen the local UAE solar industry, and to facilitate business opportunities for its members.

Notable agencies
Dubai Supreme Energy Council The Dubai Supreme Council of Energy (DSCE) was formed in August 2009. The Governing body seeks to ensure that the Emirates growing economy will have sustainable energy while preserving the environment. The Authority is developing alternative and renewable energy sources for the Emirate, while increasing energy efficiency to reduce demand. The Dubai Supreme Council of Energy is the governing body tasked with policy development, planning and coordinating with concerned authorities & energy bodies to deliver new energy sources while employing a balanced approach to protecting the environment. Mission: Support Dubais economic growth through secure energy supply & efficient energy use while meeting the following environmental & sustainability objectives: Effective planning of energy sector Develop an integrated approach to securing energy supply and employing efficient energy practices for the sustainable growth of Dubai Ensure sustainability of energy supply while preserving environment Rationalize use of energy and ensure environmental sustainability Plan and facilitate the execution of the strategic initiatives, demand management and supply options with view of diversifying energy sources Set a governance framework to streamline existing energy practices across the DSCE entities to optimise synergy and energy efficiency

CSP Project in the Spotlight

Shams 1 Shams 1 in Abu Dhabi uses parabolic trough technology. Upon completion it will have a capacity of 100MW, which makes it among the largest parabolic trough power stations in the world. It will displace 175,000 tons of CO2 per year and its power output will be enough to power 20,000 homes. The station will consist of 258,048 parabolic trough mirrors, 192 solar collector assembly loops with 8 solar collector assemblies per loop, 768 solar collector assembly units, and 27 ,648 absorber pipes. The basic and detailed engineering is developed by AG Ingeniera, and the project is consulted by Fichtner Consulting Engineers. The equipment is designed and delivered by Foster Wheeler, and the power station equipped by Abengoa Solar's ASTRO collectors. The 125MW steam turbine is provided by MAN Turbo, parabolic glass mirrors by Flabeg, absorber tubes by Schott AG, and the Therminol heat transfer fluid is provided by Solutia. The project is developed by Masdar, in cooperation with Spain's Abengoa Solar and France's Total. The power station is developed under a 25-year build, own and operate contract. It occupies approximately 2.5 square kilometres, and will be followed by Shams 2 and Shams 3 stations.

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CSP guide to the MENA region

CSP project in the spotlight

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INTELLIGENCE

CSP project in the spotlight

Shams 1
Current status Gross capacity Developers Commissioning 100MW Masdar Abengoa Total Parabolic Trough Abener Teyma Madinat Zayed UAE Dry

Technology EPC State/region Cooling

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CSP guide to the MENA region

Jordan Market analysis
Solar energy generation has massive potential in Jordan. The government has big plans for development stemming from the desire to reduce dependence on expensive energy imports and satisfy growing demand for energy. In the 2007 Energy Strategy, the Government of Jordan set ambitious goals for the share of renewable energies in primary energy supply to increase from the current 1% to 10% by 2020. The planned installed capacity should amount to 300MW 600MW (CSP , PV and hybrid power plants) by 2020 with the aim to locally produce 90% of energy by 2020. The Renewable Energy and Energy Efficiency Law was enacted in February 2010 which allows unsolicited or direct proposal submission. Ministry of Energy and Mineral Resources.

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In addition, the Ministry of New and Renewable Energy has requested expressions in interest and shortlisted 5 CSP projects. Currently four of them have already, or are about to, sign a memorandum of understanding - meaning that they will submit concrete development plans for the Maan Development Area. Shortlisted developers have until May 2014 to submit their final proposals and technology selections. Firas Rimawi, advisor to the CEO at the South Company for Construction and Development (the development agency for the south of Jordan) comments: The Maan Development area is ideal for solar; it is flat, making for easier construction and is well connected to roads, so making the logistics much easier. It is now up to the developers to submit competitive proposals and make this happen he says. And Georgio Akiki, AREVA Solars Business Development Manager - Middle East adds: Although the deadline is 2014, proposal submission can take place at any time. The MEMR will evaluate proposals within 6 months of submission and sign a Power Purchase Agreement within 2 months of the Notification of Acceptance, he says. But not all the proposals will come to fruition NEPCO would struggle to connect all five projects to the national grid. Akiki comments: Technical constraints mean that the government will select only the best possible projects using the direct proposal mechanism to develop the targeted 1800MW renewable energy projects as per the energy strategy. He also cites finance as a barrier to development. Unfortunately, attracting investment for renewable energy projects has been challenging. There are a variety of reasons for this, including unfavourable market conditions, challenges in project financing due to the financial crisis and the relatively small size of Jordan as a market for renewable energy. However, Jordan is a part of the MENA CSP scale-up initiative which is eligible for funding from the Clean Technology Fund (CTF). Another positive move is that the government has now published proposals for upper limits for power purchase agreements for each type of renewable energy. This will, according to Rimawi, make it easier for developers to submit proposals that are both realistic and competitive. Ultimately the industry must wait until the 2014 deadline before it will know how the CSP industry is likely to develop based on which proposals are successful. Only then will it also know whether the government will provide financial incentives or whether it will need to seek international funding. For now all developers can do is ensure that their proposals are watertight and cost efficient in the hope of being accepted.

Notable agencies
Central Electricity Generating Company (CEGCO) The Central Electricity Generating Company (CEGCO) is the largest power generator in Jordan with seven power generation complexes nationwide, totalling around 1,550MW of installed power capacity of a mixed portfolio of technology and fuel types that meet around 59% of the countrys current electricity consumption. On July 18, 2011 it was announced that ACWA Power, the Saudi-based Water desalination and Power Generation Company, completed its acquisition of a 65% controlling stake in Enara Energy Investments PSC that in turn owns 51% of CEGCO. In April, 2012, ACWA Power then completed the acquisition of a further shareholding CEGCO from Malakoff Corporation of Malaysia, by purchasing the latters 25% stake in Enara. Ministry of Energy and Mineral Resources The Ministry of Energy and Mineral Resources was established in 1984 and entrusted with administering and organising the energy sector. Electricity Regulatory Commission of Jordan The ERC, established in 2001, was created to apply the government policy of restructuring the electricity sector on the basis of equity, and provide electricity services to more than one and a half million consumers. National Electric Power Company (NEPCO) Provides electrical generation and transmission in Jordan.

Csp today analysis of Jordan

As stated above, the Renewable Energy and Energy Efficiency Law allows unsolicited or direct proposal submission. Effectively investors and developers are free to identify and develop renewable grid-connected electricity production projects such as wind parks, solar systems or others on their own and propose these to the

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CSP guide to the MENA region

MOROCCO Market analysis
The first announcement to be made in Morocco came in 2009 with the Moroccan Solar Plan, which targeted 2,000MW of solar by 2020 (or 14% of the projected energy demand). A more comprehensive plan was outlined in the Renewable Energy Law (February 11, 2010), which aimed to foster and promote renewable energy, as well as regulate the commercialisation and exportation of renewable energy. Significantly, the law also detailed the creation of the National Agency for the Promotion of Renewable Energy and Energy Conservation (ADEREE) (16.09 of January 13, 2010). This was a reorganisation and renaming of the existing Centre for the Development of Renewable Energy (CDER). Finally, it allowed public/private cooperation with regulator Office National de lElectricit (ONE).

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CSP project in the spotlight

Ouarzazate I
Current status Gross capacity Developers Development 160MW Acciona ACWA Aries SENER TSK Parabolic Trough TSK Sousse Massa Draa 550

Technology EPC State/region Net annual production expected (gwh)

Notable agencies
Moroccan Agency for Solar Energy (MASEN) MASEN aims to implement a program for the development of integrated electricity production projects from solar energy with a minimum total capacity of 2,000MW. MASEN is responsible for the design of integrated solar development projects in the areas of Morocco suitable for solar energy. Other features of MASENs role include: Conducting the technical, economic and financial studies which are necessary to the qualification of solar sites Contribution to research and to the raising of the funding necessary to the realization and to the exploitation of the solar projects Project management and infrastructure implementation lOffice National de lElectricit (ONE) ONE is the sole publicly-owned utility in Morocco, and holds a 25% stake in MASEN. The Moroccan Agency for Development of Renewable Energy and Energy Efficiency (ADEREE) ADEREE is responsible for overseeing the development and promotion of renewable energy in Morocco. Ministry of Energy, Mines, Water & Environment The Ministry of Energy and Mines is responsible for the development and implementation of government policy in the areas of energy, mining and geology, as well as control of other areas under its jurisdiction.

Notes on the project

In September 2012 MASEN announced Saudis ACWA Power in a consortium with Spains TSK and Aries were awarded to build and operate the 160MW Ouarzazate CSP plant in southern Morocco. The consortium passed the two rounds since Q4 2010 when MASEN unveiled a call for tenders. The Ouarzazate project will feature 160MW of output power and 4 hours of thermal storage with molten salts. This is the first phase for a more ambitious plan to develop solar energy in Morocco in the Ouarzazate site and other regions in the country with financing support from World Bank and African Development Bank. The three Spanish firms, TSK, Acciona and SENER provide to ACWA, the experience and knowhow in engineering, construction, commissioning and operation of concentrated solar power plants. The Ouarzazate plant will use parabolic trough technology. SENERtrough, the solar collector assembly developed by SENER. TSK-Acciona-SENER will face the challenge to design, build and commission a more cost-competitive plant for the Moroccan government and other countries interested in this technology.

For more information about MENASOL 2013 (14-15 May, Dubai), including the full agenda, speaker list and networking opportunities please visit: www.csptoday.com/mena
CSP Guide to the MENA region | www.csptoday.com/mena