German bank to finance major solar plants in Morocco

1 November 2013

German state-owned bank KFW will provide an $885m loan to part finance the construction of two solar power plants in Morocco.

Together the plants will be worth an estimated $2.3bn.

Tenders for construction of the two plants, one of 200MW and the other of 100 MW, near the southern city of Ouarzazate, are expected in the next few weeks.

Mustapha Bakoury, head of Morocco’s solar energy agency, Masen, said three consortia – led by Spain’s Abengoa, GDF’s International Power and ACWA Power – have been pre-qualified to build the 200MW plant, Reuters reported.

Called Noor II, it will use parabolic mirror technology.

These three consortia also pre-qualified for the 100MW tender (Noor III), a solar power tower, along with another consortium led by France’s EDF.

The construction of two solar power plants will be half funded by a German bank loan (Wikimedia Commons)

Mr Bakoury was speaking at the Desertec industrial initiative conference.

In a comment to Reuters, head of KFW North Africa & Middle East, Wolfgang Reuss, said: "We will lend €330m [$446m] for Noor II, and €324m [$438m] for Noor III, and we evaluate the first plant contract at €1bn [$1.35bn], while the second would reach €700m [$947m]."

"It is almost the half of the necessary funds," he added.

Morocco is expecting to get loans from the World Bank, African Development Bank and the European Investment Bank of around $413.09m each and other smaller loans from the World Bank’s Clean Technology Fund, the French Development Agency and the European Union.

Saudi Arabia’s ACWA Power is already building a 160MW plant in the Ouarzazate area under a government initiative to produce 2 gigawatts of solar power by 2020, which is equivalent to about 38% of Morocco’s current installed generation capacity.

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