The road less travelled towards solar investment seems to be Algeria. And while the country has a road map to become a solar powerhouse for North Africa, it faces several obstacles.
There are a few regional markets – such as the UAE, Morocco and Egypt – that at the moment are investment hot spots in areas such as solar, with clearly defined policies and documented progress.
And then there is Algeria.
The country recently renewed its green energy ambitions, but has yet to improve its foreign investment appeal, ranking 163rd out of 189 countries in the World Bank’s 2016 Doing Business report.
The Spanish bank Santander said this year that a series of measures taken by the government – in addition to corruption, heavy bureaucracy, a weak financial sector and legal insecurity in terms of intellectual property rights – are obstacles to investment.
Algeria has been trying to get on the renewables scene for five years, since it released a programme to produce 22 gigawatts of renewable energy, including solar photovoltaic (PV), solar thermal, wind, biomass, cogeneration and geothermal. More than half of that was slated for export.
Under this scheme, solar power – including both PV and thermal – would make up more than 15GW, according to Algeria’s government-funded Renewable Energy Development Centre. This would power about 2.5 million homes, according to the Solar Energy Industry Association.
Algeria last year affirmed these green goals, although with 6 to 13 per cent annual consumption growth expected, they now equal only 20 per cent or so of the national energy mix. As a result, the government decided that all of the renewable energy produced would be used for domestic consumption.
“It’s great that Algeria has launched this programme, but there are still some fundamental challenges with its general investment environment and around how it will execute [an independent power producer programme],” said Michelle Davies, the head of clean energy and sustainability at the UK law firm Eversheds.
She said that these factors combined will likely impact the immediate success of the renewable energy programme, but it didn’t mean that the landscape couldn’t change later.
Yet for Renewable Energy Partner (REP), a boutique advisory and project development firm operating in Algeria, it could just be a matter of the country’s lack of marketing prowess. “There’s a disconnect between the perceived risk and the reality,” said Adel Baba-Aissa, the director of REP.
He said there had been little international investment in the past decade as a result of high oil prices, which resulted in high revenue for government coffers. Rather than Algeria taking international investment, it used its oil revenue to fund government projects. In fact, the country had created a renewable energy fund taking 1 per cent of oil fees to finance its projects.
But the drop in the price of oil has hampered Algeria. The country has combined its renewable energy fund with an energy efficiency fund to shore the pair up, and is considering increasing the rate of its tax on hydrocarbons.
REP set up in the country three years ago, hoping to be one of the first shakers in its solar market. “If you understand how to play by the rules, you’ll be successful and have quite an advantage – which has been the case,” Mr Baba-Aissa said.
REP last year partnered with a large company to launch a 5 megawatt project and is now looking to start projects four times that size. “The target total this year is at least two projects that combined would total 50MW,” he said. And in five years, REP is targeting 200MW of projects.
The company is also launching its first private independent power producer for solar PV in the country. However, the evolving regulatory framework has delayed the launch. “That’s given us time to put financing in place, so we’re hopeful that this year will be quite a big year for us in general,” he said.
The country’s solar sector will struggle to meet the government’s ambitious goals. BMI Research, a unit of Fitch Group, said that Algeria’s solar power capacity would reach 326MW in 2020, up from 120MW at the end of last year; however, this was still well below the 800MW target for 2020.
According to BMI, the problem is a lack of appetite from foreign investors.
“When you’re taking early-stage development risks, not many people want to put in money,” added Mr Baba-Aissa. REP uses its own funds, and once the project is evolved the company exits and uses that capital to fund other projects.
Yet Algeria is forging ahead, with a big announcement expected to come this summer in terms of ramping up solar investment. However, many people are waiting for development agencies to enter to offer an insurance policy of sorts to mitigate the risks.
And until that happens, many foreign investors will likely watch from afar as they plough a trail in Egypt or Morocco.
LeAnne Graves covers renewables for The National.
lgraves@thenational.ae
Follow The National's Business section on Twitter
The specs
Engine: Long-range single or dual motor with 200kW or 400kW battery
Transmission: Single-speed automatic
Max touring range: 620km / 590km
Price: From Dh250,000 (estimated)
How Beautiful this world is!
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Sun jukebox
Rufus Thomas, Bear Cat (The Answer to Hound Dog) (1953)
This rip-off of Leiber/Stoller’s early rock stomper brought a lawsuit against Phillips and necessitated Presley’s premature sale to RCA.
Elvis Presley, Mystery Train (1955)
The B-side of Presley’s final single for Sun bops with a drummer-less groove.
Johnny Cash and the Tennessee Two, Folsom Prison Blues (1955)
Originally recorded for Sun, Cash’s signature tune was performed for inmates of the titular prison 13 years later.
Carl Perkins, Blue Suede Shoes (1956)
Within a month of Sun’s February release Elvis had his version out on RCA.
Roy Orbison, Ooby Dooby (1956)
An essential piece of irreverent juvenilia from Orbison.
Jerry Lee Lewis, Great Balls of Fire (1957)
Lee’s trademark anthem is one of the era’s best-remembered – and best-selling – songs.
If you go
Where to stay: Courtyard by Marriott Titusville Kennedy Space Centre has unparalleled views of the Indian River. Alligators can be spotted from hotel room balconies, as can several rocket launch sites. The hotel also boasts cool space-themed decor.
When to go: Florida is best experienced during the winter months, from November to May, before the humidity kicks in.
How to get there: Emirates currently flies from Dubai to Orlando five times a week.
The BIO:
He became the first Emirati to climb Mount Everest in 2011, from the south section in Nepal
He ascended Mount Everest the next year from the more treacherous north Tibetan side
By 2015, he had completed the Explorers Grand Slam
Last year, he conquered K2, the world’s second-highest mountain located on the Pakistan-Chinese border
He carries dried camel meat, dried dates and a wheat mixture for the final summit push
His new goal is to climb 14 peaks that are more than 8,000 metres above sea level
Mica
Director: Ismael Ferroukhi
Stars: Zakaria Inan, Sabrina Ouazani
3 stars
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Winners
Best Men's Player of the Year: Kylian Mbappe (PSG)
Maradona Award for Best Goal Scorer of the Year: Robert Lewandowski (Bayern Munich)
TikTok Fans’ Player of the Year: Robert Lewandowski
Top Goal Scorer of All Time: Cristiano Ronaldo (Manchester United)
Best Women's Player of the Year: Alexia Putellas (Barcelona)
Best Men's Club of the Year: Chelsea
Best Women's Club of the Year: Barcelona
Best Defender of the Year: Leonardo Bonucci (Juventus/Italy)
Best Goalkeeper of the Year: Gianluigi Donnarumma (PSG/Italy)
Best Coach of the Year: Roberto Mancini (Italy)
Best National Team of the Year: Italy
Best Agent of the Year: Federico Pastorello
Best Sporting Director of the Year: Txiki Begiristain (Manchester City)
Player Career Award: Ronaldinho
Sarfira
Director: Sudha Kongara Prasad
Starring: Akshay Kumar, Radhika Madan, Paresh Rawal
Rating: 2/5
The specs
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Transmission: 9-speed automatic
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Mountain%20Boy
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MATCH INFO
Uefa Champions League semi-final, first leg
Bayern Munich v Real Madrid
When: April 25, 10.45pm kick-off (UAE)
Where: Allianz Arena, Munich
Live: BeIN Sports HD
Second leg: May 1, Santiago Bernabeu, Madrid
Company%20Profile
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Turning%20waste%20into%20fuel
%3Cp%3EAverage%20amount%20of%20biofuel%20produced%20at%20DIC%20factory%20every%20month%3A%20%3Cstrong%3EApproximately%20106%2C000%20litres%3C%2Fstrong%3E%3C%2Fp%3E%0A%3Cp%3EAmount%20of%20biofuel%20produced%20from%201%20litre%20of%20used%20cooking%20oil%3A%20%3Cstrong%3E920ml%20(92%25)%3C%2Fstrong%3E%3C%2Fp%3E%0A%3Cp%3ETime%20required%20for%20one%20full%20cycle%20of%20production%20from%20used%20cooking%20oil%20to%20biofuel%3A%20%3Cstrong%3EOne%20day%3C%2Fstrong%3E%3C%2Fp%3E%0A%3Cp%3EEnergy%20requirements%20for%20one%20cycle%20of%20production%20from%201%2C000%20litres%20of%20used%20cooking%20oil%3A%3Cbr%3E%3Cstrong%3E%E2%96%AA%20Electricity%20-%201.1904%20units%3Cbr%3E%E2%96%AA%20Water-%2031%20litres%3Cbr%3E%E2%96%AA%20Diesel%20%E2%80%93%2026.275%20litres%3C%2Fstrong%3E%3C%2Fp%3E%0A
The specs
Engine: 2.7-litre 4-cylinder Turbomax
Power: 310hp
Torque: 583Nm
Transmission: 8-speed automatic
Price: From Dh192,500
On sale: Now
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RESULT
Liverpool 4 Southampton 0
Jota (2', 32')
Thiago (37')
Van Dijk (52')
Man of the match: Diogo Jota (Liverpool)
COMPANY%20PROFILE%20
%3Cp%3E%3Cstrong%3ECompany%20name%3A%20%3C%2Fstrong%3EAlmouneer%3Cbr%3E%3Cstrong%3EStarted%3A%3C%2Fstrong%3E%202017%3Cbr%3E%3Cstrong%3EFounders%3A%3C%2Fstrong%3E%20Dr%20Noha%20Khater%20and%20Rania%20Kadry%3Cbr%3E%3Cstrong%3EBased%3A%20%3C%2Fstrong%3EEgypt%3Cbr%3E%3Cstrong%3ENumber%20of%20staff%3A%20%3C%2Fstrong%3E120%3Cbr%3E%3Cstrong%3EInvestment%3A%20%3C%2Fstrong%3EBootstrapped%2C%20with%20support%20from%20Insead%20and%20Egyptian%20government%2C%20seed%20round%20of%20%3Cbr%3E%243.6%20million%20led%20by%20Global%20Ventures%3Cbr%3E%3C%2Fp%3E%0A
The%20specs
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COMPANY PROFILE
Name: Almnssa
Started: August 2020
Founder: Areej Selmi
Based: Gaza
Sectors: Internet, e-commerce
Investments: Grants/private funding
The Penguin
Starring: Colin Farrell, Cristin Milioti, Rhenzy Feliz
Creator: Lauren LeFranc
Rating: 4/5