Jordanian MASE wins ME Award for rooftop solar project

Jordan News Agency MASE Energy

Post originally published by Jordan News Agency.

Amman, Dec. 13 (Petra) — Modern Arabia for Solar Energy, a Jordan-based regional clean energy developer, installer and O&M provider, has won the Middle East Solar Industry Association’s (MESIA) award for 2015 “Rooftop Solar Project” for a multi-household multi-location project comprising rooftop solar PV installations on 400 low-income households across Jordan with a total capacity of 600kWp. The “Rooftop Solar Project” category was awarded Thursday 10 December 2015 at the MESIA Solar Awards 2015 in Dubai, UAE. The annual event is organized by MESIA to recognize and celebrate exceptional talent and achievements in the MENA solar market.

The Rooftop Solar Project, which is being implemented in its totality by MASE under a turnkey EPC and O&M contract with Jordan’s Ministry of Energy & Mineral Resources’ Jordan Renewable Energy & Energy Efficiency Fund (JREEEF) and Mercy Corps and represents the implementation of an innovative private public partnership model to introduce clean energy solutions on a mass scale, delivering immediate impact.

Crowning MASE’s community-based solar projects portfolio, the Rooftop Solar Project represents a milestone achievement for all stakeholders and serves as a scalable model for governments, communities and businesses everywhere. The Rooftop Solar Project immediately and directly impacts over 400 low-income families across Jordan by providing them with a clean, sustainable and free source of energy. The upfront cost of the solar PV systems has been partially subsidized by a grant from JREEEF and Mercy Corps, with the balance repaid by the beneficiaries through a soft loan. The Rooftop Solar Project will serve as a scalable prototype to Jordanian policy makers in their efforts to minimize the impact of energy subsidies on Jordan’s annual budget via clean energy initiatives. It will also serve as a unique model to solar service providers and contractors of engineering and construction standardization for bulk, logistically challenging rooftop solar applications. “This milestone project is a living example of the comprehensive impact that clean energy can have on families, communities, and economies. This was a life-changing experience for all of us at MASE and the joy of knowing that each hour spent on this project will directly impact the livelihood of families across Jordan is incalculable” said Tareq Khalifeh, Director of Operations at MASE.

Jordanian solar project wins regional award

The Jordan Times-MASE Energy

Post originally published by The Jordan Times.

AMMAN — MASE, a Jordan-based regional clean energy developer and installer has won the Middle East Solar Industry Association’s (MESIA) award for 2015 “Rooftop Solar Project” for a multi-household project comprising rooftop solar photovoltaic cell installations for 400 low-income households across Jordan.

The project received the award last Thursday at the MESIA Solar Awards 2015 in Dubai, according to a MASE statement. The Rooftop Solar Project is being implemented by MASE under an agreement with the Energy Ministry, the statement said.

– See more at: http://www.jordantimes.com/news/local/jordanian-solar-project-wins-regional-award#sthash.ZJbIt7xJ.dpuf

MESIA Solar Awards 2015 – The Winners

MASE Energy MESIA Solar Awards Winner 2015

Post originally published by MESIA.com.

Utility Scale Solar Project

ACWA Power – UAE, Dubai

  • Senior Financing for Noor II and Noor III for CSP projects
  • Total of 1,600 MUSD Financing provided by MASEN
  • The loan is split in three tranches USD, EUR and MAD
  • Financing concluded within four months which is extremely fast
  • Noor II and Noor III have been globally recognized as a benchmark for future CSP
  • MASEN planning to announce two new solar plants of 500 MW each
  • Noor II and Noor III will be the largest CSP solar complex in the world and will reduce the global cost curve by 3%
  • Local procurement of the project is expected to stimulate development of Morocco’s industrial base, create jobs and bring socio-economic benefits.
 ACWA-Power-DUAL-LANGUAGE-LOGO_RGB

Small scale project

MiccGreen Tec Solar Systems LLC – UAE, Dubai

• KHK Scaffolding Industries wanted to change their diesel generator run labour camp to solar to avoid noise and pollution.
• MiccGreen Tec provided a solution which consisted of installing 56 kWp of PV solar panels, a 50 kW MICC and 228.6 kWh of battery storage
• This project is also awarded as the Solar project of the year 2015 by Middle East Electricity and was covered in Major news papers
• This is the first time in the world that a labour camp operates independently in off-grid mode completely on solar
 miccgreen

Roof Top Solar Projects

MASE Energy – Jordan, Amman

  • The project consists of rooftop PV installs on 400 low-income households with a total capacity of 600 kWp and individual capacities ranging from 1kWp to 2 kWp installations
  • The project, which is co-funded by Mercy Corps and the Jordanian Ministry of Energy and Mineral Resources’ Fund for Renewable Energy & energy Efficiency (JREEEF), is being implemented in its totality by MASE, a full-service power systems provider.
  • The project will result directly in capacity building, lowering or eliminate the electricity cost on up to 400 families (up to 1000 individuals)
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Policy Maker

DEWA – UAE, Dubai

  • Significantly increased targets for solar in Dubai mix, from 1% to 7% by 2020 and from 5% to 15% by 2030. DEWA also signaled its strong commitment to these targets and moved towards their implementation plan securing extension of the Mohammed Bin Rashid Al Maktoum Solar Park, which has now a planned capacity of 3,000MW by 2030.
  • Launched in March 2015 the Shams Dubai initiative allowing customers to install PV panels at their premises and connect to DEWA’s grid under a net metering scheme. First such scheme in GCC, supports a number of policy objectives:
  • a. H.H. Sheikh Mohammed bin Rashid Al Maktoum Dubai Smart City vision;
  • b. Green Economy for Sustainable Development initiative;
  • c. UAE agenda 2021 objectives to increases share of clean energy and improve air quality;
  • d. DSCE ( Dubai Supreme Council of Energy) 2030 energy diversification strategy;
  • e. DSCE carbon abatement strategy.
  • The increased solar targets provide the industry certainty of a significant project pipeline in Dubai to 2030
 DEWA-logo

Utility Company

DEWA – UAE, Dubai

  • 2015 has been a defining year in DEWA’s accomplishments related to solar
  • Increasing the target for renewable energy in the mix, from 1% to 7% by 2020 and from 5% to 15% by 2030, also extending the planned capacity at Solar Park to 3,000MW by 2030.
  • Launching the Shams Dubai initiative, allowing customers to install solar PV at their premises connecting to DEWA’s grid under a net metering scheme.
  • DEWA achievements are a game changer for the solar industry in the Middle East
  • The continuous large scale IPP procurement and increased targets will ensure a significant pipeline of utility scale developments.
  • The extremely competitive terms achieved in the PPA set a precedent that triggered increased interest towards solar by other regional utilities and Governments
  • Shams Dubai fostered the development of rooftop solar in Dubai (~30 contractors enrolled, ~50 manufactured registered, a number of developers looking at the opportunity), and provides a blueprint for others to replicate in the region
 DEWA-logo

Manufacturing Project

DUSOL Industries – UAE, Dubai

  • First and only PV modules manufacturing company that specializes in manufacturing PV modules in DUBAI
  • Products are specifically designed for use in small off grid application with COMPLETE AUTOMATION
  • Modules of sizes as low as 40W are made on machines that avoids human errors and assures highest quality and workmanship
  • DUSOL, as made conscious effort to bridge the gap in quality between panels used in power plants and off grid small home systems
 image25

Solar Product Innovation

Pak Agro Tech – Pakistan, Islamabad

  • Have innovated PC pump for shallow depth
  • Targeting farmers who are cultivating crops on water table less than 50 Feet depth in Punjab and KPK provinces in Pakistan
  • Successful done test trails for Grid- Tie Systems for its execution in Pakistan
  • have installed approx 300 Solar water pumps in the industry & installed Household Solar System including 1KVA to 50 KVA of different specification in the market
 Pak Agro Tech

Solar System Innovation

GlassPoint Solar – USA, Fermont

  • GlassPoint’s innovation is unlocking new market opportunities for concentrated solar power (CSP) in heavy industrial markets, such as oil and gas
  • The Middle East experiences high winds and soiling rates that can range from 10 to 30 times greater than in California and Europe
  • To overcome this challenge, GlassPoint brought together a proven parabolic trough, a commercial greenhouse structure and standard oilfield components used in commercial EOR operations today
  • The greenhouse structure reduces costs and improves performance
  • The glasshouse protects the solar array from harsh desert conditions so lightweight and inexpensive components can be used inside
 GlassPoint

Commercial Consultant Advisor

KPMG Lower Gulf – UAE, Dubai

  • Dubai Electricity & Water Authority (DEWA) has identified solar as an important part of its portfolio of energy generation.
  • DEWA appointed KPMG lead advisory team
  • The advisers were given a tight timeline of 12 months to help select the IPP developed and achieve financial closure
  • Being the first IPP in Dubai, the 200MW DEWA Solar IPP Phase II project is the largest utility-scale solar plant in the world competitively tendered in a single phase, and the first and largest in the Middle East
  • This project led to an announcement of several solar projects in the region and the DEWA project has become a globally recognized case study. DEWA too has launched an even more ambitious project for setting up of an 800 MW PV IPP project.
 KPMG

Solar Energy Picture

Enerwhere – UAE, Dubai

  • The picture was taken on the construction site of The Heart of Europe (THOE), one of the islands on the World islands in Dubai.
  • Like most islands in the Middle East, power was initially supplied by diesel generators, at very high fuel, transportation and labor costs. The project was contracted and deployed within less than 3 months.
  • Enerwhere offered The Heart of Europe a temporary power supply for its construction site on a monthly rental basis, and implemented a 25 kWp solar-battery hybrid system on Germany Island

 

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Picture11

The Rush for Renewable Energy

Venture the rush for renewable energy

Post originally published by Venture Magazine.

Following the severe disruption of energy supplies in the wake of the Arab Spring, plans are underway for Jordan to reach energy independence with the help of cutting-edge renewable power projects.

By Elisa Oddone

A heavy reliance on imported energy has weighed heavily on Jordan’s already stretched budget over recent years, prompting the government to launch a strategy that aims to raise the proportion of energy consumption met by local supplies from around two percent to almost 40 percent over the next 10 years.

Jordan imports the great majority of its energy needs, spending 20 percent of its GDP to produce electricity from cheap oil from Iraq and gas from Egypt up until recent years. Ongoing unrest in these neighboring countries has disrupted these once dependable supplies, forcing Jordan to turn to expensive oil imports.

The disruption of Egyptian gas flows, which generated 80 percent of Jordan’s electricity in the past, has spurred the Kingdom to invest in alternative energy projects to quell the growing pressure on a national budget officials have called unsustainable.

But the country has made important progress this year towards improving its energy independence. This is particularly true in the case of locally-sourced renewable power, the contribution of which the government intends to raise from 1.5 percent of the total energy mix to 10 percent by 2025. “This is a very ambitious target,” said Ziad Jibril Sabra, the director of the Ministry of Energy and Mineral Resources’ renewable energy department.

While he believes the contribution of renewables might actually reach as high as 15 to 20 percent, he stressed that Jordan’s quest to develop green fuels has not been easy. The country’s energy policies have for decades been based on favorably-priced oil pipe-in from its neighbors, which hampered any incentive to push for renewable energy projects.

Ziad Jibril

Ziad Jibril Sabra, The Director of the
Ministry of Energy and Mineral Resources’
Renewable Energy Department

“Since we as a ministry have to provide energy resources to people at the cheapest price, and our state electricity firm NEPCO also has to purchase power from the cheapest sources, it would not have been logical to resort to something else like the renewables that were expensive at the time, when we were instead able to produce power from very cheap heavy fuel and natural gas,” Jibril explained.

But Jibril added that Amman has also spent a lot of time in the past decade trying to set up an appropriate framework upon which to build the country’s renewable energy production. He said the process had been a steep learning curve for his ministry. “We have floated numerous tenders and projects since 2007 and had to establish many regulations to attract investors in the meanwhile. But we have also learned many things, mainly the legal framework, pricing mechanism, and our grid capacity.”

A major turning point came in 2012 with the introduction of the Renewable Energy and Energy Efficiency Law, the first of its kind in the region. The law dictates that the ministry issues tenders to attract competitive proposals for the development of renewable energies on selected sites. As a way to ease the project implementation process, it also allows domestic and international companies to bypass a previously complex bidding process and negotiate directly with the Minister of Energy.

 

In 2014 and under the first round of tendering, the ministry signed 12 deals with private companies to generate 200 MW. In April this year, the government announced it had pre-qualified 15 companies for the construction of a $150 million, 65 to 75 MW solar power plant in Quweira in southern Jordan. Four more companies were selected in a second-round tender the following month to develop 50 MW of solar capacity each, exploiting irradiance levels in the country’s south that are amongst the highest in the world at around 6.4 KWh/sq meters/day.

In this second round of national renewable energy Independent Power Producer (IPP) tenders, a consortium comprising Jordan’s Arabia Group and three other solar developers clinched a deal to provide a combined capacity of 200 MWp in power plants and sell electricity at record low tariffs of around $0.06 per kWh.

Arabia Group, the only company to be involved in both rounds, has already started working on a 10 MW solar energy plant in southern Jordan, said the group’s Project Development Director Tareq Khalifeh. “Most of the projects [in round one] are planned to start generating electricity by the first quarter of next year,” he said.

Tareq Khalifeh, Mase Project Development Director

Also the biggest project to be approved under the first tender round, the 52.5 MW Shams Maan Solar Photovoltaic Project—the largest privately developed solar energy project in the Middle East, according to Jordan’s Prime Minister Abdullah Ensour—has started construction on the $170 million development in June, due to be completed next year.

Khalifeh said the process leading to the second round of national renewable energy IPPs is progressing much faster than the previous one, when it took developers two years to finalize the Power Purchase Agreement (PPA) with the government. He estimates the same negotiation for round two projects will be completed in less than a year.

“We have templates in place, the bank agreements, and a proof of concept from the first round,” he said. “This makes it much easier to find investors and banks to lend money to the projects. In the first round, most of the lenders were financial institutions like the European Bank for Reconstruction and Development [EBRD] and the International Finance Corporation. There weren’t many commercial banks.”

Khalifeh said entrepreneurs looking for round two backers have spoken instead to several commercial banks and discussed lending terms, which are even more competitive than the ones offered by international lenders. Still, he would like to see more opportunities for local banks to invest in those projects, since they have been prevented from doing so by limitations on lending cycles by Jordan’s Central Bank.

FOREIGN INVESTMENT

But the void left by local investors seems to be easily replaced by international ones, who are eyeing the rising renewable energy sector in Jordan with piqued interest. This is the backdrop on which Jordan has recently signed a memorandum of understanding with the Chinese Hanergy Thin Film Power Group for the construction of 1 GW-worth of wind and solar energy projects, worth an estimated $1.5 billion and an associated 20-year PPA.

Also, Jordan’s first utility-scale wind project, run by Jordan Wind Project Company, started operation in September in Tafileh. Funding for the 117 MW wind farm came from a syndicate of six international banks spanning the IFC, the European Investment Bank, the Dutch Development Bank, the OPEC Fund for International development, and Europe Arab Bank. According to Jibril, the wind project will account for some five percent of the country’s electricity generation.

The EBRD, which has so far invested $75 million in solar projects for the construction of a 60 MW round-one site in Ma’an, also hopes to increase its shares in the sector. “We hope to be part of the financing in the second round. Discussions are ongoing with all four companies selected,” said Heike Harmgart, the head of the EBRD’s Jordan office. “This is a real growth area for us. We are very keen to scale up our investment into renewable energy in the country, an uncontroversially beneficial area of growth for Jordan.”

Harmgart said the scale of the projects has so far been small, but still shows investors Jordan’s know-how in the sector, helping attract a number of joint ventures with international players and putting the country in the perfect position to pitch for larger projects.

Even with these milestones, there are still a number of issues that have to be dealt with for the sector to advance further. Amongst the most pressing is the need to enhance energy transmission and grid capacity across the country. At the moment, Jibril said the grid can handle between 800 and 1000 MW of renewable energy without any reinforcement. But a new push is needed to launch the third round of renewable energy projects and to reach Jordan’s target of 1,600 MW from renewables by 2020.

This is where plans for a “Green Corridor” come into play. Jibril said NEPCO has secured financing from the French Development Agency and the EBRD, and will sign the agreement and float the tender for the project next month. It will be ready by mid 2018 with some additional 600 MW of renewables to the grid. Chinese Hanergy is also providing the Kingdom with a $310 million grant to expand the grid.

Meanwhile, smaller-scale solar electricity generation is also expanding at a rapid pace in Jordan. Following the 2012 Renewable Energy Law, households and businesses have been allowed to generate 100 percent of their electricity consumption through their own solar panels and sell excess output back to the grid. This has led to the installation of around 25 MW of capacity over the last year.

Former Minister of Energy Malek Kabariti

Malek Kabariti, Former Minister of Energy

To further boost uptake, the Ministry of Energy and Mineral Resources’ renewable energy fund signed agreements to fit 600 houses in northern Jordan with photovoltaic panels. The fund is also set to allocate $35 million in funding for sustainable energy projects over the next three years throughout the country.

Former Minister of Energy Malek Kabariti said his own domestic electricity bill was slashed to some $7 a month from over $140 since installing a PV system on his own roof. Despite the red tape associated with fitting these systems, he urged others to follow his lead. “Every house should have a PV system on the roof and a solar water heater in Jordan. This would benefit the economy, the pockets of consumers, and the environment.“

Khalifeh agrees and said he hoped to see more renewable energy projects, both on a country-wide scale and a local level.

“There are still some bureaucratic difficulties but the framework is developing as we talk,” he said. “The sector is becoming a place where people jump and take their chances, it is going to be the natural selection, and this is going to happen soon.”

Arabia One Solar Marks New Alliance between Alectris and MASE

Venture arabia one solar

Post originally published by Venture Magazine.

Alectris, a leading global solar asset care innovation firm, and MASE, Modern Arabia for Solar Energy, today announced its alliance on Arabia One Solar, a 10 MWp AC solar PV plant in Jordan. MASE, established by the Arabia Group of Companies, will lead field operations and maintenance services for the solar plant, supervised and supported by the global asset care technical expertise and plant management software capabilities of Alectris. The project represents the development and use of a new business model to meet the criteria of the world’s financial community and increase bankability of photovoltaic systems in emerging solar markets.

Arabia One Solar
A clean energy initiative of Jordan’s Round I Renewable Energy Program, Arabia One Solar is supported by tier one sponsors and internationally recognized bankable EPC, equipment and service providers including financing from the International Finance Corporation (IFC) and Finnish Fund for Industrial Cooperation (FINNFUND). IFC is a member of the World Bank Group, the largest worldwide development institution focused exclusively on the private sector in developing countries. In addition to Arabia Trading & Consulting (an Arabia Group company), Arabia One Solar sponsors include Ennera Energy and Mobility and Hanwha Engineering & Construction, who will also construct the project.

The Arabia One Solar PV power plant is located in the Ma’an Development Area, 218 km south of the Jordan capital of Amman. Once constructed, the plant will have a total of 45,192 photovoltaic modules with a total peak power of 11,523.96 kilowatt-peak (kWp). The energy output will be sold to Jordan’s National Electric Power Company under a 20-year power purchase agreement (PPA).

A Model to Increase Bankability in Emerging Solar Markets
The project employs a new business model for emerging solar markets. These markets hold high solar potential but have little or no industry infrastructure including qualified contractors or operations and maintenance resources to ensure long term asset productivity.

First this model draws on solar operations and maintenance expertise at the project design and development stage to engineer bankability and financial assurance into the plans for the investment team. Second it ensures long term financial viability of the asset by structuring and deploying operations, maintenance and management of the site based on worldwide best practices. Finally the strategy benefits the emerging market by providing for the rapid evolution of regional expertise by drawing on a global subject matter expert with the expressed purpose of informing the technical and infield success of the regional partner.

“The eco-system built around Arabia One Solar improved the bankability of the project for the investors and the lenders,” explains Vassilis Papaeconomou, Managing Director of Alectris. “Working together the strengths of the partners are enhanced to meet the criteria of the investment community. We can make solar more attractive for emerging markets by aligning the expertise of local companies like MASE with global best practices, including those employed by our team. We see only success with the MASE team, who bring excellent country and solar experience to the table.”

The Alectris’ Solar ERP, ACTIS, will be installed on Arabia One Solar from the start of the plant’s operation. Alectris will provide O&M services in alliance with MASE, moving to a full technical and operational knowledge transfer to the Jordanian based company further into the project’s life span.

“The solar industry in Jordan and the MENA region is growing too quickly to organically build our operations, maintenance and asset management expertise and software tools,” said Tareq Khalifeh, Director of Operations for MASE. “Our team is well versed in the development and construction of photovoltaic systems. By joining with Alectris, we can inform our operations and maintenance discipline quickly engendering deep confidence in our ability to manage Arabia One Solar and our portfolio of utility and retail distributed generation solar plants.”

Four Companies to be Selected in Second Renewables Round

Venture Four Companies

Post originally published by Venture Magazine.

As part of Jordan’s second round of national renewable energy IPPs, Arabia Group said it has been shortlisted to construct a 50 MWp plant.

The company said it’s one of four solar developers that will be selected to provide a combined capacity of 200 MWp in power plants located in Azraq, Mafraq, and Safawi. They will sell electricity at record low tariffs; $0.0613, $0.0649, $0.0691, and $0.0767 per kWh, respectively. The cheapest international prices for electricity generated from solar energy range from $0.059 to $0.11 per kWh.

“This second round will prove to be extremely beneficial to the country in many ways and has already set a new balance between prices and costs,” said Arabia Group’s Project Development Director Tareq Khalifeh, whose company’s record-breaking bid was made in partnership with construction giant Saudi Oger. “The government set a ceiling tariff of $0.169 per kWh in round one to incentivize the sector. The prices in round two set instead a new benchmark for tariffs in the market today. It is clear now that if you are above these prices, there’s a very low chance of being involved in this sector.”

Arabia Group, the only developer successfully involved in both rounds, is also developing a project as part of Jordan’s first 180 MW renewable energy IPP. The company is set to begin work soon on a 10 MW solar energy plant in southern Jordan.

As part of a drive to diversify its energy basket, Jordan aims to generate 15 percent of its energy needs from renewables by 2020. Round one plants will make up about 4,5 percent of Jordan’s energy requirements, while renewable power in round two will account for some 5 percent.

Amman’s First Wind Turbine

BeAmman MASE Wind Project

Post originally published by BeAmman.

We like to keep you posted on everything that happens around Amman, today (Dec 2 2013) we got news that Amman just got its first wind turbine!

BeAmman is a supporter of clean renewable energy which gives Jordan energy security and independence, and decreases pollution.

Modern Arabia Solar Energy (MASE) has sent us the following: “We have completed the installation of our 3.5kW fully-operational wind turbine. This is Amman’s first grid-connected wind turbine. The turbine will feed clean energy into the national grid and in return reflect monetary savings on its owner’s monthly electricity bill. This is our first wind turbine installation and we hope to able to raise enough awareness of the practical advantages of clean energy through this flagship project.  We are involved in a large-scale (10MW) photovoltaic solar power plant in Ma’an.”

This is not a paid advertisement – We are super excited about this news & look forward to seeing more renewable energy sources around Amman & the kingdom.

Go green #JO

Commercializing Clean Energy

Venture Magazine Commercializing Clean Energy MASE Energy

Post originally published by Venture Magazine.

The environmental argument for the greater use of renewable energy is solid, but can anyone really make money from it in Jordan?

With the endorsement of the Renewable Energy and Energy Efficiency Law last year, Jordan cleared a major hurdle in its race to broaden its energy supply away from its crippling reliance on expensive oil and gas imports. The law allows private companies and home owners to produce power using renewable energy sources, and receive payment for piping power back into the grid.

Several local and international companies have so far shown interest in establishing wind and solar plants in Jordan. Examples include Philadelphia Solar, as well as Modern Arabia Solar Energy (MASE),which is partnering with some of the world’s leading renewable energy companies to build its first photovoltaic solar plant.

SELLING SOLAR PLANS

Established five years ago to produce photovoltaic modules that generate electricity from the sun, Philadelphia is the country’s first company to be given the green light to establish a power plant that operates on a commercial basis through a direct proposal.

Located in Mafraq, the plant is set to generate around 10-megawatts per hour, as long as solar radiation is available. Radiation hours per year at its location are 1,700 hours, minus the nights and the cloudy days in the winter.

“Hopefully we will start the building process in two months, right after we sign the power purchase agreement and the financing agreement with the bank. Then we can start ordering the material,” said Philadelphia Solar CEO Abdulrahman Shehadeh, as he pointed at the project’s design maps laid out on a meeting table. The company will apply for a $22.6 million loan from the Arab Bank, which will cover up to 80 percent of the project’s total cost. The plant’s construction process will take up to six months to complete. 

Shehadeh believes building a PV solar plant will be a sound investment, and will create hundreds of jobs for Jordanians. “Once we settle the loan we can start generating income in seven to eight years. I think it’s very feasible,” he said, adding that his company already exports PV modules to 24 countries including the UK, Germany, Italy, Cyprus, and Saudi Arabia.

M1 CCE 052013

MASE’s Director of Operations Tareq Khalifeh agreed that generating renewable energy on a utility scale was indeed financially worthwhile. He estimates the cost of solar power projects like his to hit $2.3 million per megawatt, and the estimated annual operational and maintenance costs are up to $300,000, including insurance. “It’s very feasible. The pay-back period is typically five to seven years. The Feed-In Tariff is fixed and has been already set, so it will depend a lot on the cost of the modules and what sort of financial support you receive, whether it’s project finance or a direct loan,” he explained. 

Joining MASE in a consortium to build the 10-megawatt facility are Spain’s Ennera Energy and Mobility, and South Korea’s Hanwha Solar. The facility will be located within the Maan Development Area (MDA) in the city of Maan, which was chosen by the government for being one of the locations that receive the highest solar radiation in the world, with levels up to 2,200 kWh per square meter. 

The consortium was one of the entities that have signed an MOU with the Ministry of Energy and Mineral Resources. MASE also signed other MOUs with the land owner of the MDA in July 2011 and the National electric Power Company (NEPCO) in June 2012. “If all goes well we expect to sign the power purchase agreement in September, and taking the construction time into consideration, we can probably start production by April 2014,” Khalifeh said.

HIGHER LEVEL PLANNING

The new law stipulates that in coordination with companies like MASE, which are deemed Bulk Supply Licensees, the ministry may issue tenders or attract proposals on a competitive basis for the development of designated sites to generate electrical power. The legislation also states that, with the exception of sites that are being developed through a public tender, anyone may submit a direct proposal to the ministry or to whoever has been entrusted by the Council of Ministers in order to develop any site for the purpose of exploiting renewable energy sources.

According to industry sources, over 60 expressions of interest were submitted within the past year to the Ministry of Energy. Out of these, around half passed the qualification criteria, which say the company must be financially sound, and 12 have so far successfully submitted and signed MOUs. They now have permission to begin approaching financial institutions for funding. The qualification criteria also required that each company includes references of past experiences such as previous completed projects and financial track records, but since the majority of Jordanian companies fail to meet this particular requirement, many have opted to partner up with foreign companies.

According to energy experts, the disruption of Egyptian gas supplies to Jordan has made renewable energy a worthwhile investment because until now it had to compete with subsidized energy from Egypt.

Despite these positive developments on the legislation level, developers of power plants still have some hills to climb. Although Khalifeh is particularly excited about the Feed-In Tariff, which was set at 12 piasters (17 cents) per kWh, Shehadeh believes it’s unfair to treat different areas of Jordan equally. “The only thing that I can criticize is that they don’t distinguish between locations. For example in the South, and Maan in particular, radiation hours is 2,200 kWh per square meter, while in Irbid it’s 1,700. So they set the same rate for the kilowatt we generate in the North as in the South. It’s a big mistake,” said Shehadeh.

Yet Khalifeh argues that looking at the tariffs in terms of how they reflect on the feasibility of the project, makes it very feasible. His project is looking at an Internal Rate of Return (IRR) between 10 and 14 percent, which he says is high compared to the global standard. 

M2 CCE 052013

 Khalifeh believes current tariffs were set as an incentive to lure investors to the sector, and chances are they will not last for long. A western expert agreed, saying that to help alleviate the investor concern, the previous Minister of Energy Alaa Batayneh was able to get the Cabinet’s approval to guarantee the MOU holders the ceiling tariff rate. “That’s in place just for this year as a motivation to get the MOU holders moving. He wanted some results. I think it got the MOU holders’ attention.”

The Chairman of the Jordan Green Building Council Mohammad Asfour helped represent the private sector in drafting the law with the Parliament’s energy committee. Although he believes the law was a positive step forward, he said the private sector was not satisfied with some of its aspects, particularly the independence (or lack thereof) of the Renewable Energy and Energy Efficiency Fund whose duties include developing standards for the selection process of projects to be funded and obtaining approval for funding.

“The fund is not independent at all and is based at the ministry. I’m sure red tape will [affect their work] because I’ve worked in the government. It should have a board not a committee and the board should include members from both the private and public sectors, which is not the case,” Asfour told Venture.

Khalifeh pointed to another hurdle, which is the lack of local expertise, especially in the newly introduced renewable sector and mostly in the technical aspects.“Most of the training and education comes from on-site training. So we do plan to train our own engineers once we start developing the plant and we do plan to establish our own operation and maintenance division.”

Although investors were holding their breath during the cabinet change, fearing that Batayneh, who was an avid advocate of renewable energy, would be replaced by a less progressive minister, they were not disappointed when Malek Kabariti succeeded him. The incumbent minister has long been a proponent of renewable energy and a sturdy opponent of nuclear plans.

A SUNNY OUTLOOK 

Experts and many local officials believe that electricity generated using renewable energy is not the answer, but part of the solution. Yet Asfour argues that even if the amount of energy will be small, it’s still a strategic decision in the long run because solar prices are dropping sharply and they will likely become even more feasible in the near future. 

The push to diversify our energy resources has been welcomed by local and international energy experts particularly as it will soon start to make a dent in the country’s electricity bill. But what happens in the future depends on the investors’ appetite after this round, said Khalifeh. “This is a learning phase for the country and for international companies who’ve been involved in renewable energy…they will see how this sector is developing in Jordan. Within the next five years I think there will be an increase in the number of private developers,” he explained.