Political instability is limiting renewable energy investments in North Africa

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Frost & Sullivan (Mountain View, California, U.S.) has released a new report which finds that political instability and delayed implementation of electricity sector reforms are limiting investments in North Africa’s significant pipeline of renewable energy projects.

The report notes that the region is seeing sharply increasing demand for power, driven by multiple factors including growing economies. And while Frost & Sullivan expects structural reforms including the establishment of independent regulators and change to fuel and electricity subsidies to be a priority, development is dependent upon the transitions taking place in the region.

“Each of the five Northern African countries has outlined a strong pipeline of power generation capacity expansion projects, including ambitious renewable energy projects,” notes Frost & Sullivan Industry Analyst for Energy & Environment Celine Paton.

“However, the pace of implementation of these projects will depend on the ability of each government to stabilize security and implement the required political and economic structural reforms.”

The company expects the demand for power in Algeria, Egypt, Libya, Morocco and Tunisia to nearly double to 120 GW by 2020. The region currently has 5.93 GW of renewable energy capacity, or roughly 9.6% of total installed capacity.

Natural gas to remain dominant in North Africa

Frost & Sullivan notes that numerous feasibility studies have found great potential for wind and solar in the region. It also finds that Egypt currently has the greatest installed capacity, followed by Morocco.

Despite this potential and the large pipeline of renewable energy projects, natural gas-fired generation is expected to remain dominant until at least 2020 in all nations except Morocco, where coal is the primary fuel.

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