Feature - Wind Energy

The Wind Energy in MEA:

Powering Sustainability

October 2017

Feature - Wind Energy

The Wind Energy in MEA:

Powering Sustainability

October 2017
The wind power capacity in the Middle East and Africa region is witnessing a remarkable increase and is predicted to skyrocket in the coming years according to MAKE Consulting analysts latest report "Middle East and Africa Wind Power Outlook" that states the region's capacity will reach a high of 40 gigawatts by the end of 2026 comparing to a 4.2 gigawatts by the end of 2016.

The region's new capacity additions is led by South Africa and Morocco, which accounted for 80% of the MEA's total capacity additions last year. Specifically, South Africa's Renewable Energy Independent Power Producer Procurement Program (RE IPPPP) continues to support new wind power capacity growth, although the RE IPPPP Round 4 is impacted by ongoing delays in the government's signing of Power Purchase Agreements. Meanwhile, in Morocco, the Law 13-09 (which allows private power producers to supply electricity to the grid or a third party via a Power Purchase Agreement) remains a strong driver of new wind power growth. The increasing amount of wind resources and advancement across the market value chain are expected to support the new wind-power capacity growth in the entire region. According to MAKE's forecast, the growth will result in a gradual reduction of wind power's levelled cost of electricity (LCOE), down 15% from 2017 to 2022. Nevertheless, the implementation of auctions in a number of countries in the region, including South Africa, Egypt, Morocco and the United Arab Emirates (UAE), has resulted in some of the cheapest bidding prices globally for wind and solar energy projects. Looking forward, MAKE Consulting predicts the MEA region to install nearly 40 GW of new wind power capacity between 2017 and 2026, driven by significant wind resources across the region and a more developed and experienced value chain. This last will specifically result in the gradual reduction of wind power's levelized cost of electricity, dropping 15% between 2017 and 2022. Already auctions in countries such as South Africa, Egypt, Morocco, and the United Arab Emirates has resulted in some of the cheapest bidding prices globally for both wind and solar projects - confirming that the global trend of declining renewable energy prices is not avoiding emerging economies and markets. As the world aspires for a better future, the pursuit of a clean energy and renewable resources are at the top of many countries wish list considering the social, economic and environmental development that can be reached throughout the wind power technique. Although the wind power is capital intensive, it has no fuel cost which makes its prices much more stable than volatile prices of fossil fuel sources. Adding to that, wind energy is plentiful and readily available, and capturing its power does not deplete our natural resources, which makes it a more powerful source to maintain a healthy and clean environment around the world. In fact, USD13 billion were invested in new wind power plants in 2016 in the US due to the fact that wind energy contributed 5.6% of the nation's electricity supply, more than 10% of total electricity generation in fourteen states. Wind power became the largest source of renewable generating capacity and supplied record amounts of wind energy to many parts of the country. Strong wind project construction, a growing manufacturing sector, and the increasing need for wind turbine technicians and operators allowed the industry to add jobs at a rate nine times faster than the overall job market, as wind employment grew to a record 102,500. Furthermore, investment in wind projects resulted in new revenues for rural communities, which pay for roads, teacher salaries and emergency services. In addition to that, the wind power represented the third-largest source of the US electric-generating capacity additions in 2016, behind solar and natural gas. Wind is a new cash crop for farmers and ranchers who lease small portions of their land for wind project development, while retaining the rest for agriculture.