Supporting Jordan's Renewable Energy Journey

With EAB’s financial support, one of the largest solar plants in the Middle East, the Falcon Ma’an Solar Plant, has recently been connected to the Jordanian national grid. This pioneering project, which sees Jordan become the leading solar powered nation in the region, will have a positive impact on the country’s ability to provide sustainable energy for future generations.

The project is just one of 8 renewable energy projects in Jordan that EAB has contributed to since it first provided debt finance to the Tafilia Wind project in 2014. Working with the International Finance Corporation (part of the World Bank Group), EAB has been one of the only commercial banks, alongside the development finance institutions, to support the projects.

Throughout the last 12 months, 7 of the projects have reached commercial operation, on time and on budget; one of the key benefits of these technologies is that they take a fraction of the time to construct in comparison to conventional thermal power stations.

Why is Jordan ideal for renewable energy?

Historically Jordan’s lack of conventional hydrocarbon resources has meant that it imports more than 90% of the fuel needed to meet its power requirements and this is at considerable cost to the country. Relying on its neighbouring countries for fuel, it has experienced gas supply disruptions in recent years. The country’s renewable strategy is not only about the environment, but also about creating security of supply.

There is an abundance of cheap desert land in Jordan with little agricultural use. Much of the country is relatively high, with altitudes exceeding 1000m. These provide good conditions with both strong and dependable migratory winds of more than 7 metres per second and also high solar irradiation levels of around 2,200 watts per metre squared; a level roughly twice that available in Northern Europe. Jordan commonly enjoys 300 sunny days per annum.

High altitudes help by reducing atmospheric interference with solar rays and provide cooler temperatures than at sea level. This is important as solar panels lose efficiency as they get warmer. Therefore the conditions for both wind and solar actually maximise during the winter/spring months in Jordan. For solar the highest power output is forecast to be in March and April when the sun is high in the sky and air temperatures are below 25 °C. On a seasonal basis of course, when the sun shines the winds tend to be lighter and vice versa. There is a negative correlation between the power sources, and this helps to manage overall production.

How are technologies in the industry improving?

Whilst onshore wind production is relatively mature; solar photovoltaic production continues to improve in terms of efficiency. The typical panels (roughly the size of a large flat screen TV) have continued to fall in price to currently USD150 per panel, but are now producing 350 watts, up from 100 watts just a few years ago. Another 20MW plant EAB supports in Mafraq is 660,000 square metres in size, housing 77,000 panels. In Jordan we have supported projects that contain panels permanently fixed in place (on a 19° angle facing due south) and also panels that track the sun, by moving throughout the day from -50° to +50° during daylight hours. The tracking panels are of course more expensive to construct and operate but produce around 15-30% more power. It’s a commercial choice.

The cost of the projects has also reduced over time for Jordan. The progressive policy saw prices per kilowatt hour for the first round of solar and wind projects more than halve for the second round of projects in a competitive bidding process. This reflects the initial cost of putting in place a new industry and getting developers comfortable that the technology works and teams can be mobilised to build in Jordan’s deserts. This process also allows the state authorities to learn how to gradually incorporate the new power into the grid, remembering that the first solar projects are relatively small, being 10 and 20MW plants, and the second round being plants of 50MW in size.

The strategy is to build an industry, with trained workers and expertise at each level of construction and operation, in assimilation with the grid, as Jordan will learn to manage production. This means a "smart" metering system that will progressively use weather forecasting to more accurately predict solar and wind generation and efficiently manage the conventional thermal (gas and heavy fuel oil) production that will be used in total to meet Jordan’s growing power demands.

At present, the wind and solar production is at approximately 300-400MW and this will rise within the next 2 years to 500-600MW. This will amount to around 12-15% of Jordan’s power needs. At the same time, the government has also purchased 160 Tesla electric cars for government officials in a bid to encourage the public to also opt for ‘green’ transport; Jordan is well placed to set up a national grid of charging points. Soon, we could see a real drop in fuel imports for Jordan in terms of power generation and transport use with renewable power supplying the electric vehicles directly.

EAB’s Real Impact

EAB is proud that we are able to provide finance to this new phase of power generation in MENA. We are changing the landscape of the region whilst also, hopefully, positively affecting the lives of residents and future generations by providing sustainable solutions. On a larger scale, EAB is contributing to the slow process of weaning the globe off carbon emitting power production.

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