Background

Rapid energy demand growth (7% in 2011), limited domestic resources and regional instability, including instances of sabotage from neighbouring Egypt, have spurred the need for energy self-sufficiency in Jordan.

The Government of Jordan took concrete steps to reduce dependence on energy imports and increase the share of RE in the overall energy mix from 2% to 10% by 2020. The Kingdom is also undergoing a major subsidy reform, through a three-stage removal of fossil fuel subsidies initiated in 2008. This is expected to boost clean energy generation by removing price distortions for conventional fuels, and is accompanied by a set of compensatory measures that help cushion consumers from rising living costs.

Policy Framework

Jordan boasts some of the most complete legislation in the MENA region for renewable energy.

• National Energy Strategy (2007-2020) ;

• Renewable Energy and Energy Efficiency Law (2012), with specific regulations establishing conditions for investment, construction and connection to the grid:

- Direct proposals mechanism, allowing private investors to propose RE projects

- National Electric Power Company (NEPCO) entitled to purchase output and fund grid connection for larger projects

- Codes for energy efficiency, green building, tax incentives are under discussion

Jordan's institutional set-up is also relatively advanced:

• National Energy Research Centre (NERC, 1998);

• Renewable Energy Department at the Ministry of Energy and Mineral Resources (MEMR);

• Jordan Renewable Energy and Energy Efficiency Fund (JREEEF), set up under MEMR with funding from national and international institutions (including GCC) 3, to facilitate investment through grants, or subsidies on commercial loans and guarantees.

Target Setting

• 7% of RE in the primary energy mix by 2015 % and 10% by 2020 through 600-1,200 MW from wind energy; 300-600 MW from solar energy; 30-50 MW from waste-to-energy.

• Improve total energy efficiency by 20% by 2020 through demand-side management.

Project Pipeline

Jordan's RE market includes a number of high-profile RE projects, mainly solar and wind.

• 117 MW Tafilah Wind Project

• 100 MW Shams Ma'an Solar PV Project

• 100 MW JOAN 1 CSP Project

In 2011, the Government invited companies to submit proposals for RE generation projects to meet the target of 1.8 GW by 2020. This first Expression of Interest received wind, PV and CSP project proposals from 65 private companies. By the end of 2013, 29 contracts were signed, including the first Jordanian PPA, followed by 12 more.