Economics of Transiting to Renewable Energy in Morocco : A General Equilibrium Analysis
Morocco has set an ambitious target of supplying 42 percent of electricity through renewable sources, 14 percent each through hydro, wind, and solar, by 2020. To analyze the economic and environmental implications of implementing this target, this...
| Main Authors: | , |
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| Format: | Policy Research Working Paper |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2014
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2014/06/19705743/economics-transiting-renewable-energy-morocco-general-equilibrium-analysis-economics-transiting-renewable-energy-morocco-general-equilibrium-analysis http://hdl.handle.net/10986/18828 |
| Summary: | Morocco has set an ambitious target of
supplying 42 percent of electricity through renewable
sources, 14 percent each through hydro, wind, and solar, by
2020. To analyze the economic and environmental implications
of implementing this target, this study uses a dynamic
computable general equilibrium model with foresight that
includes explicit representation of various electricity
generation technologies. Two types of policy instruments, a
production subsidy financed through fossil fuel taxation and
a renewable energy mandate financed through increased
electricity prices, have been considered to attract
investment in renewable energy. The study shows that meeting
the renewable target would achieve up to 15 percent
reduction of national greenhouse gas emissions in 2020
compared with a situation in the absence of the target, or
the baseline. However, meeting the target would decrease
household consumption of goods and services, thereby
worsening household welfare. The study also shows that the
renewable production subsidy financed through fossil fuel
taxation is superior to the mandate policy to meet the
renewable energy target in Morocco, as the former would
cause a lower loss in economic welfare and a larger
reduction of greenhouse gas emissions than the latter. |
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