1. MOROCCO NARS/ICARDA CRP2 WORKSHOP, RABAT MAY 22, 2015 IS
SOLAR ENERGY A VIABLE OPTION TO REPLACE LIQUEFIED PETROLEUM GAS? A
CASE OF IRRIGATED AREAS USING GROUNDWATER IN MOROCCO Serghini H.,
Roberto T, Ampaitepin S., Laamari A. and Aden A. 2. CONTENT 1.
Challenge with LPG use; 2. Domestic price and subsidy energy
policy; 3. Survey sample, study sides and results; 4. Scenarios
simulating spreading out of LPG use in Morocco; 5. Solar energy
investment costs, comparison with LPG costs, Net Present Value; 6.
Valuation of CO2 Emissions; 7. Conclusions and recommendations. 3.
CHALLENGE Subsidy to LPG LPG subsidy introduced long ago purpose
provide poor households, with affordable source of energy to
incentive to switch away from wood and charcoal. Yet, unexpected
application farmers started to use LPG for irrigation purposes; In
2014 International price of a 12-litre bottle of LPG was $14 (about
100 DH). Moroccans pay just 40% of that amount as the government
fixed a retail price of $5.60 (40 DH) per bottle; Almost 100%
percent of LPG consumed in Morocco is imported, and hence it is
highly exposed to international price fluctuations; No official
estimation of LPG use for pumping irrigation water. Field
observation and survey (87%) suggest that LPG used as primary
energy source is spreading out; Meeting of the Moroccan Parliament
(Rabat - December, 2012) the use of solar panels as an alternative
to LPG: (i) Shrinking government subsidy resources; (ii) Farmers
needs to secure energy for irrigation purposes; and (iii) Concerns
for environmental aspects. 4. CHALLENGE: SUBSIDY TO PETROLEUM
PRODUCTS OVERTIME HAS INCREASED!!! * Preliminary data. Source: Cour
des comptes, Rapport sur Le systme de compensation au Maroc
Diagnostic et propositions de rforme, janvier 2014. 48.3 Billion DH
(6,350 million US$) 1.5 Billion DH (197 million US$) 36 Billion DH
(4,737 million US$) 5. SUBSIDY LEVEL BY SOURCE OF ENERGY Source:
Ministre de lEconomie et des Finances, 2014. LPG Diesel Gasoline
DH/Kg % of the price DH/L % of the price DH/L % of the price 2008
5.2 157 1.6 22 1.0 9 2009 3.0 91 0.4 6 0.1 1 2010 5.4 161 2.0 28
1.2 12 2011 7.0 210 3.9 55 2.7 27 2012 7.5 224 4.0 49 2.3 19 2013
6.7 201 3.1 38 1.2 10 Subsidy to LPG remains relatively constant,
while subsidy to diesel and gasoline tend to decrease. 6. SURVEY
Two Moroccan regions (112 households surveyed): 1) Sidi Laidi
(Settat Province of the Chaouia-Ouardigha region) 43 farmers
randomly selected 2) Ouled Zaydouh (region in Fqih Ben Saleh
province) 69 farmers randomly selected Survey streamlined 14
discussion questions around six areas: 1) Farm characteristics; 2)
Irrigation facilities; 3) Water storage; 4) Cost of pumping; 5)
Energy used by the household; and 6) Potential use of solar energy
for irrigation. and 7. SURVEY RESULTS NUMBER AND SIZE OF FARMS IN
SIDI LAIDI AND FQUIH BEN SALEH Source: Own elaboration based on
solar panel survey, 2014. Region Indicator < 5 ha 5 and < 10
ha 10 and < 20 ha 20 ha All sizes Sidi Laidi Average area (ha)
2.8 6.3 12.5 30.6 11.4 St. Deviation 13.1 Number of farms 14 9 12 8
43 Number of farms (%) 32.6 20.9 27.9 18.6 100 Maximum size (ha) 4
8 18.5 80 80 Minimum size (ha) 1.5 5 10 20 1.5 Fquih Ben Saleh
Average area (ha) 2.9 6.1 13.5 30 9.6 St. Deviation 8.7 Number of
farms 17 30 14 8 69 Number of farms (%) 24.6 43.5 20.3 11.6 100
Maximum size (ha) 4.7 9 19 40 40 Minimum size (ha) 1.2 5 10 22 1.2
8. Region One Two Three Four Five Six Total Average Number of
farmers Sidi Laidi 62.8 25.6 2.3 4.7 2.3 2.3 100 1.7 Fquih Ben
Saleh 73.9 21.7 1.4 1.4 0 1.4 100 1.4 1 AVERAGE SIZE OF FARMS
ACCORDING TO LAND OWNERSHIP Source: Own elaboration based on solar
panel survey, 2014. Region Private Collective Rented Average farm
size Sidi Laidi Ha 6.0 2.4 3.0 11.4 % 52.0 21.8 26.2 100.0 Fquih
Ben Saleh Ha 6.2 0.5 2.9 9.6 % 65.7 4.7 29.6 100.0 1 Source: Own
elaboration based on solar panel survey, 2014. Number of wells
owned by farmers (percentage) 9. AVERAGE AGE OF WELLS Source: Own
elaboration based on solar panel survey, Source: Own elaboration
based on solar panel survey, 2014. Average depth of the wells Range
Sidi Laidi Fquih Ben Saleh % Average age of wells % Average age of
wells < 10 years 38.1 4.0 12.4 7.4 10 and < 20 years 31.7
14.7 47.2 14.5 20 and < 30 years 22.2 22.4 22.5 23.5 30 years
7.9 36.4 18.0 35.9 All ages 100 14.1 100 19.5 1 Well depth in
meters Sidi Laidi Fquih Ben Saleh Number of wells (%) Average depth
Number of wells (%) Average depth < 40 m 19.7 31.4 11 19 40 and
< 50 m 19.7 42.2 11 43 50 and < 60 m 15.5 52 38.5 77.1 60 m
45.1 62.8 39.6 140.2 Total 100 50.9 100 91.9 10. PUMPS LIFETIME
DURATION, AVERAGE PRICE AND DEPRECIATION Source: Own elaboration
based on solar panel survey, 2014. Region Age < 10 years 10 and
< 20 years 20 and < 30 years 30 years All Sidi Laidi Number
of pumps in % 1.3 68.4 29.1 1.3 100.0 Pump average price (DH)*
25,000 19,709 21,522 30,000 20,434 Average pumps' lifetime in years
8.0 10.5 20.4 30.0 13.6 Depreciation DH/year 3,125 1,870 1,055
1,000 1,500 Fquih Ben Saleh Number of pumps in % 3.3 55.6 27.8 13.3
100.0 Pump average price (DH)* 15,667 22,630 28,588 28,667 24,858
Average pumps' lifetime in years 5.3 11.5 21.0 32.6 16.7
Depreciation DH/year 2,938 1,971 1,361 880 1,486 11. ENERGY COST OF
PUMPING GROUNDWATER (PERCENTAGE OF TOTAL WELLS) Source: Own
elaboration based on solar panel survey, 2014. Cost levels Sid
Laidi Fquih Ben Saleh LPG LPG Diesel Less than 0.20 DH/m3 8.8 10.3
- 0.20 and < 0.30 DH/m3 44.1 39.7 - 0.30 and < 0.40 DH/m3
38.2 27.9 - 0.40 and < 0.50 DH/m3 2.9 10.3 9.5 0.50 and <
0.60 DH/m3 2.9 5.9 33.3 0.60 DH/m3 or more 2.9 5.9 57.1 Total
quantity of wells (%) 100 100 100 Average cost (DH/m3 ) 0.30 0.33
0.67 12. SCENARIOS SIMULATING SPREADING OUT OF LPG USE IN MOROCCO
Source: Own elaboration based on solar panel survey, 2014. Scenario
1: 30% of private irrigation uses LPG; Scenario 2: 50% of private
irrigation uses LPG; Scenario 3: 75% of private irrigation uses
LPG; Scenario 4: 100% of private irrigation uses LPG. Range Sidi
Laidi Fquih Ben Saleh Less than 100 m3 /cylinder 14,0 21,8 100 and
< 150 m3 /cylinder 51,2 36,4 150 and < 200 m3 /cylinder 27,9
29,1 200 m3 /cylinder or more 7,0 12,7 Total 100 100 Average
abstraction (m3 /bottle of LPG) 140 124 1 Groundwater abstraction
per region and farmer (percentage) 13. Scenario: Percentage of
private irrigation using LPG) Amount of groundwater pumped using
LPG (billion m3 ) LPG subsidy (billion DH) Percentage increase of
2013 LPG subsidy Scenario 1: 30% 1.2 0.7 4.9 Scenario 2: 50% 2 1.2
8.1 Scenario 3: 75% 3 1.9 12.2 Scenario 4: 100% 4 2.5 16.3 1 ENERGY
COST OF PUMPING GROUNDWATER (PERCENTAGE OF TOTAL WELLS) Source: Own
elaboration based on solar panel survey, 2014. Impact of shifting
from diesel to LPG Region For the needs of Yes No No response Total
Sidi Laidi Households 7.0 90.7 2.3 100 Pumping 0.0 90.7 9.3 100
Fquih Ben Saleh Households 6.9 87.5 5.6 100 Pumping 0.0 91.7 8.3
100 1 Source: Own elaboration based on solar panel survey, 2014.
Solar energy current use 14. SOLAR ENERGY INVESTMENT, AND
COMPARISON BETWEEN LPG AND SOLAR SYSTEM COSTS Source: Own
elaboration based on interview to solar panel provided in
Rabat-Morocco, September 2014. Solar energy installation system
cost Case Well depth (m) Groundwater abstraction (m3 /day) Total
cost of the investment (DH) Annual depreciation of the whole
investment (DH) 1 30 22 25,068 2,062 2 200 140 567,312 34,492 3 49
340 293,040 18,622 4 56 65 89,296 5,982 5 80 100 188,802 12,952 6
30 50 49,760 3,790 7 90 30 89,296 5,982 8 120 153 358,017 23,199 9
46 192 330,000 18,600 Average 78 121 221,177 13,965 1 15. Source:
Own elaboration based on interview to solar panel provided in
Rabat-Morocco, September 2014. Cost of pumping water by case Case
Well depth (m) Annual quantity of groundwater pumped (m3 /year)
Annual quantity of water pumped by m of depth Annual cost (DH)
Average cost of one m3 (DH) Cost of one m3 out of one meter of
depth (DH) 1 30 10,039 301,170 2,062 0.21 0.0068 2 200 63,887
12,777,400 34,492 0.54 0.0027 3 49 155,153 7,602,497 18,622 0.12
0.0024 4 56 29,662 1,661,072 5,982 0.20 0.0036 5 80 45,633
3,650,640 12,952 0.28 0.0035 6 30 22,817 684,510 3,790 0.17 0.0055
7 90 13,690 1,232,100 5,982 0.44 0.0049 8 120 69,819 8,378,280
23,199 0.33 0.0028 9 46 87,616 4,030,336 18,600 0.21 0.0046 16.
Source: Own elaboration based on interview to solar panel provided
in Rabat-Morocco, September 2014. Cost of one cubic meter per one
meter depth (DH) 0.0000 0.0010 0.0020 0.0030 0.0040 0.0050 0.0060
0.0070 0.0080 0 50 100 150 200 250 Costofonem3outofonemeter
depth(DH) Well depness (m) Higher costs Lower costs 17. Source: Own
elaboration based on solar panel survey, 2014. Cost of pumping one
cubic meter of groundwater Liquefied gas (DH) Solar energy (DH)
Difference (%) Sidi Laidi 0.30 0.20 33.3 Fquih Ben Saleh 0.33 0.13
60.6 1 Subsidy to solar systems (simulation scenario) Source: Own
elaboration based on solar panel survey, 2014. Estimated quantity
of groundwater currently pumped (billion m3 ) Number of needed
solar panels Cost of acquiring solar panels (million DH) Budget for
50% Subsidy (million DH) Allocation of 50% of the gain from
switching to solar energy (million DH) Number of years to cover all
pumped water by solar energy 4 31,950 6.6 3.3 371 9 18. Income and
cost structure of representative farmer Crop Income (DH) Cost (DH)
Net revenue (DH) Production area (ha) Alfalfa 4,125 1,276 2,849
1.25 Corn 54,089 12,402 41,687 4.00 Olive tree 52,500 2,501 49,999
2.50 Potato 525 2,485 - 1,960 0.25 Onion 1,300 1,125 175 0.50
Sesame 3,125 1,088 2,038 0.50 Pepper 2,875 8,392 - 5,517 0.50
Citrus 1,200 1,500 - 300 1.50 Total agriculture 119,739 30,769
88,970 11.00 Source: Own elaboration based on Benchmark survey data
(ICARDA, 2010). Net Present Value (NPV) analysis 1 - (1+r)-t r x -
ICNPV = 19. Indicator NPV1 NPV2 NPV3 NPV4 NPV5 Income reduction (%)
10 20 30 40 50 New income (DH) 107,765 95,791 83,817 71,843 59,869
New net revenue (DH) 76,996 65,023 53,049 41,075 29,101 New NPV
(DH) 108,261 57,030 5,798 45,434- 96,665- Change in r (%) 30 35 40
45 50 New NPV (DH) 73,830 32,395 983 23,582- 43,290- Sensitivity
analysis, reductions in income and increases in discount rate
Source: Own elaboration based on Benchmark survey data (ICARDA,
2010). Estimated NPV investment on solar energy DH 159,493 (about
US$ 20,985) investment would be profitable Discount rate (%): r =
0.23 Time period (years): t = 20 Initial investment (DH): I =
221,177 Net income (DH): C = 88,970 Net Present Value (DH): NPV =
159,493 20. VALUATION OF CO2 EMISSIONS : ENVIRONMENTAL FRIENDLY AND
ENERGY SAVING FROM APPLYING SOLAR ENERGY IN PUMPING GROUNDWATER: A
CASE STUDY IN MOROCCO CO2 analysis: Emissions Source: Own
elaboration based on solar panel survey, 2014. Parameters LPG
Diesel Sidi Laidi Fquih Ben Saleh Sidi Laidi Fquih Ben Saleh Annual
Consumption (kg or lt /year) No. of farmers 51,040 39 165,290 56
7,400 2 72,797 16 CO2 emission per area (kg-CO2/ha/year) Equivalent
to emission amount of passenger cars /year 425 19 477 61 1,397 4
972 44 Estimation at national level Parameters LPG Diesel CO2
emission per Total Area Equipped for Irrigation (million
kg-CO2/year) Equivalent to CO2 passenger car emissions (number)
Share of all passenger cars in Morocco (%) 676.4 153,006 7.13
1,457.9 329,773 15.37 21. VALUATION OF CO2 EMISSIONS :
ENVIRONMENTAL FRIENDLY AND ENERGY SAVING FROM APPLYING SOLAR ENERGY
IN PUMPING GROUNDWATER: A CASE STUDY IN MOROCCO ( CONT.) CO2
analysis: Emissions MJ/ha/year= Megajoules per hectare per year.
TJ/year = terajoules/year Source: Own elaboration based on solar
panel survey, 2014. Parameter LPG Diesel Sidi Laidi Fquih Ben Saleh
Sidi Laidi Fquih Ben Saleh Net Heating Value (NHV) per Area
(MJ/ha/year) Equivalent to 60-watt electric bulb (bulbs/year) 6,531
8 18,976 24 7,332 9 13,206 17 Estimation at national level
Parameter LPG Diesel NHV per Total Area Equipped for Irrigation,
(TJ/year) Equivalent to 60-watt electric bulb (million bulbs/year)
10,389 13 19,810 25 22. Valuing Carbon & Carbon Trading Do you
know Carbon Emission can be traded in the market? How Agriculture
can involve in the carbon trading? 23. CONCLUSIONS AND
RECOMMENDATIONS The results of the survey implemented in Sidi Laidi
and Fquih Ben Saleh suggests there is a trend to widespread the use
of LPG (cost is much less than diesel). This is encourage by the
fact subsidy to diesel is shrinking, while keeping changeless
subsidy to LPG. If LPG use to pump groundwater widespread to 30% of
private lands, impact on government subsidy would be 0.7 billion DH
(about 92 million dollars). If it is used in 100% of irrigated
lands subsidy would grow by 2.5 billion DH (about 329 million
dollars); We estimated that in average solar energy is between
33.3% and 60.6% cheaper than LPG; NPV estimations suggest investing
in solar energy is profitable. However, sensitivity analysis
indicates the uncertainty and risk associated to solar energy.
Government might need to consider providing important subsidies to
purchase solar systems; If farmers eventually adopt solar energy,
the government should not expect that LPG system is completely
abandoned. 24. CONCLUSIONS AND RECOMMENDATIONS (CONT) Environmental
evaluation of CO2 emissions from LPG and diesel suggests that
diesel contaminates more than LPG; The level of LPG CO2 emission
emerging from pumping groundwater is equivalent to the emissions
that 7.13% of all passenger cars in Morocco generate in one year.
In the case of diesel, CO2 emissions out of pumping groundwater
would be equivalent to those generated by 15.37% of all passenger
cars in Morocco; Switching from LPG or diesel to solar energy would
mean saving the equivalent amount of energy spent by13 to 25
million 60-watt electric bulbs (depending on the type of fuel - LPG
or diesel- that is replaced). 25. CONCLUSIONS AND RECOMMENDATIONS
Once the solar energy is installed, the cost of pumping water is
almost zero. Farmers may be tempted to overuse irrigation water and
to extend their irrigated surface As a consequence, the depletion
of groundwater may be accelerated; The size of the solar energy
installed should correspond to the capacity of wells and the needs
of plants; The government should, as requirement, implement
groundwater meters to control the amount of groundwater pumped, and
to apply costing to groundwater to make it sustainable in the long
term. This measure is very challenging to implement but it is the
only way to save the groundwater; More research on solar energy and
irrigation in the frame of 26. THANK YOU MOROCCO NARS/ICARDA
PARTNESHIP COORDINATION MEETING