Jordan turns to wind power in search of renewable energy

With its increasing energy consumption, Jordan has launched wind power projects in a bid to lessen dependency on imports.

al-monitor Cracked earth marks a dried-up area near a wind turbine, Sept. 15, 2013. Photo by REUTERS/Carlos Barria.

Topics covered

solar turbine, solar energy, jordan valley, energy, electricity shortages, economic policy

Aug 5, 2014

Jordan is carrying out a project to use wind power in Tafila province in the south of the country. The project’s energy production is around 117 megawatts per hour, generating 400 gigawatt hours yearly. The Jordan Wind Project Company (JWPC) will provide the necessary supply for the Jordan Electric Power Company (JEPCO) to carry out the project’s commercial execution in mid-2015, with an estimated cost of around $285 million. JWPC is a joint project between InfraMed (50%), Masdar in Abu Dhabi, UAE (31%) and EP Global Energy (19%). The cost of generating electricity from wind power is estimated at around $120 for every megawatt hour, which is significantly lower than conventional sources of electric power.

Tafila wind farm was granted around $221 million worth of loans to fund this project from the International Finance Corporation (IFC) — the World Bank’s investment institution in the private sector. The European Investment Bank (EIB), the Eksport Kredit Fonden, the OPEC Fund for International Development (OFID), the Europe Arab Bank and the Capital Bank of Jordan also participated in financing the project. The participation of international finance institutions such as OFID, IFC and EIB guarantees the project’s transparency in contracting and covering necessary expenses, in addition to providing loans and abiding by environmental policies. These institutions give out loans based on the project’s economic feasibility.

Economic laws help avoid many of the current questions raised by many Arab countries concerning the economic feasibility of certain projects and their governance authenticity. The Tafila wind farm project is the first of its kind in Jordan and the region in which a private company uses wind power to generate energy. The project includes installing 38 turbines (3 MW per turbine). The strategy adopted by the energy sector of Jordan aims at having renewable energy rise to 10% of the total energy and reach 8%-10% of the consumed electricity in Jordan by 2020. The Tafila wind farm is expected to generate electricity with a cost 25% lower than thermal energy, which would lower CO2 emissions by 40,000 tons per year.

The Ministry of Energy and Mineral Resources is working on launching a second wind-power project. Last week, the ministry signed a contract with the Spanish company Elecnor for a project designed to generate wind-power energy in Maan [south of the capital, Amman.] The available information shows that this project is going to be funded by the Gulf grant program, Kuwait Fund for Economic Development. On this project as well, the Arab funds create a transparency for contracting and covering expenses. These funds also collaborate in order to make sure that the projects are being executed according to the required laws of governance. It is noteworthy that the Maan project is based on a construction contract called Turnkey, whereby the project is the government’s property. It includes installing 33 turbines, each with a rated power of 2 megawatts [or more]. ... It will cost about $112 million. Commercial production is expected to start in the fourth quarter of 2015.

Jordan sees adopting renewable energy as an urgently needed economic step, since imported energy currently represents around 90% of the total consumption in the country. The import of energy costs Jordan more than 40% of its yearly budget. Like all other Arab countries lacking major energy resources, Jordan is facing negative reactions from the public concerning its fuel and electricity subsidy policies, especially if this support decreases in light of the high percentage of these expenses on limited-income household budgets.

The renewable energy programs are a perfect option for Jordan, which is still lacking in hydrocarbon resources, in addition to its water shortages, with its availability of wind and solar energy. Amman is in desperate need of an increase in electrical energy in the near future. Jordan's population has reached around 6 million, with a yearly increase of around 8% (a very high percentage worldwide). The electricity sector in Jordan must add 1,500 MWs by 2020, or 40% of the currently available power.

Needless to say, adopting renewable energy programs will not meet the energy consumption of the entire country. However, it would allow Jordan to rely on a reasonable proportion of local energy resources, in addition to lowering the cost of its imports. Renewable energy is the first step to support the national economy with local energy resources and decrease the expenses on the yearly budget. More importantly, it would guarantee sufficient energy supply, so the country would not stay dependent on an unstable foreign energy supply. It is well known that Jordan has suffered a lot from the blockage of Egyptian natural gas supply through the Arab gas pipeline, as a result of the constant bombing of the pumping station of al-Arish during the past few years.

Continue reading this article by registering at no cost and get unlimited access to:
  • Al-Monitor Archives
  • The Week in Review
  • Exclusive Events
  • Invitation-only Briefings

More from  Walid Khoudouri