Casablanca – The European Bank for Reconstruction and Development (EBRD) has approved a $325 million loan for the electricity branch of Morocco’s National Office of Electricity and Drinking Water (ONEE). This funding aims to strengthen the financial stability of the Office, support its energy transition, and diversify its funding sources. At a time when financial and environmental challenges are intensifying, this loan provides crucial support for ONEE to maintain its balance and invest in a more sustainable future.

A sector under pressure

The Moroccan energy sector, particularly the electricity division of ONEE, is facing complex challenges. Since the COVID-19 pandemic, electricity demand has significantly increased due to the revival of industrial activities. Simultaneously, declining rainfall levels have negatively impacted hydroelectric production, leading to a greater reliance on more expensive energy sources. Additionally, rising global fuel prices have further exacerbated financial pressures on the national electricity system. In response, ONEE is intensifying efforts to secure diversified funding sources to ensure financial stability and meet the growing electricity demand.

Restructuring financial balances

This EBRD loan aligns with ONEE’s broader strategy to restructure its financial standing by providing long-term resources. The funding will enhance the Office’s resilience against price fluctuations and economic crises that could impact the energy sector. More than just financial assistance, this support also plays a pivotal role in Morocco’s transition toward cleaner and more sustainable energy sources.

A loan focused on sustainability and decarbonization

Beyond financial support, this loan is structured as a sustainability-linked loan, encouraging ONEE to achieve specific environmental objectives. These include reducing CO₂ emissions and increasing the share of renewable energy in its overall energy mix. Unlike traditional financing, the funds allocated by the EBRD will not be used for fossil fuel-related projects but will exclusively support initiatives aimed at improving energy efficiency and sustainability.

Technical assistance for a greener future

In addition to the financial package, the EBRD will provide technical assistance to support ONEE in implementing its decarbonization strategy and transitioning to cleaner electricity production. This assistance includes:

  • Support for the implementation of Law 48-15, which regulates Morocco’s electricity market.
  • Guidance on digital transformation, including the development of a strategic roadmap for digital innovation.
  • Assistance in establishing a long-term decarbonization trajectory, helping ONEE gradually phase out fossil fuel assets.

Advancing Morocco’s energy transition

This collaboration between the EBRD, ONEE, and the Ministry of Energy Transition represents a significant step in Morocco’s efforts to reduce reliance on polluting energy sources and improve electricity market governance. Through this project, ONEE will benefit from strategic support to modernize its operations, accelerate its digital transformation, and achieve Morocco’s sustainability and carbon neutrality goals.

With Morocco being a founding member of the EBRD and a key beneficiary of its financing programs since 2012, this partnership highlights the country’s ongoing commitment to a cleaner and more resilient energy future. To date, the EBRD has invested $2.6 billion in Morocco across 65 projects, further reinforcing its role in the nation’s sustainable development.