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Q&A with Brahim Allali, author of Promasol and Temasol case studies (Morocco)

Brahim Allali is a Professor at HEC Montreal where he teaches Entrepreneurship and Small Business Management as well as International Strategic Management. Dr. Allali holds an Msc in International Business, another one in Banking from ITB-CNAM (France), and a PhD degree in Business Administration from HEC Montreal affiliated with the University of Montreal. Before dedicating himself to teaching, research, and consulting, Doctor Allali had spent many years working in industry and banking. He is also a Consultant with many international organizations such as the WTO, the World Bank, International Trade Centre, and Islamic Centre for Development of Trade. Doctor Allali has published two books: “Audit-export” and “Vision des dirigeants et internationalisation des PME”, as well as many scientific and professional papers. He has also given many presentations on Entrepreneurship, Small Business Management, Corporate entrepreneurship, and International Development.

TEMASOL is a joint-venture between the oil and electricity French companies TOTAL and EDF created in 2002 within the framework of a national program championed by Morocco’s National Electricity Office aiming at electrifying rural regions of the country through renewable sources of energy.

To download the TEMASOL case study from the GIM database, please click here.

PROMASOL was launched in 2002 by the Moroccan Ministry of Energy and Mines to promote the market of Solar Water-Heaters (SWHs) in Morocco through quality improvement and certification, awareness raising campaigns, and training and certification of qualified solar water-heaters’ installers.

To download the PROMASOL case study from the GIM database, please click here.

What is the basic value proposition of TEMASOL and PROMASOL?

In Morocco, only 12% of rural homes had access to electricity until 1994 when the government, through the National Electricity Office (ONE), decided to expand access to electricity in rural areas. As ONE could not cost-effectively supply grid-based electricity to all rural homes because of their remoteness, it decided to delegate electricity distribution in these areas to a few subcontractors.

TEMASOL was awarded the largest concession thanks to the expertise of its parent companies and its partners both in solar energy and in rural electrification. The success of TEMASOL in supplying the first 16,000 households with photovoltaic kits encouraged ONE to grant it new contracts to supply electricity to more than 58,000 scattered homes and hamlets in 29 provinces. More than mere access to a brighter lighting, access to electricity provided by TEMASOL has brought to these people the right to enjoy better welfare and productivity.

As for PROMASOL, it strives to democratize access to solar water-heaters (SWH) in Morocco. Indeed, for a country with 3,000 hours of sun per year (5.5 kwh/m2/day), continuing to almost totally depending on imports for its energy needs would seem a real paradox. Moreover and in addition to reducing the burdensome energy bill and reallocating the country’s limited resources towards developmental and social projects, having recourse to solar energy entails many unquestionable benefits at economic, environmental and social levels.

What were some of the challenges hindering TEMASOL’s development and growth and how did the company overcome them?

TEMASOL faced many challenges such as cash-flow difficulties due to late payments, high upfront capital cost, local agents’ training costs, increasing costs induced by rapid growth, lack of local capacity, difficulty of doing R-D, and the absence, in the contract with ONE, of a provision permitting to adjust prices to follow costs fluctuations. TEMASOL managed to overcome most of these challenges thanks to technical assistance provided by its parent companies EDF and TOTAL, the physical presence in rural areas of the company’s agents to collect monthly fees from customers and provide after-sale services to end users, and subsidies received from the Moroccan government through ONE. However, no solution has been found yet to the problem of the price adjustment mechanism.

What was the role played by the UNDP in PROMASOL?

PROMASOL is a key component of a comprehensive program initiated in 1997 involving UNDP and the Moroccan ministries of Agriculture, Environment, and Energy and Mines (MEM) with a view to preserving environment, strengthening sustainable development, and promoting renewable energies. In this context, PROMASOL was assigned the mission of promoting the solar water-heater (SWH) market in Morocco while other programs have been striving for implementing solar-energy-based solutions in other fields such as hammams heating (traditional steam rooms) and rural electrification through photovoltaic systems.

In this context, PROMASOL was created after a funding agreement was signed in 2001 between the Moroccan MEM, and the UNDP. Its management was entrusted to the Center for Development of Renewable Energies (CDER) within the framework of cooperation between the MEM, the FGEF, the UNDP, and other partners. Its cost amounted to USD 43,270,000, of which UNDP directly contributed USD 250,000, in addition to USD 500,000 within the framework of a UNDP-funded project on environment protection and natural resources management.

What role do the Moroccan government and the National Electricity Office play in these two models?

In the TEMASOL project, both the Moroccan government and the National Electricity Office (ONE) played a critical role in creating a conducive environment to starting the business and providing the initial opportunity for its development. The government decided to expand access to electricity to rural areas and allotted the necessary funds to finance such an ambitious program. ONE made it come true by subcontracting its implementation to companies such TEMASOL and tightly supervised the whole process since its inception.

Regarding the PROMASOL program, it was instigated by the government through the Ministry of Energy and Mines and implemented by the Center for Development of Renewable Energies.

Based on these two experiences, what are the prospects of mainstreaming solar energy in Morocco and beyond?

The success of all solar energy projects in Morocco such the ones implemented by TEMASOL and CDER (PROMASOL), has encouraged the Moroccan authorities to launch even more ambitious solar projects. In this respect, a solar energy project worth USD 9 billion which officials said will account for 38% of the country’s installed power generation by 2020. The project will involve five solar power generation sites across Morocco and will produce 2,000 megawatts of electricity by 2020.

What has been your personal experience going through the GIM training and case research process?

Before participating in the GIM training on writing cases that took place in Bratislava, Slovakia, in July 2009, I had written several successful cases dealing with managerial and organizational situations some of which had been published in scholarly journals. This is to say that I was not expecting to learn new things during the Bratislava workshop. However, the case research process presented during the workshop was so effective and so helpful that I started using it since then and until now in writing new cases. For instance, a few months after the Bratislava workshop, I was hired by Industry Canada to write six case studies on small-large firms’ strategic alliances. The new-learned method proved extremely effective in collecting, selecting, organizing, and analyzing data. The output was of such an excellent quality that Industry Canada officially congratulated me.

In addition to the new case method, the GIM training taught me to always consider the social, economic as well as environmental impact of situations that I study in addition to their challenges and constraints.