International Finance Corporation (IFC) and OCP Group, the world’s largest phosphate-based fertilizer producer in Morocco, took a new step in their collaboration to increase production of low-carbon fertilisers using solar energy, helping green global food systems, and reducing their vulnerability to fluctuations in hydrocarbon prices.
Under the agreement, announced at the annual meetings of the World Bank Group and the International Monetary Fund (IMF) in Marrakech, IFC will provide OCP with a $106.34 million green loan towards the $382.83 million construction of two solar power plants that will provide clean energy to its operations in the mining towns of Benguerir and Khouribga, in Morocco, which has the world’s largest phosphate reserves.
The plants will have a combined capacity of 400MW and up to 100MWh of battery storage, making this the first large scale solar photovoltaic project with integrated storage infrastructure in Morocco – and the largest in North Africa.
The power generated by the plants will be both environmentally friendly, with zero carbon emissions, and more cost-effective than grid electricity during both daytime and evening peak periods.
A green loan is a form of financing for eligible projects that contribute to environmental objectives such as climate change mitigation or adaptation.
OCP Group Chairman and CEO Mostafa Terrab described the agreement is a major milestone towards our target of using 100% renewable energy in our fertilizer production by 2027.
“Our deepening collaboration with IFC reflects our alignment on the urgency of addressing the global challenges of food security and climate change simultaneously,” he added.
Makhtar Diop, IFC Managing Director, said that IFC was proud to support OCP in its journey to reduce its carbon footprint, a strategy that will have long-term positive effects not only in Morocco, but also on the global food supply.
“The fertilizer industry needs leading companies like OCP to embrace a sustainable path forward, and IFC is committed to supporting this important shift,” he added.
IFC’s Second Green Loan
The announcement marks IFC’s second green loan to OCP this year. In April, as part of the first phase of OCP’s 1.2GW solar programme, IFC provided a $106.34 million loan for the construction of four solar power plants, also in Benguerir and Khouribga, for a combined capacity of 202MW.
OCP’s solar programme is implemented by OCP Green Energy, a wholly owned subsidiary of OCP created in 2022 to develop the company’s renewable energy generation activities. It is part of OCP’s $13 billion Green Investment Program, which aims to increase its green fertiliser production and convert its operations fully to green energy by 2027.
The programme will also leverage the expertise of INNOVX, a multi-sectorial venture platform launched by Mohammed VI Polytechnic University (UM6P) that is dedicated to building innovative and sustainable businesses and ecosystems with a strong local impact.
Over the past three years, the COVID-19 pandemic and the war in Ukraine have pressured global food supply chains, leading to supply disruptions and price fluctuations. Reducing the sector’s dependence on hydrocarbons helps ensure sustainable food production, price stability and improved food security in developing and emerging countries.
IFC’s green loan agreement with OCP is part of its strategy to increase climate-related investments and projects in emerging markets, decarbonise economies, and adapt to a warming planet.
The project also aligns with IFC’s Global Food Security Platform, a $6 billion financing facility launched in 2022 to strengthen the private sector’s ability to respond to the food crisis and help support the sustainable production of food.