Assessing the energy transition through the ICOR framework: A case study of Morocco's energy strategy (2009-2030)

Abstract

In a global context characterized by the energy crisis and climate change, energy transition becomes crucial offering new prospects for efficiency and sustainability. Several investments have been made in renewable energy and energy efficiency programmes to successfully carry out the energy transition. This raises the question of the profitability of technical investments in the energy transition. As per the New Public Management (NPM), the ICOR index is a relevant macroeconomic indicator to measure the efficiency of public energy investment. The case study of Morocco through the analysis of its National Energy Strategy 2009-2030 at the end of 2023 allowed us to analyze the articulation between the realizations in terms of objectives set and the financial profitability of investments. The adopted methodology focused on analyzing the secondary data (Central Bank, HCP, IEA,…), to compare the evolution of the indicators related to strategic objectives with the investment and growth rates and ICOR. According to ICOR analysis, Morocco's efficiency of investment for generating economic growth has been low and unstable in the country. In conclusion, the inclusion of the ICOR index in the pre- and post-investment assessment of energy transition-related investments will allow Morocco to boost economic growth and improve investment efficiency.