Green Innoboost

Government: Morocco

Responsible government entity: IRESEN (Institut de Recherche en Énergie Solaire et Énergies Nouvelles [Research Institute for Solar Energy and New Energies])

External partner: N/A

Target type of innovator: Moroccan early-stage start-ups and other innovators that are trying to move from the laboratory to having a viable company and tested product on the market (technology readiness level [TRL] 6-8)

Links: www.iresen.org/

Key elements:

• The initiative provides funding that recipients can use for a variety of purposes: to acquire equipment, test and certify the prototype, pay staff, or buy consultancy.
• Applicants can choose to receive the funding either as a non‑dilutive grant or an equity investment from IRESEN, in addition to access to a 1.5‑year programme of business services and connections to Moroccan experts
• Support for procurement to help start-ups manage costs is included in the programme

Since Morocco published its National Energy Strategy and established IRESEN to build Morocco’s clean energy innovation capabilities, IRESEN has shifted from supporting only R&D and laboratory infrastructure to also helping the potential products from the R&D projects to reach markets. Objectives of the National Energy Strategy include:

• Develop low-cost, non‑complex technologies that can meet the needs of the African market.
• Develop the capacity to be a technology exporter to advanced economies.

These objectives contribute to the overarching desires to contribute to Moroccan economic prosperity by fostering local wealth creation and to quicken Morocco’s energy transition (including the target of 52% renewables in the electricity mix by 2030) by building local capabilities and reducing reliance on technology imports.

Green Innoboost is one of two categories of programme run by IRESEN since 2018. The other is Green Inno-project, which targets earlier-stage R&D projects (TRL>3). IRESEN refreshed the format of Green Innoboost in 2021; this case study reflects the new system, called Green Innoboost 2.0.

There was a first Green Innoboost call in 2018 and a second one in 2021. IRESEN stipulates the technology themes that are eligible for each call, in response to government priorities. The programme requires a consortium approach, with a requirement to have a Moroccan scientific institute or university as a project partner and an encouragement to include a Moroccan industrial partner. International partners are also possible, but only their costs incurred in Morocco are eligible for financing on the terms applicable to Moroccan partners. Applications are evaluated by IRESEN and experts from IRESEN’s network, including international experts who can assess overseas market potential.

A unique design feature of Green Innoboost 2.0 is that it gives the applicants the choice of receiving the financing of up to MAD 1.5 million (Moroccan dirham) (USD 160 000) either as a grant or as equity. If they select to receive it as a grant, they must pay royalties to IRESEN worth 1.5% of any annual revenue from the innovation supported by the grant from the third year after the first revenue and for an indefinite period. If they select to receive it as equity, they yield up to a 20% stake to IRESEN, the possible future sale of which will be used to help IRESEN finance activities in support of the Moroccan clean energy innovation ecosystem.

In both cases, the funding is conditional on it being spent on eligible project costs over 1.5 years. The central element of the project must be technical, with eligible costs for grant expenditures including:

• equipment for testing and prototyping
• recruiting new team members
• international travel and attending conferences
• engaging external advisers and business services.

IRESEN disburses the financing by providing the recipients with a bank account in their name from which they can transfer the funds to pay for eligible expenses. This overcomes concerns about the risk of transferring money to companies that do not have strong balance sheets or credit ratings. In the case of equipment procurement, the equipment becomes an IRESEN asset if the project is not successful.

IRESEN can facilitate access to well-equipped laboratories in its own platforms or in partner universities, a unique service compared with other start-up support organisations in Morocco. IRESEN platforms include:

• Green Energy Park, a site for solar energy testing, research and training inaugurated in 2017.
• Green & Smart Building Park, an R&D and testing facility for building energy efficiency and smart technologies for renewable energy integration in buildings. The site has been operational since 2019, with only its R&D centre still under construction in 2021.

A range of business services from advisers and consultants are eligible costs for spending the funds, including intellectual property and legal services. IRESEN is exploring how to complement this with more direct provision of services, via training sessions and webinars. The intention would be to allow recipients to customise their programme but keep costs low by providing the services in group settings.

For scientific services, IRESEN manages a scientific board of advisers who review the projects’ challenges. The access to the technical expertise of the consortium partners is a central element in evaluating the strength of the project applications.

IRESEN has a procurement team that scouts for and negotiates with potential suppliers. While start-ups can propose a preferred supplier, these are checked for quality assurance and reliability as per public procurement guidelines.

IRESEN connects start-ups with experts and investors in their network, both in Morocco and overseas.

The Covid-19 pandemic has reduced the amount of peer-to-peer contact within the projects of the first cohort that started in 2019. However, the intention of the programme is to facilitate peer-to-peer networking within and between cohorts in the future.

IRESEN has an international outlook to boosting clean energy innovation in Africa. It co‑funded a solar research platform in Côte d’Ivoire to test solar in tropical conditions, equivalent to Morocco’s Green Energy Park.

N/A

Morocco launched Al Moukawala, a nationwide programme to have a platform where start-ups can identify the support organisations most adequate to their needs and development stage.

In 2020, Morocco launched INTILAKA, a funding solution with several commercial banks to make it easier for entrepreneurs to access banking. It can fund up to MAD 1.2 million (USD 130 000) at a 2% interest rate.

In 2021, National Agency for the Promotion of Small and Medium-Sized Enterprises and the association of incubators, Moroccan Start-up Ecosystem Catalysts, signed the Tatwir Startup, an agreement to support start-ups through pre‑incubation, incubation and industrialisation. IRESEN is working on a partnership to provide support for prototyping of new technologies.

Fonds Innov Invest (FII) was established with support from the World Bank in 2017 and operated by TAMWILCOM, formerly the Moroccan Central Guarantee Fund. FII channelled equity, grants and interest-free loans via four venture capital funds and 16 incubators and accelerators with the aim of funding 300 start-ups in three years. The programme did not fully cover incubators’ operating costs, which made it challenging to meet the target. It did not specifically target clean energy.

Long-term Europe-Africa Partnership on Renewable Energy (LEAP-RE) is a programme co‑funded by the European Union’s Horizon 2020 budget. It aims to increase the use of renewable energy by supporting research, demonstration and technology transfer projects in Africa and the European Union. In most of the participating countries, SMEs are eligible to be project partners.

This publication has been produced with the financial assistance of the European Union as part of the Clean Energy Transitions in Emerging Economies programme. This publication reflects the views of the International Energy Agency (IEA) Secretariat but does not necessarily reflect those of individual IEA member countries or the European Union (EU). Neither the IEA nor the EU make any representation of warranty, express or implied, in respect to the article's content (including its completeness or accuracy) and shall not be responsible for any use of, or reliance on, the publication.

The Clean Energy Transitions in Emerging Economies programme has received funding from the European Union’s Horizon 2020 research and innovation programme under grant agreement No 952363.