RABAT, July 2 – The World Bank has approved $265 million in financing to support the construction of Morocco’s Ifahsa Pumped Hydropower Storage Project, a major energy infrastructure initiative aimed at strengthening the country’s electricity grid and accelerating the integration of renewable energy.
The financing was approved by the World Bank’s Board of Directors on Wednesday, just two days after the institution announced it would retire its target of allocating 45% of its lending to climate-related projects, while reaffirming its commitment to supporting climate investments based on client demand.
According to the World Bank, the 300-megawatt Ifahsa Pumped Hydropower Storage Project, located in northern Morocco, will function as a large-scale energy storage facility by pumping water into an upper reservoir during periods of high solar and wind power generation. The stored water will later be released through turbines to generate electricity during periods of peak demand, improving the flexibility, reliability and resilience of Morocco’s national electricity system.
The development lender said the project will enable Morocco to integrate at least 1 gigawatt of additional solar and wind energy into its national grid, helping unlock approximately $1 billion in private sector investment in the country’s renewable energy sector.
The World Bank also estimates that the project will replace around 3 terawatt-hours of electricity currently generated from fossil fuels each year, preventing an estimated 1.7 million tonnes of carbon dioxide emissions annually.
Beyond its environmental benefits, the project is expected to support economic development by creating approximately 820 direct jobs each year during the construction phase, while generating additional employment opportunities across Morocco’s broader energy sector.
The approval comes shortly after the World Bank Group announced that it would “retire” its Climate Change Action Plan lending target, following pressure from the Trump administration. However, the institution said it will renew its Climate Change Action Plan without fixed lending allocation targets, allowing climate financing to be driven by the priorities and demand of client countries. The World Bank also said its Independent Evaluation Group will conduct a review of the programme.
The Ifahsa project forms part of Morocco’s broader strategy to expand renewable energy capacity, strengthen energy security and reduce dependence on fossil fuels, reinforcing the country’s position as one of Africa’s leading investors in clean energy infrastructure.
