Marrakech – The World Bank Board of Directors on Wednesday approved $265 million to finance the Ifahsa Pumped Hydropower Storage Project in northern Morocco, one of the most significant clean energy infrastructure investments of its kind on the African continent.
Located near Chefchaouen, the 300-megawatt facility will function as a large-scale rechargeable battery for Morocco’s national electricity grid. During periods of high solar and wind output, the plant will pump water to an upper reservoir. That stored water will then be released through turbines to generate electricity at times of peak demand.
The project will enable Morocco to integrate at least 1 gigawatt of additional renewable energy into its grid and help unlock around $1 billion in private investment, according to the World Bank. It is expected to replace roughly 3 terawatt-hours of fossil fuel-generated electricity per year, avoiding an estimated 1.7 million tons of carbon dioxide emissions annually.
On the economic front, the construction phase alone is projected to generate approximately 820 direct jobs annually, with additional employment expected across the broader energy sector.
Moroccan businesses will benefit from access to cleaner electricity, the World Bank noted, suggesting this would strengthen their competitiveness in international markets that increasingly require low-carbon supply chains.
Ahmadou Moustapha Ndiaye, Division Director for the Maghreb and Malta at the World Bank, described the initiative as an example of “transformative partnerships,” bringing together “multilateral institutions and national authorities” to invest in infrastructure that delivers “environmental, social, and economic dividends.”
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The World Bank’s financing package combines resources from the International Bank for Reconstruction and Development (IBRD), concessional financing from the Clean Technology Fund, and a grant from the Livable Planet Fund.
The African Development Bank (AfDB) is co-financing the project, which will be implemented by Morocco’s National Office of Electricity and Drinking Water (ONEE).
However, the approval comes just two days after the World Bank announced it would “retire” its target of devoting 45% of lending resources to climate-related projects, following pressure from the Trump administration.
The development lender said it would renew its Climate Change Action Plan without specific lending input targets, while its Independent Evaluation Group will conduct a review of the plan.
The Ifahsa project fits within Morocco’s broader push toward clean energy, driven in part by consecutive years of drought and climate shocks that have severely impacted the agricultural sector. A World Bank report in May found that clean energy investments through 2030 could yield around 28,000 net jobs per year across the Moroccan economy.
The report also stressed the strategic urgency of the transition, noting it is “highly needed to ensure access to the EU market” given the European Union’s Carbon Border Adjustment Mechanism, which requires exporting industries to maintain a low carbon footprint.
In June, the World Bank had already approved a separate $400 million Morocco Climate and Risk Finance Program to bolster the country’s financial resilience against climate, disaster, and cyber risks through investments in renewable energy, energy efficiency, sustainable transport, and water infrastructure.
The Ifahsa project adds to that momentum, positioning Morocco as a leading destination for multilateral clean energy investment on the continent.
