Renewable sources diversify electricity power generation in Tunisia

Despite depending heavily on gas-fired electricity production, declining productivity at key fields and rising energy imports from Algeria have prompted Tunisia to turn to renewables. The government has set out objectives to encourage development, including increasing the contribution of renewable energy to 30% of the energy mix by 2030. This is arguably an ambitious objective, especially considering that in 2016 renewable sources accounted for 3% of total electricity production. However, the establishment of such a deadline has mobilised government policy at a time when political, social and economic volatility has delayed other solutions to energy production.

Strategy

While the country has long recognised its solar and wind energy potential, policy implementation only accelerated in late 2016 after the publishing of the government’s Renewable Energy Action Plan 2030. In addition to generating roughly one-third of electricity with renewables by 2030, the plan also laid out other goals in two phases. Under the first phase, which covers the 2016-20 period, objectives included adding 1000 MW of renewable-generation capacity and reducing energy consumption by 17%. The second phase, slated to run from 2021 to 2030, will see an additional 1250 MW of new renewable generation come on-line.

Installed capacity in Tunisia at the end of 2018 stood at 240 MW of wind, 10 MW of solar and 62 MW of hydroelectric power, representing a combined 5.7% of national energy production capacity, according to Ministry of Energy, Mines and Renewable Energies (Ministère de l’Energie, des Mines et des Energies Renouvelables, MEMER).

Tender Spree

In a bid to accelerate investment and attract financing, in May 2017 the authorities launched a tender for a series of small and medium-sized solar and wind projects with a total generation capacity of 210 MW. The projects, which are forecast to cost a total of TD400m ($138.9m), will comprise 70 MW of solar and 140 MW of wind-generation capacity. Also included in the tender was a deal to sell output to the Tunisian Company for Electricity and Gas (Société Tunisienne de l’Electricité et du Gaz, STEG), the state-owned utility in charge of electricity production and distribution.

In January 2019 the MEMER released the results of the wind tender, announcing the allocation of four wind-generation projects. The winners were German contractor Abo Wind AG, which will build a 30-MW wind farm in Ben Arous; Dutch firm UPC Tunisia Renewables, set to establish 30 MW of wind capacity in Kechabta; and two French contractors, Lucia Holdings and VSB Energies Nouvelles, which will add an additional 30 MW each. Additionally, the authorities announced that six 10-MW solar projects and 10 projects with 1 MW of capacity had also been awarded. These tenders were won by several international energy contractors, including Abo Wind AG and VSB Energies Nouvelles.

International Response

In mid-2018 the country launched two renewable energy tenders for an additional 500 MW of wind and 500 MW of solar generation to be distributed to five solar and three wind power plants. In September 2018 the government announced it had received 38 offers for the solar power plants and 20 for the wind. According to international media, as of June 2019 the government had shortlisted 16 candidates for the 500-MW solar projects and set a September 2019 deadline to announce the winning companies.

The focus on renewable energy is attracting the attention of traditional hydrocarbons players. In May 2019 Italian multinational Eni began construction on a 10-MW photovoltaic solar plant near Tataouine. The project is being implemented through a joint venture between Eni and the Tunisian National Oil Company. Similarly to other renewable energy projects, output from the new solar facility will be sold to STEG.