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Reforming the entire energy system and making the switch to relying more on renewable energy remains a priority for Tunisia. However, the energy transition remains intimately connected to political stability.
Tunisia plans to invest over a billion dollars in renewable energy in the next two years. The scheme aims to reduce the dependence on fossil fuels and overcome structural challenges.
Tunisia recently launched a call for a bid on renewable energy projects to produce 1,700 megawatts (MW) nationally by 2025, including the Hecha and Khobna photovoltaic plants and eight solar projects of 100 MW each. The bid also calls for eight new wind farm sites of 75 MW each.
According to the development plan, the projects are worth 1.6 billion dollars and aim to boost the production of renewable energies and renew the country’s global position.
Since 2011, following the overthrow of former President Zine el-Abidine Ben Ali, Tunisia has suffered an economic crisis exacerbated by political instability and worsened by the Covid-19 pandemic. Despite all the efforts in this area, the country remains increasingly poor in its energy balance and dependence on fossil fuels.
Tunisia’s need for a continuous energy supply and long-term energy security for industrial and socioeconomic development forced the country to transition to renewable energy as a central pillar of its development plan.
Tunisia Energy Sector Overview
Tunisia’s national electricity grid, with a total power production of 20,086 gigawatt-hours, is well developed and connects almost the entire population. The State power utility company (STEG) controls 91.7 per cent of the installed power production capacity and produces 84 per cent of the electricity in the country. Carthage Power Company, the only independent power producer, provides the remainder through a 471-MW combined-cycle power plant.
According to the National Agency for Energy Conservation, transport has the greatest impact on energy consumption as it uses 36 per cent of the total energy. The industrial sector is the second biggest consumer and accounts for 30 per cent of energy consumption in the country. The remainder is split between the household energy consumption needs of the population and public building maintenance.
Around 97 per cent of Tunisia’s electricity comes from fossil fuels, particularly natural gas imported from Algeria, which in 2021 served 45 per cent of Tunisia’s energy needs. Between 2010 and 2021, the energy sector recorded a decrease of 4 per cent per year, while demand has grown continuously by 2 per cent annually over the same period. The energy mix currently consists of 53 per cent natural gas and 44 per cent raw petroleum materials, while renewable energies only contribute 3 per cent.
Tunisia created the Energy Transition Fund (FTE) in 2013, representing an essential tool for developing energy efficiency and renewable energy through subsidising long-term projects. In 2015, following the FTE, new regulations obliged the government to increase renewable energy.
Despite efforts in past years, Tunisia has been struggling to reduce its dependence on imported fossil fuels. Due to legislative hurdles and poor management, the country is experiencing a significant delay in the various programmes and projects that depend on renewable energies.
The new package proposed in January 2023 by Naila Nouira, the Tunisian minister of Industry, Mines and Energy, aimed at accelerating the rate for the implementation of renewable energy projects.
To include Tunisian households and private companies in the transition and raise general awareness, the government plans to revoke energy subsidies for citizens and push for the adoption of solar panels as effective alternatives. Additionally, the scheme includes loans for private companies wishing to switch to renewable energy.
Belhassan Chiboub, the director-general of electricity and energy transition at Tunisia’s Ministry of Industry, Energy and Mines, explained that the electricity sector in Tunisia is suffering from a serious crisis, commenting that the electricity deficit was around 59 per cent in 2019.
Chiboub said that generating electricity from renewable sources – solar energy in particular – has seen significant development in recent years and reached a capacity of between 20 and 30 megawatts per year. He underlined that this represents a great achievement, although more has to be done by the government and citizens.
National Renewables Projects
Renewable energy projects for wind in the country are based on the construction of large plants funded by international investments. The two major wind power plants are located in Bizerte and Sidi Daoud. The wind farm in the northern city of Bizerte consists of two plants, Metline and Kchabta, built in 2012 and expanded in 2015, owing to funds from the Spanish government. STEG inaugurated the Sidi Daoud plant in 2000, thanks to investments from the Global Environment Facility and the United Nations Development Programme.
The Tunisia Solar Plan is the main framework concerning solar energy and photovoltaic parks. It was launched in 2009 and implemented by STEG ER (Renewable Energies), a subsidiary of STEG in charge of managing investments in renewables. Among the initiatives is the Tunisian Solar Programme (PROSOL), a joint initiative of the UN Environment Programme, the Tunisian National Agency for Energy Management, STEG and the Italian Ministry of the Environment, aiming to expand the development of solar energy through financial incentives.
Another notable project, the TuNur, filed with the Tunisian Ministry of Energy in 2017 and still under construction, aims to create a thermodynamic solar power plant in the Tunisian desert – particularly in the southern region of Kébili – and a consequent cable connection for the export of energy to Europe.
Policy and regulatory issues regarding energy policies, lack of objectives, unstable regulatory frameworks and a monopoly in the energy market have been obstacles to international investments in Tunisia.
The country’s political instability does not favour consistent and effective foreign direct investments. Despite numerous attempts, Tunisian institutions have not yet met the ambitious goal of implementing long-term programmes addressing the current structural challenges.
This is because Tunisia’s elite remains embedded in a capitalist framework that imposes a search for endless growth, prioritising private profit rather than public interest, resulting, as Sean Sweeney remarked, in “an energy expansion, rather than an energy transition.”
Reforming the entire energy system and making the switch to relying more on renewable energy remains a priority for Tunisia, with the ultimate goal of attracting foreign investments and reducing energy dependence. However, the energy transition remains intimately connected to political stability, especially for socioeconomic equality and political freedom.