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Renewable Energy in Tunisia - Sunny Side Up

Tuesday, 25 May 2010 15:00

Tunisia Solar Plan - Tunisia is ramping up investments in renewable energy projects in an effort to both trim its own electricity bill and pave the way for many exports, following the announcement that it would participate in a multibillion-euro scheme that could grow into the largest international energy programme ever deployed.

While long having backed the development of a mix of renewable energy sources, it seems the Tunisian government is now shifting its focus towards the solar option (though still supporting other alternative energy forms such as wind power and biomass).

Late last year, the government launched a €2.05bn programme to reduce the country's dependence on energy sourced from hydrocarbons, with the scheme aiming to fund more than 40 separate renewable energy projects while also introducing subsidies for solar panels, lowering the cost of technology so as to encourage citizens and businesses to install panels.

The Tunisia Solar Plan foresees a mix of public and private funding to pay for the programme, with the state taking the lead in some of the major projects, including three large-scale solar developments, and the private sector contributing to 29 separate schemes. Among its objectives, the government hopes the initiative will bring about a 22% reduction in demand for conventional energy sources and cut carbon emissions by 1.5m tonnes a year, while increasing renewable energy production to 550 MW by 2016.

To help meet this goal and to encourage private use of solar energy, the government has reduced the price of solar panels by around 30%, with the Tunisian Electricity and Gas Company (STEG) cooperating with the banking sector to put in place an easy billing system that allows buyers to pay off their purchases in installments over a five-year term.

Profit provides another incentive for the private sector to install alternative energy generation capacity. The government has enacted legislation allowing for unused surplus, up to 30% of total production, to be sold on to STEG. While this will probably have little real benefit to householders, private sector businesses that invest in renewable energy plants could well offset the cost of acquiring the technology within a few years, quite apart from the savings to be accrued from meeting their own electricity needs.

Though substantial, the investment for the Tunisia Solar Plan is but a fraction of that proposed under an ambitious scheme that could see the country become a major energy exporter in the coming decades. Under the Desertec Industrial Initiative (DII), €303bn would be spent on establishing power generation capacity in North African states such as Tunisia and a high-voltage direct current transmission grid to allow electricity exports to Europe.

According to Bernd Utz, chief technology officer of the renewable energy division of the German firm Siemens – one of the key partners in the DII project – thanks to its existing experience with solar energy, Tunisia is well placed to be a leading player in the scheme and thus stands to gain from it.

"I think the main benefit for some North African countries like Tunisia is that, for the first time, there is more available renewable energy," he said in an interview with international media in late April. "So, it's just having more power in the grid, which could help meet the increasing demand. Secondly, it's creating qualified jobs and economic development skills. And thirdly, the project can open a channel for exports and revenue."

Though still very much on the drawing board, DII is being pushed forward by its supporters, with plans being drawn up that would see initial production begin by 2020, with up to 15% of Europe's electricity needs to be met by the African sun by 2050.

Tunisia is also involved in the early stages of the Mediterranean Solar Plan, a separate EU-backed scheme that envisions investing more than €38bn to construct solar energy plants in Mediterranean and North African countries. The output of these plants would then be exported to Europe, as part of the EU's commitment to meeting 20% of its electricity consumption via renewable sources.

In the meantime, Tunisia is also investing in wind energy as a viable alternative to conventional sources of electricity. Currently, some 6% of the country's electricity needs are met by wind farms, with output expected to rise to 300 MW by next year and up to 1000 MW in the years to come.

Although working to bolster other renewable energy sources, the Tunisian government is pouring resources towards the solar sector in a bid to keep the lights on at home, while cashing in on Europe's burning need for more power.

Global Arab Network

This article is published in partnership with Oxford Business Group

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