If Tunisia wants to meet their 30% electricity from renewables by 2030 target, they need new streams of capital to extend credit facilities to the industry, and capacity building among local banks to extend credit facilities to improve local investment conditions.
This is according to a new report from the International Renewable Energy Agency (IRENA). Renewables Readiness Assessment Report: Tunisia was developed in consultation with the Tunisian Ministry of Industry, Energy and Mines and the National Agency for Energy Conservation.
The report says measures to reform Tunisia’s renewable energy sector’s financial instruments and encourage greater involvement from national financial institutions are critical to achieving the country’s energy transformation goals. It also recommends the establishment of a national electricity regulator and the simplification of procurement and permitting processes.
Mohamed Boussaîd, minister of Industry, Energy and Mines: “Tunisia is determined to accelerate its energy transition over the next decade with a view to achieve energy security through a diversified energy mix and to improve the country’s economic competitiveness.”
The report provides recommendations designed to strengthen Tunisia’s readiness for renewable energy deployment and increase the role of the private sector in achieving national energy goals following the introduction of the National Energy Transition Strategy.
Francesco La Camera, IRENA director-general says the report complements the country’s national energy transition strategy by offering recommendations to create a robust energy system, support growth, create new jobs and enhance human health and welfare.
“Central to those recommendations is the need to stimulate the flow of low-carbon capital within the country through measures focused on capacity building, simplifying the regulatory environment and broadening the mandate of the national energy transition funds,” he said.
Best practices needed to diversify the renewables energy mix in Tunisia
The report identifies best practices, policies and enabling financial regulations that will support their ambition to diversify its energy mix through increased energy efficiency and accelerated renewable energy development.
The assessment found the new legal framework and various measures adopted by Tunisia in the last two years have been effective in promoting renewable energy in the country. However, the report does reveal various barriers to renewable energy deployment and provides eight key actions to overcome them. These are:
- Create a long-term energy plan to address system constraints and enable variable renewable energy integration;
- Improve renewables resource assessment as more detailed data is essential to identify cost-effective zones with high renewable energy potential;
- Simplify procurement procedures for power grid development to ensure alignment between renewable generation development a grid infrastructure reinforcement;
- Clarify the roles of associated institutions and strengthen their human resources by creating a consolidated platform for all renewable energy stakeholders in the country;
- Establish an independent electricity power authority to help ensure compliance of regulation and promote a transparent and fair competitive environment for private producers;
- Operationalise the Energy Transition Fund by mobilising funds from the public and private sector as well as international finance institutions;
- Create a dedicated financing mechanism for solar water pumping and encourage farmers to use it as a replacement for diesel pumps;
- Improve access to finance for farmers and SME enterprises by involving local banks in the development of renewable energy applications.
The report also identifies actors who could support these actions and highlights the need for bilateral and multilateral engagement to carry out the actions identified for deployment of renewables.
Read the full Renewables Readiness Assessment Report: Tunisia online.