Renewable Energy: Two Solar Power Projects to be Built in Tunisia
The project will cost more than $121 million and will be financed by Zitouna Bank, the first Islamic lending institution in North Africa
There is certainly no shortage of sunshine in Tunisia, and the North African country is announcing a strategic partnership agreement between the state and a private lending institution to finance two programs for “residential solar water heating and photovoltaic panel power generation.”
The two projects, named Prosol and Prosol Elec, will be financed by Zitouna Bank between 2024 and 2026, and their implementation will be entrusted to the Tunisian Electricity and Gas Company (STEG) and the National Energy Management Agency (ANME). Zitouna Bank is the first so-called “Islamic banking institution” in the entire North African region. The required financing for the implementation of both projects is estimated at 370 million Tunisian dinars ($121.6 million).
According to a STEG spokesperson, the Prosol Elec project involves the installation of Chinese solar panels with a total capacity of 300 megawatts of electricity for supplying 90,000 families, with more than 400,000 systems to be installed as part of the Prosol water heating program.
The strategic cooperation agreement between Tunisian government authorities and the Islamic Bank represents one of the first tangible results of the implementation of the “National Energy Transition Strategy,” the main objective of which is to accelerate the North African country’s transition to a sustainable future, “in line with the country’s participation in the global effort to address the risks of climate change by reducing carbon dioxide emissions by 45% by 2030.”
One of the strengths of the Strategy relates to the financing mechanism, which is mainly based on “financial support to Tunisian families in the form of grants provided by the Energy Transition Fund” controlled by the National Energy Management Agency or in the form of subsidized loans provided by Zitouna Bank. The strategy aims to increase the share of renewable sources in Tunisia’s total electricity generation from the current 5% to 35% over the next six years, ensuring a secure and affordable energy supply for all by 2035.
