Tunisia Power Market - Growth, Trends, COVID-19 Impact, and Forecasts (2021 - 2026)

The Tunisian power market is expected to register a CAGR of 7.70%, reaching 10.5 GW installed capacity in 2026 from 6.3 GW in 2020. Factors, such as the increasing participation of private players in the market, are likely to drive the Tunisian power market. However, energy security challenges such as strong dependence on natural gas and imports are expected to have a negative impact on the Tunisian power market.

Key Highlights

• The conventional thermal power segment dominated the market in 2020 and is likely to dominate the market in the future as well. While more than 40% of the natural gas used for power generation is produced in the country, the rest of the 60% of gas is imported.
• The Tunisian government is making an effort to produce 30% of the total electricity from renewables by 2030. This is likely to create several opportunities for the market in the future.
• The increasing installation of renewable energy sources in the country is likely to drive the Tunisian power market during the forecast period. In 2020, the Société Tunisienne de l'Electricité et du Gaz (STEG) signed a partnership agreement with Qair for a pilot project for a floating photovoltaic solar farm of a capacity of 200kV, on the lake of Tunis.

Key Market Trends

Conventional Thermal Power to Dominate the Market

• Conventional thermal power is the power that is generated through various sources, such as coal, natural gas, and oil. As of 2020, conventional thermal power represented more than 93% of the country's installed power production capacity.
• Out of the various sources of generating conventional thermal power, the majority of energy came from natural gas. Natural gas contributed about 97% to the conventional thermal power electricity generation, producing 18,990 gigawatt-hours (GWh) of electricity, in 2020.
• Moreover, in 2021, the government of Tunisia (GOT) is also expected to launch a tender for the construction of at least one 470-550 MW combined-cycle power plant in Skhira (south Tunisia) as an IPP. Thus, this is further likely to add to the country’s conventional power generation capacity.
• Therefore, owing to the above-mentioned points, conventional thermal power generation is likely to dominate the Tunisian power market during the forecast period.

Increasing Participation of Private Players Expected to Drive the Market

• In 2019, the state power utility company, STEG, controlled about 91.5% of the country’s installed power production capacity and produced 81% of the total electricity in Tunisia. The remainder was produced by Tunisia’s only independent power producer (IPP), Carthage Power Company (CPC), which owned a 471-MW combined-cycle power plant. Although STEG has resisted private investment in the power sector, the Tunisia Parliament’s 2015 energy law encourages IPPs (Independent Power Producer) in the renewable energy sector and gas-fired power plants.
• Until July 2020, the government of Tunisia awarded 12 solar projects of 10 MW each, two solar projects of 50 MW each, two solar projects of 100 MW each, one solar project of 200 MW, and four wind projects of 30 MW each to the private players.
• In 2021, the GOT is expected to launch a tender for the construction of at least one of the two 470-550 MW combined-cycle power plants in Skhira (South Tunisia) as an IPP. Moreover, the government has plans to launch tenders for about 3.5 GW of renewable energy of about USD 3.5 billion by 2030, or approximately 350 MW per year, over the next ten years.
• Hence, the above points indicate that the increasing involvement of private players in the market is likely to drive the Tunisian power market over the forecast period.

Competitive Landscape

The Tunisia power market is consolidated. Some of the key players in this market include Ansaldo Energia, General Electric Company, Nur Energie, Seeraj Energy, and Societe Tunisienne de l'Electricite et du Gaz (STEG).

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• The market estimate (ME) sheet in Excel format
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