Amea Power, a renewable energy company based in Dubai, will develop a $86 million, 120 megawatt solar power facility in Tunisia to hasten the country’s transition to clean energy.
The project will be the “first large-scale, privately financed” solar project in Tunisia and one of the largest infrastructure public-private partnership projects in the country in more than a decade, according to a statement released on Tuesday by International Finance Corporation, a member of the World Bank Group.
IFC will provide up to $26 million in debt financing to Amea Power, consisting of $13 million in concessional financing through the Clean Technology Fund.
The African Development Bank will also provide up to $26 million in debt financing, of which $13 million will come from the Sustainable Energy Fund for Africa.
The package will support the project’s development, financing, construction, operation, and maintenance in the Tunisian governorate of Kairouan, according to IFC.
The Tunisian government ratified the contract for the project in March of 2018 as part of a renewable energy program outlined by the government in 2018.
Prime Minister Ahmed Hachani of Tunisia stated, “The government is committed to successfully completing the 120MW Kairouan PV Solar project, which represents a significant step forward in the country’s energy transition.”
The International Energy Agency stated on Tuesday that countries must triple the global installed renewable energy capacity to 11,000 gigawatts by 2030 in order to attain net zero carbon emissions by 2050.
To limit global warming to 1.5°C, the world must increase renewable energy spending from the $1.8 trillion expected in 2023 to $4.5 trillion per year by the beginning of the next decade, according to the IEA’s updated Net Zero Roadmap report.
The IFC stated that Tunisia, which has a goal of attaining 35% clean energy by 2030, is one of the most vulnerable countries in the region to climate change due to its reliance on climate-sensitive agriculture and high levels of urbanization prone to flooding.
The country’s excessive reliance on imported hydrocarbons to meet increasing electricity demand has jeopardized its energy security and exposed the sector to price and exchange rate fluctuations.
The Kairouan solar project seeks to leverage private financing to reduce reliance on imported fuel and gas-generated electricity, improve the competitiveness of the Tunisian power sector, and contribute to the restoration of macroeconomic stability, according to the IFC.
Hela Cheikhrouhou, IFC’s regional vice president for the Middle East, Central Asia, Turkey, Afghanistan, and Pakistan, stated that this initiative is a positive step towards Tunisia’s green transition.
“South-South investments such as this one highlight the importance of private sector stakeholders in the energy transition. This initiative is consistent with our strategy to facilitate South-South investments, including those from Gulf Cooperation Council nations to emerging markets.”
To date, IFC’s cross-border investments with enterprises based in the GCC have totaled $6 billion from IFC’s own account and $4.77 billion in mobilisation, financing 170 projects.
Additionally, it has supported Amea Power’s expansion throughout Africa and the Middle East.
In November of last year, IFC and other partners provided the company with a $770 million financing package to support solar and wind projects in Egypt that will generate more than 1 gigawatt of renewable energy capacity collectively.
“Despite the challenges the market has faced since the Covid pandemic, we are proud to deliver this project and honor our commitment to supporting Tunisia’s transition to clean energy,” said Hussain Al Nowais, chairman of Amea Power.
Amea Power is rapidly expanding its investments in wind, solar, energy storage, and green hydrogen across 20 countries, with a renewable energy pipeline of over six gigawatts.
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