Tunisia to Receive $30 Million Loan for Energy Sector Reform
The Tunisian Company of Electricity and Gas (Steg) is set to receive a $30 million loan from the Clean Technology Fund (CTF), as part of a reform program aimed at improving the performance of the public company and accelerating the development of renewable energy.
Background
On July 14, 2026, the Assembly of People's Representatives (ARP) published a draft law approving the guarantee agreement signed between Tunisia and the World Bank on November 3, 2025. The World Bank is acting as the implementing entity for the fund.
Objectives of the Loan
This financing is part of a broader program to modernize the energy sector, with the goal of strengthening Steg's operational efficiency, improving its financial situation, and consolidating sector governance. The government justifies this reform due to the structural difficulties faced by the company, particularly given that Tunisia still produces over 95% of its electricity from natural gas, making it vulnerable to international energy price fluctuations.
Renewable Energy Development
The program also aims to accelerate the use of renewable energy by supporting investments in solar and wind projects. It aims to increase the production capacity developed by private producers to 1,000 MW, through power purchase agreements with Steg. The objective is to strengthen the integration of renewable energy into the national grid, gradually reduce dependence on fossil fuels, and limit greenhouse gas emissions.
Performance Improvement
In addition to developing production capacity, the funds will be used to improve Steg's technical and commercial performance, gradually restore its financial balance, and modernize the sector's governance mechanisms. This reform is part of the 2024-2028 program undertaken by the authorities to address the company's situation without resorting to increasing electricity tariffs.
Loan Terms
The proposed loan has favorable financial terms, with a repayment period of 30 years, including 8 years of grace, a fixed interest rate of 1.33%, and a commission of 0.18% on undisbursed amounts. Disbursements can be made until December 31, 2029, and the loan will be guaranteed by the Tunisian state.
Next Steps
Through this draft law, the government is seeking parliamentary approval to finalize this financing, considered a key lever to accelerate Steg's restructuring and support Tunisia's energy transition.
