Tunisia’s Energy Transition Lags Behind: Experts Call for Urgent Reforms at SITE 2026

At the 4th International Energy Transition Salon (SITE 2026), a panel of experts delivered a stark assessment: Tunisia is facing a critical delay in the deployment of renewable energy. The country’s current renewable energy share stands at just 9.2%, falling significantly short of the 35% target set for 2030. This lag is exacerbated by a heavy reliance on natural gas from Algeria (over 70% of imports) and mounting pressure on public finances, exposing the economy to volatile international price fluctuations.

The Banking Sector: Ready Funds, Missing Projects

Tunisian banks hold dedicated funds for renewable energy, primarily established to leverage tax incentives (such as tax exemptions in eligible zones in the South and Central-West). These funds are well-capitalized, with banks required to deploy the liquidity within two years. However, they struggle to identify projects with sufficient long-term profitability. A key structural constraint is the limited ability to transform short-term deposits into medium/long-term loans, which are capped at 7–10 years. In contrast, renewable energy projects typically require longer horizons to achieve profitability.

Structural Barriers: Currency Risk and High Interest Rates

Currency risk remains a major structural obstacle. International lenders provide credits to banks in foreign currencies, which are then transferred to companies in Tunisian dinars. The former public hedging mechanism (the Currency Equalization Fund) has been replaced by market instruments (TCX), which are more expensive and less accessible, according to Ahmed Karam, an international finance expert and Chairman of the Board of TLF.

Karam proposes reactivating a hedging fund combined with international guarantees and the Tunisian Guarantee Fund, which can cover up to 75% of project costs. While prevailing interest rates (7–10%) make financing costly, the Energy Transition Fund, authorized by the 2026 Finance Law, allows for a 3-point interest rate subsidy, bringing the effective rate down to approximately 7%. Additionally, some lenders offer grants covering up to 10% of project costs.

Streamlining Guarantees and Advisory Services

Traditional guarantees (land, equipment, STEG contracts, and insurance) are not always sufficient, with the Guarantee Fund acting as a complement. However, indemnification procedures remain complex and slow, taking up to three years. Experts propose reforming this framework to automate refinancing and accelerate indemnification. In parallel, banks are developing free advisory services to help developers structure credible business plans.

The Role of International and Public Institutions

Amira Klibi, Energy Specialist at the World Bank, highlighted the institution’s commitment through a portfolio of approximately $1 billion (via BIRD, IFC, and MIGA). This funding supports grid reinforcement, the ELMED interconnection ($268.4 million), and the performance improvement of STEG (Société Tunisienne de l’Électricité et du Gaz).

Néjia Gharbi, General Director of the Caisse des Dépôts et de Consignation (CDC), emphasized the CDC’s role in mobilizing and directing financing toward strategic projects while de-risking investments.

Five Priority Reforms to Accelerate Progress

Panelists outlined five key recommendations to accelerate Tunisia’s energy transition:

1. Create a Land Agency for Renewable Energy: Modeled on the industrial land agency, this body would make available land already connected to the STEG grid.
2. Green Monetary Policy and Bank Credit: Impose environmental risk management rules on banks to align credit policies with sustainability goals.
3. Establish a Renewable Energy Regulatory Authority: This body would oversee, control, and supervise the future carbon market.
4. Develop a Voluntary Carbon Market: Supervised by the new regulatory authority and managed by the Tunis Stock Exchange (Bourse des Valeurs Mobilières de Tunis).
5. Implement a Public-Private Single Window: This mechanism would issue a “passport” bundling all benefits, including financing, subsidies, and tax incentives.

Conclusion: A Call for Public-Private Partnership

Banks are ready to play a larger role in financing the energy transition but require a reformed framework, including improved access to land, clear regulation, effective currency risk coverage, and simplified procedures. Experts unanimously agree that public-private partnerships are essential to accelerating investment and closing the gap between Tunisia’s current energy mix and its 2030 targets.