South African municipalities have given the green light to procure electricity from IPPs. Image: 123rf.
The Algerian government is preparing the tender for independent electricity producers. The aim of this call for expressions of interest is to select companies that produce 1,000 MW of renewable energy.
The tender, which will start between June and July 2021, will be divided into 10 lots with 100 MW each, which are open to foreign investment.
In a decree published in the Official Gazette on April 29, 2021, the Algerian government authorized the Minister for Energy Transition and Renewable Energies, Chems Eddine Chitour, to manage and monitor the entire operation.
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When it comes to generating renewable energies, Algeria lags behind its Moroccan and Egyptian neighbors. But the country wants to diversify its electricity mix. This justifies the tender that Algiers is currently preparing.
The aim is to achieve a newly installed capacity of 1,000 MW. This electricity is generated from renewable sources, the largest of which in the North African country is solar power.
Conditions for foreign investors
The Algerian government is preparing to conclude a bankable power purchase agreement for the IPPs, which will be selected at the end of the process. However, these investors must meet certain requirements, such as the use of locally manufactured equipment in Algeria. These are mainly solar panels, mounting structures and electrical cables.
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There are already several factories in Algeria that manufacture solar energy systems. In the Boukherana industrial zone near Chelghoum El Aid (400 km from Algiers), the Algerian company Milltech has a factory that can supply 100 MW solar modules per year.
In the Wilaya of Ouargla, another factory will soon be producing 160 MWp solar modules per year. In June 2020, the Algerian company SPS (Système Panneaux Sandwiches) and Qi-Energy, a company based in Dubai, United Arab Emirates, founded a joint venture to manufacture assembly structures for the modules.
Local content optimization
The local procurement of building materials for renewable energy systems will lower the electricity purchase prices in Algeria. As part of the Algerian Renewable Energy Development and Energy Efficiency Development (PENREE) program, launched in 2012, the authorities anticipated an installed capacity of 20,000 MW of renewable energy, including 13,575 MW of capacity for solar energy and 5,000 MW for wind power by 2030.