Algeria adopts decree implementing tender for 4 GW of solar

The Algerian Government has adopted the decree for the implementation of a 4 GW solar energy tender. The decree, which was published in the Algerian official journal yesterday, was the necessary step to make the auction process progress, and to launch the invitation to bid (ITB) phase, which is set to be issued in the upcoming days, according to a statement provided to pv magazine by Malek Drif, an Algerian renewable energy project developer.

“The Algerian renewable energy sector”, said Drif to pv magazine, “has welcomed the final publication of the decree in the official journal. The decree responds to the needs of the sector’s professionals because it will support investments in the local emerging renewable energy industry.”

The decree confirms that the auction will include domestic content requirements, and that participation in the tender is conditional to the “implementation of an industrial project”, which means, in the case of solar projects, the construction of a PV equipment manufacturing facility.

In theory, the tender is open to all renewable energy projects, although the Algerian Government has made it clear in recent public announcements that all the allocated capacity will be for solar energy projects.

According to the decree, projects selected in the three phases of the tender must have an aggregate annual power production between 10 GWh and 20 GWh per year. Moreover, the decree establishes that an ad hoc committee will be set up to overview all auction procedures, which will be managed by the local state-owned power and gas utility Sonelgaz.

Meanwhile, the Algerian Minister of Energy Noureddine Boutarfa met with the general director of the French Development Agency (AdD), Rémy Rioux, to discuss the possibility of providing financing for the tender’s projects. According to local press agency APS, Boutarfa insisted on the necessity of creating a domestic solar industry. Furthermore, the minister said that other unspecified large international financial institutions have expressed their interest in the 4 GW auction. At the end of the past week, Boutarfa also met with Engie’s general director Isabelle Kocher, with whom he also discussed potential investments in the frame of the tender.

In previous weeks, doubts were raised by local renewable energy experts and entrepreneurs on the feasibility of the tender. Some critics have pointed out that local enterprises could be excluded from future projects and that the size of each phase, 1.35 GW, was too big to guarantee equal access to all market participants. Others, however, claimed that the new auction scheme was well designed and that it solved most of the issues created by the unapplied FIT scheme.

The 4 GW tender is expected to enable the construction of several large-scale PV plants in the region of Hautes Plaines (High Plains), which is located in the northern part of the country, and also in southern Algeria.