Algerian diesel-solar tender concludes with lowest bid of 11 cents

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The Shariket Kahraba wa Taket Moutadjadida unit of Algerian state-owned power company Sonegalz has announced the winners of a tender for 50 MW of hybrid solar generation capacity launched in January.

Algerian solar energy analyst Moloud Bakli told pv magazine all five tendered diesel-PV projects – to be developed in off-grid areas in the south of the country – were allocated.

The lowest offer for electricity from the projects – DZD13.436/kWh ($0.11) – came from Etp Habbi Kouider for an 11 MW facility in Tindouf, near the borders with Mauritania, Morocco and the disputed territory of Western Sahara. The next lowest bid, of DZD13.652, was submitted by Animer Energie Spa for a 12 MW scheme in Bordj Badji Mokhtar in Adrar province, in the southwest.

A third lowest bid of DZD14.095/kWh was made by Group Sarl Cegl and Spa Etber for an 11 MW project in Talmine, also in Adrar Province, and DZD14.458 was bid by Honghai Algerie/Sarl Sinohydrofor a 9 MW project in the municipality of Guezzem, in Tamanrasset province, Algeria’s southernmost territory.

The highest bid – 15.513/kWh – was offered by Group Spa Solam Energy and Amc for a 7 MW project in Djanet, an oasis city in Illizi province in southeast Algeria.

High costs

The final prices were significantly higher than those seen in recent north African tenders in Tunisia and Egypt with Bakli blaming the high costs of civil engineering in the remote areas selected for the projects. “Usually civil engineering costs account for around 10% of a project cost, but in these areas these cost may rise to up to 30%,” he said. “And we should also take into account higher costs for logistics.”

The analyst added, there is a local content requirement element for the PV equipment used in the hybrid facilities.

“It is true that solar modules produced in Algeria are sold at prices that are 20% higher than those of imported modules but it must also be remembered that to imported modules, 30% custom duties are applied,” said Bakli. “I am really glad, however, that this tender was finalized despite the current difficult context in the country.”

Civil unrest continues in the nation after huge street protests in April forced president Abdelaziz Bouteflika to abandon his stated goal of running for re-election.

The solar-diesel tender, together with another 150 MW procurement exercise for large scale solar that is being held, is part of Algeria’s plan to install 22 GW of renewable energy generation capacity by 2030, including 13.6 GW of solar. The North African country has solar capacity of around 343 MW at present.