EBRD finance package to stabilise Tunisia’s electricity provider
Tunisia, Tunis: The European Bank for Reconstruction and Development (EBRD) is providing $361 M (€300 M) to support stability of Tunisia’s electricity provider.
Tunisia, Tunis: The European Bank for Reconstruction and Development (EBRD) is providing $361 M (€300 M) to support stability of Tunisia’s electricity provider.
The financing package is meant to support the stability of Tunisia’s energy sector during the COVID-19 pandemic in the medium term. It will allow Société Tunisienne de l’Electricité et du Gaz (STEG) to implement an ambitious corporate and climate reform roadmap that would anchor the shift towards a more sustainable and efficiently run company.
STEG is Tunisia’s state-owned national electricity and gas utility company. Established in 1962, it produces and distributes electricity and natural gas. STEG is also the sole off-taker of private renewable energy in the country.
According to the International Energy Agency, Tunisia mostly relies on gas imports (from Algeria) to meet its primary energy needs – almost 97 % of its electricity in 2016 came from gas. The country’s energy policy does emphasise renewable energy and wind power has strongly increased since 2014.
The EBRD is supporting the decarbonisation of Tunisia’s energy sector through the introduction of robust climate governance measures, policy engagement to support solar and wind programmes and strengthening the financial standing of STEG.
The financing package will be accompanied by a detailed roadmap for reform and energy sustainability, which includes a comprehensive package of technical cooperation and investment grants. The package consists of two facilities. The first is an immediate $121 M (€100 M) emergency stabilisation facility under the EBRD’s Vital Infrastructure Support Programme. The second facility of up to $120,4 M (€200 M) will help refinance STEG’s short and medium-term liabilities.
In addition, the European Union is providing an investment grant of up to $24.1 M (€20 M) to finance the implementation of an enterprise resource planning system, a necessary step towards the modernisation of STEG.
The Global Environment Facility (GEF) is providing a grant of up to $481,830 (€400,000) under the EBRD’s Environmental Technology Transfer programme, which focuses on promoting investments in wastewater treatment and recycling.
Source: ESI Africa