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On July 15, 2024, the European Bank for Reconstruction and Development (EBRD), alongside the European Union (EU) and the European Investment Bank (EIB), announced a €61.3 million financing package to launch a 100 MW solar photovoltaic plant in Tunisia’s Sidi Bouzid region. This initiative marks a critical move in Tunisia’s strategy to bolster energy security, diversify its power sources, and meet its target of generating 35% of electricity from renewables by 2030.
Developed by the Scatec-Aeolus joint venture through Scatec Khobna PV Power, a locally established special-purpose company, the solar facility is set to become one of Tunisia’s largest privately financed renewable energy projects. Upon completion, it will produce approximately 252 GWh of clean electricity annually, significantly contributing to the national grid while displacing fossil fuel-based generation.
The financing structure leverages innovative support mechanisms to mitigate investment risks. The EBRD’s loan is backed by a first-loss guarantee under the European Fund for Sustainable Development Plus (EFSD+), while the EIB’s involvement is supported through the Connectivity Component of the EFSD+ Open Architecture Guarantee Agreement. Additionally, the EU’s Neighbourhood Investment Platform provides €5.5 million in grants to fund transmission infrastructure, ensuring seamless grid integration. This comprehensive approach underscores the "Team Europe" collaboration, pooling resources from European institutions to drive sustainable infrastructure in partner nations.
Environmental benefits are a cornerstone of this project, with expected annual CO₂ reductions of around 107,000 tonnes over its lifespan. By cutting greenhouse gas emissions and reducing reliance on imported natural gas, Tunisia moves closer to its decarbonization commitments under international climate agreements. The solar plant also aligns with the EU-Tunisia memorandum of understanding on energy signed in June 2024, emphasizing shared goals for energy transition and security.
Beyond immediate impacts, the project catalyzes private-sector engagement in Tunisia’s renewable energy market. As a major privately funded development, it signals growing investor confidence and could attract further capital into the sector. This shift is vital for Tunisia’s economic resilience, fostering job creation and technological adoption in regions like Sidi Bouzid and Gabès.
A technical cooperation package, funded by the EBRD’s Shareholder Special Fund, will enhance local workforce skills in the energy sector. Programs will focus on training and development, addressing labor market needs while ensuring community benefits. In parallel, awareness campaigns in Khobna and Mezzouna will promote gender inclusivity and prevent workplace harassment, encouraging more women to participate in renewable energy careers.
Tunisia’s broader 1.7 GW renewable energy concession programme, launched in 2022, provides context for this project. It represents a strategic effort to expand solar and wind capacity, essential for meeting rising electricity demand sustainably. According to recent data from the International Energy Agency (IEA), Tunisia’s renewable energy growth has accelerated by 15% year-over-year since 2023, outpacing regional averages—a trend bolstered by investments like this EBRD-backed initiative.
Harry Boyd-Carpenter, EBRD’s Managing Director for Sustainable Infrastructure, highlighted the partnership’s role in delivering affordable, clean energy while strengthening Tunisia’s energy autonomy. He praised ongoing reforms in the energy sector, noting that such projects exemplify how international collaboration can accelerate sustainable transitions. EIB Vice-President Ioannis Tsakiris echoed this, describing the solar plant as a milestone in providing reliable and sustainable power through European solidarity.
The European Fund for Sustainable Development Plus (EFSD+), established in 2021 with a €39.8 billion guarantee capacity for 2021–2027, underpins this investment. As a pillar of the EU’s Global Gateway strategy, EFSD+ aims to mobilize public and private funds for climate and development projects worldwide. Tunisia’s inclusion as a beneficiary reflects its progress in aligning with global sustainability frameworks.
Over the past decade, the EBRD has invested over €3 billion in 90 projects across Tunisia, supporting nearly 2,000 small and medium-sized enterprises through EU-funded technical assistance. This new solar venture extends that legacy, reinforcing Tunisia’s path toward a cleaner, more resilient energy future. Looking ahead, analysts project that sustained investments could help Tunisia exceed its 2030 renewable targets, potentially reaching 40% clean energy penetration with continued international support.
