Algeria’s total solar power capacity is 448 MW.

• Algeria has set an ambitious target to significantly increase its reliance on clean energy by 2030, aiming to generate 22 gigawatts (GW) of renewable energy.
• Solar power is poised to play a dominant role in this transition, with a planned capacity of 13,500 megawatts (MW), accounting for approximately 62% of the country’s total clean energy output.
• Wind power will also contribute substantially, making up around 23% of the clean energy mix, as Algeria strives to reduce its carbon footprint and diversify its energy sources.

Natural Gas

67% of electricity generation is from Natural gas. So, as of June 2023, the average price of electricity in Algeria for households is 0.040 USD/kWh. For businesses, the price is 0.035 USD/kWh.

Coal

Algeria does not hold any reserves of coal and, as a result, produces no coal. Algeria consumes very small amounts of coal, averaging 28,000 short tons per year from 2012 to 2021.

Solar

According to Jones Day, the base tariffs for solar photovoltaic projects in Algeria range from 0.0944 USD/kWh to 0.1180 USD/kWh.

Wind

• The cost of wind power varies depending on the scale of the wind farm. For larger wind farms with a capacity exceeding 5 megawatts (MW), the price per kilowatt-hour (kWh) is approximately 0.0776 US dollars.
• Conversely, smaller wind farms with a capacity between 1 and 5 MW are subject to a higher price point, at around 0.0969 US dollars per kWh. This tiered pricing structure reflects the economies of scale associated with larger wind farm operations.

In Algeria, Natural gas and oil account for over 90% of the energy generated in the country, while the remaining 0.1% is clean energy. In Figure 03, all the percentages of various electricity generation sources are given for year 2021- 2022.

Exact number of hours is not mentioned in any data. But electricity access rates in Algeria are relatively high compared to some other African nations, with around 99% of the population having access to electricity as of 2019 (World Bank data).

Data is not available explicitly but:

• 15 solar PV plants across 12 provinces, with individual capacities ranging from 80 MW to 220 MW is in pipeline.
• Additionally, the Solar 1,000 MW Project includes the construction of five plants across five Algerian provinces, with capacities ranging from 50 MW to 300 MW each.

Algeria is slowly getting more solar panels on homes. The government wants this to happen because Algeria gets a lot of sun. However, it’s hard to know exactly how many homes have solar panels. Here’s what we do know:

• By September 2023, Algeria had 24 big solar power plants connected to the main power grid. They also had one big wind farm. Together, these can make 354.3 megawatts of power.
• In 2023, Algeria asked companies to build 15 new solar power plants. Each one will be able to make between 80 and 220 megawatts of power. They plan to start building these in 2024. .
• Algeria has the best chance in North Africa and the Middle East to use solar power. It could potentially make about 170 terawatt-hours of solar power each year. They started their first big solar power project in 2011. This power plant uses both solar power (25 megawatts) and natural gas (130 megawatts) to make electricity.

Current Market:

• Algeria is expanding its solar energy capabilities with the development of additional solar power plants, including the El Kheneg facility located in the Sahara Desert.
• This substantial plant boasts 240,000 solar panels and has a capacity of 60 megawatts, contributing approximately one-seventh of the required power for the Laghouat region.
• Furthermore, the government is promoting clean energy adoption by distributing solar kits to remote villages and nomadic communities in the Laghouat area.
• In another significant initiative, the newly constructed airport in Oran, Algeria’s second-largest city, is powered by solar energy. The airport’s roof is equipped with over 4,500 solar panels, enabling it to accommodate 3.5 million passengers annually while showcasing the country’s commitment to renewable energy.

Market Projection

• Algeria has set an ambitious renewable energy target of achieving 16 gigawatts (GW) of solar and other clean energy capacity by 2035.
• To advance this goal, the government initiated a request for proposals in 2019, inviting companies to develop various solar projects, including off-grid solar installations and hybrid systems combining solar power with diesel fuel.
• This endeavor is part of Algeria’s comprehensive Renewable Energy Development Program, which aims to reach a total clean energy capacity of 22,000 megawatts (MW) by 2030. This program underscores the country’s commitment to diversifying its energy mix and reducing its reliance on fossil fuels.

“Solar1000 MW”

• Algeria is implementing a comprehensive clean energy strategy, supported by government initiatives and legislative frameworks. A significant milestone was achieved in 2023 when Sonelgaz, the national electricity company, selected 41 companies to develop solar power projects as part of its “Solar 1000 MW” program.
• These projects will collectively generate 1000 megawatts of electricity. Shaems, the government-owned entity overseeing this initiative, anticipates that the first electricity will be produced by the end of 2023, or by early 2024 at the latest.
• The initial power output will come from a 30-megawatt solar park in Beni Ounif, Bechar area, which is a component of the larger Solar 1000 MW project.
• Notably, all electricity generated by these new solar farms will be sold exclusively to Sonelgaz for a period of 25 years, aligning with the company’s role as the primary distributor of electricity and natural gas in Algeria.

Forecasted On-Grid demand

Algeria’s 2022 plan for growing clean energy says the country will have 22 gigawatts of clean energy by 2030. Of this, 62% will come from solar panels and 23% will come from wind power. To reach this goal, Algeria needs to build 5000 megawatts of solar power by 2028.

Concentrated Solar Power (CSP) Projects

• Algeria is planning to develop several large-scale solar power plants in the southern regions of the country, leveraging the abundant sunlight in these areas.
• The plants will utilize Concentrated Solar Power (CSP) technology, which is particularly well-suited for high-irradiance locations.
• In 2022, Algeria announced plans to construct a CSP plant with a capacity of 1.5 gigawatts (GW), which could potentially become one of the largest CSP plants globally.
• This ambitious project underscores Algeria’s commitment to harnessing its significant solar resources to meet its growing energy demands and reduce its reliance on fossil fuels.
• By capitalizing on its favorable solar conditions, Algeria aims to become a leader in the adoption of CSP technology and a major player in the global renewable energy landscape.

• Average Salary: 9,603.06 USD/year
• Lowest Average Salary: 5,189.36 USD/year
• Highest Average Salary: 14,469.22 USD/year

As of May 16, 2024, Algeria’s population is 46,191,578. This is a 1.47% increase from 2023, when the population was 45,606,480.

While specific overhead costs are not explicitly mentioned. But, some of costs are as follows:

Material Cost

Algeria imports Silicon and Iron from Turkey and China. Explicit cost is not available for metals.

Tender cost

Algeria launched a 1 GW solar tender, which may conclude with prices ranging from approximately $0.036/kWh

Factory installation cost

Zergoun Green Energy recently inaugurated a 200 MW solar module factory in Ouargla, southern Algeria. The total investment in this factory was approximately $11.6 million, covering both the building and equipment costs.

Tarrif and taxes cost

1. Zero VAT for Domestic Solar Panels

From May 1, 2023, the zero VAT rate applies to the supply and installation of solar panels on or adjacent to immovable goods, including private dwellings. This marks a shift from the previous reduced rate, which applied only when the solar panels did not exceed two-thirds of the total value of the supply.

2. Reduced VAT Rate for Private Dwellings

Private dwellings in use for less than 10 years can benefit from a reduced VAT rate of 6% for the supply and installation of solar panels2.

Labor Cost

Solar installer take 9,603.06 USD/year for solar installation in Algeria

Here’s a summary of the energy infrastructure in Bangladesh:

Electricity Generation

• Natural gas and oil account for more than 90% of Algeria’s energy, while renewable energy sources make up about 3%.
• Algeria currently generates a relatively small amount of its electricity (e.g., three percent or 686 MW annually), from renewable sources, including solar (448 MW), hydro (228 MW), and wind (10 MW).

Transmission & Distribution

Algeria’s energy sector is managed by two state-owned entities: Sonatrach, responsible for hydrocarbon production and trading, and Sonelgaz, which oversees the distribution of electricity and natural gas. To enhance the country’s energy infrastructure, several key projects are underway, including:

• A 700 km project to reinforce electricity supply in southern Algeria
• A 1,300 km transmission line connecting the provinces of Ghardaia and Tamanrasset, near the border with Niger and Mali
• A 400 kV overhead line (OHL) between Ramdane Djamel and Berrahal

Notably, Algeria’s electricity production has experienced steady growth, increasing by 6% annually since 2012, with gas being the primary source of generation. Furthermore, the country’s gas exports have surged by 33% since 2020, largely due to the impact of the war in Ukraine on global energy markets.

Renewable Energy

• Algeria is home to some of the world’s highest solar irradiance levels, with the capacity to generate 1,850 to 2,100 kilowatts per hour and up to 3,500 hours per year in its desert regions.
• For wind, Algeria has a 1,300-kilometer Mediterranean coastline with wind speeds of more than eight meters per second, in addition to winds coming off the surface of the Sahel in the South.
• Algeria has 13 hydropower plants, mainly in the northern parts of the country. The country also has solar PV and onshore wind installations, including the Hassi-Rmel hybrid plant, which has 25 MW of concentrated solar power (CSP), and the 10.2 MW wind power plant in Kabertène, which has 12 wind turbines with a rated power of 850 KW each.

Energy Access

• According to Statista, 99.79% of Algeria’s population had access to electricity in 2021, which was the highest percentage during the observed period.
• However, MacroTrends reports that Algeria’s electricity access in 2022 was 0.00%, which is a 99.79% decline from 2021.

Energy exports

• Algeria needs to export its hydrocarbon resources to support its economy, so it must reconsider the role of renewables.
• Analysts predict that Algeria will need to forego hydrocarbon export revenues to supply domestic power demand by 2035 unless it adds significant renewable resources to its power generation mix.

• Algeria’s Renewable Energy Program (AREP) guarantees preferential feed-in tariffs for solar photovoltaic projects for 20 years, ranging from 0.0945 USD/kWh to 0.1179 USD/kW.
• The government also announced in February 2022 that companies bidding on solar energy tenders would not be subject to the 51/49 investment rule.
• The government does not offer specific incentives for clean energy investments, but it may take on fiscal responsibilities to ensure continued employment for workers.
• Algeria welcomes foreign investment, and it has revised a number of regulations to encourage it, including allowing foreign entities to own a majority stake. Investors must meet some local content requirements, including using equipment manufactured in Algeria, largely solar panel and assembly structures. There are factories producing solar panels in Boukherana industrial zone, and the province of Ouargla.

Electricity laws

In the early 2000s, institutional reforms brought about significant changes in the electricity and gas distribution sector in Algeria. They led to the promulgation of Law 02-01 of 5 February 2002 relating to electricity and gas distribution through pipelines, the main objectives of which were reorganize the national electricity and gas distribution market by recommending:

• A restructuring of the operator;
• The separation of electricity and gas activities;
• The opening up of electricity production and energy marketing activities to public and private investors in order to promote the emergence of benchmark competition;
• The modernization of the public service and the improvement of the performance of operators in the sector; and
• A consumer protection framework.

Algeria has several initiatives and investments to support solar panel production, including:

National Renewable Energy and Energy Efficiency Programme (PNEE)

Launched in 2011, this program aims to increase the percentage of renewable energy in Algeria’s energy mix. By 2030, Algeria plans to add 22 GW of renewable energy capacity, with solar energy accounting for 13.5 GW.

Incentives

The government offers incentives to attract private investment into the solar industry, including long-term power purchase agreements (PPAs), tax advantages, and simplified permitting procedures. In February 2022, the government announced that companies bidding on solar energy tenders would not be subject to the 51/49 investment rule.

New Ministry for Energy Transition and Renewable Energy

The government has created this new ministry to follow through with feasibility and rollout studies.

Infrastructure development

The government is upgrading the grid and building solar parks to support large-scale solar electricity. The Energy Ministry plans to build 4,000 megawatts of solar photovoltaic (PV) plants between 2020 and 2024.

Renewable energy capacity target

The government’s target is to reach 22,000 megawatts of renewable energy capacity by 2030, including 13,500 megawatts of PV energy. The country also aims to produce 27% of its electricity from renewable resources by 2035, mostly from solar power.

Algerian government’s updated renewable energy program

The Algerian government’s updated renewable energy program, announced in February 2015, targets a significant increase in renewable energy capacity by 2030, emphasizing solar and wind power. To incentivize investment, the government offers preferential feed-in tariffs through 20-year power purchase agreements (PPAs) with distribution grid operators. Producers, subject to eligibility criteria including regulatory approval and environmental assessments, can apply for these tariffs, which range 0.0945 USD/kWh to 0.1179 USD/kWh for solar photovoltaic projects and 0.0776 USD/kWh to 0.0969 USD/kWh for wind power projects. Funding for these subsidies is drawn from a National Fund for Renewable Energies and Cogeneration, supported by a 1 percent tax levy on the state’s oil revenues and other contributions, ensuring financial support for renewable energy projects in Algeria.

Power purchase agreements (PPAs)

In 2021, it initiated partnerships with countries like China, Germany, and the United States to bolster renewable energy development. Algeria launched a tender for a one-gigawatt solar energy project and is transitioning off-grid oil and gas facilities to solar power. State-owned companies like Sonatrach and Sonelgaz dominate the sector, with SHAEMS facilitating larger renewable energy projects. Subsidies and incentives include long-term power purchase agreements (PPAs) and a reverse tender process favoring companies offering the lowest prices. International companies already involved in Algeria’s renewable energy sector benefit from strategic government engagements and access to tenders.

Here are some notable solar power projects:

Current Solar Projects

1. Sonelgaz Algeria Solar PV Park

• Location: Adrar, Algeria
• Capacity: 233MW
• Commissioned: 2015
• Developers: Yingli Green Energy, Sinohydro, Shariket Kahraba oua Takat Moutadjadida, China Hydropower Engineering Consulting Group

2. Laghouat Solar PV Park

• Location: Laghouat, Algeria
• Capacity: 60MW
• Commissioned: 2016
• Developers: Yingli Green Energy, Sinohydro, Shariket Kahraba oua Takat Moutadjadida, China Hydropower Engineering Consulting Group
• Owner: Shariket Kahraba oua Takat Moutadjadida

3. Djelfa Solar PV Park

• Location: Djelfa, Algeria
• Capacity: 53MW
• Commissioned: 2016
• Developers: Yingli Green Energy, Sinohydro, Shariket Kahraba oua Takat Moutadjadida, China Hydropower Engineering Consulting Group
• Owner: Shariket Kahraba oua Takat Moutadjadida

4. Ouargla Solar PV Park

• Location: Ouargla, Algeria
• Capacity: 30MW
• Commissioned: 2015
• Developers: Yingli Green Energy, Sinohydro, Shariket Kahraba oua Takat Moutadjadida, China Hydropower Engineering Consulting Group
• Owner: Shariket Kahraba oua Takat Moutadjadida

5. Hauts Plateaux West Saida Solar PV Park

• Location: Saida, Algeria
• Capacity: 29.88MW
• Commissioned: 2016
• Developer: Shariket Kahraba oua Takat Moutadjadida

Notable solar projects in the country (Projected)

Algeria has two upcoming solar projects:

The 2 GW initiative

The 2 GW initiative launched in 2023, will include 15 solar plants with capacities ranging from 80 to 220 MW, located in 12 provinces including in Béchar, M’Sila, Bordj Bou Arreridj, Batna, Laghouat, Ghardaïa, Tiaret, El Oued, El Tarf, El M’Ghair, Biskra and Ouled Djellal.

The Solar 1,000MW Project

In 2022, Algeria launched the Solar 1,000MW Project, a significant renewable energy initiative comprising five solar power plants with capacities ranging from 50 to 300 megawatts (MW). These plants will be strategically located across five provinces in the wilayas (regions) of Laghouat, Ouargla, Tiaret, El Oued, and Béchar.

The project, valued at US$1.2 billion, is expected to be completed within a timeframe of 7 to 16 months. Notably, the first project, spanning 988.4 acres in the Algerian Sahara, is anticipated to be completed within 14 months. This ambitious initiative underscores Algeria’s commitment to expanding its renewable energy capacity and reducing its reliance on fossil fuels.

ZERGOUN GREEN ENERGY

• ZERGOUN GREEN ENERGY is a private Algerian company and one of the subsidiaries of ZERGOUN BROTHERS GROUP.
• ZGE aims to expand in the field of renewable energy, particularly in the production of PV modules through the operation of the largest highly automated factory in Africa, with a capacity of over 200 MW per year.
• This factory uses 100 famous European products and the latest technologies, including “bankable” glasses (double glazing) and highly efficient “Mono Perc” cells.
• Our modules can produce up to 405 Wp per module, which is the best compromise between production and temperature degradation available on the market.

SCET Algérie Energie

• SCET Algérie Energie is a company that specializes in solar system installations and is a leader in renewable energy and sensitive electrical system protection.
• The company was established in 1995 and serves customers in various economic sectors, including applications that are considered critical.
• SCET Algérie Energie is also one of the leaders in the renewable energy market in Algeria.

Shariket Kahraba wa Taket Moutadjadida, SKTM

• spa, a subsidiary of Sonelgaz holding, was established to address two primary concerns: effective management of remote power plants in Algeria’s southern regions, ensuring improved electricity supply for households and the economy, and promoting the extensive use of solar energy to combat energy uncertainties and global warming.
• SKTM significantly improved electricity supply in southern Algeria through enhanced isolated network management, acknowledged by public authorities and residents.
• SKTM’s creation was driven by the unique challenges of managing isolated networks in southern Algeria, including distance from production sites and fuel supply difficulties, necessitating local initiatives for breakdown recovery.
• The isolation also affects SKTM workers’ daily tasks and psychological well-being, requiring suitable socio-professional conditions.
• As SKTM nears its first anniversary, the company acknowledges the dedication of its workforce and Sonelgaz’s steadfast support during the startup phase, crucial for its success.