MIGA Provides $23.5 Million Guarantee For Tunisia’s First Privately Financed Solar Power Plant

Carbon, Energy, Solar

MIGA Provides $23.5 Million Guarantee For Tunisia’s First Privately Financed Solar Power Plant

The Multilateral Investment Guarantee Agency (MIGA) issues a $23.5 million guarantee to AMEA Power for the development of Tunisia’s first large-scale privately financed solar power plant, supporting the country’s renewable energy goals and reducing reliance on imported gas.

The Multilateral Investment Guarantee Agency (MIGA) of the World Bank Group has provided a $23.5 million guarantee to AMEA Power Ltd. for its investment in the Kairouan Solar Plant, SARL, in Tunisia. This guarantee covers risks including transfer restriction and currency inconvertibility, expropriation, war and civil disturbance, and breach of contract for a duration of 18 years. The project is also receiving financing from the International Finance Corporation (IFC) of the World Bank Group and the African Development Bank (AfDB).

The MIGA guarantee facilitates the development, financing, construction, operation, and maintenance of a 100 MW grid-connected solar photovoltaic power plant in Kairouan, Tunisia. Electricity generated from the project will be sold to the state-owned Société Tunisienne de l’Electricité et du Gaz (STEG) under a 20-year power purchase agreement. This project marks Tunisia’s first large-scale privately financed grid-connected solar independent power producer and supports the government’s target of increasing renewable energy to 35% of its energy mix by 2030.

“Our guarantees in middle-income countries will accelerate their green transition to a clean and sustainable energy future,” said Hiroshi Matano, MIGA Executive Vice President. “We are excited to collaborate with the private sector in Tunisia to significantly increase its share of renewable energy for a prosperous future.”

The project aims to meet Tunisia’s growing electricity demand, lower power generation costs, and support the country’s move towards self-sufficiency by utilizing domestic renewable energy sources. This shift will help STEG reduce its exposure to gas price volatility and exchange rate fluctuations, easing the fiscal burden on the government and restoring macro-stability. Additionally, the project aligns with the low-carbon and climate-resilient goals of the Paris Agreement, contributing to a reduction in greenhouse gas emissions.

“This is a significant milestone for AMEA Power, as the country’s first privately financed solar project, paving the way for a greener Tunisia,” said Hussain Al Nowais, Chairman of AMEA Power. “By taking advantage of its renewable energy resources and strategic location between North Africa and Europe, Tunisia can become a prime location for green energy and trade.”

Tunisia’s ambitious plan to boost renewable energy production aims to reduce its heavy reliance on imported gas, which poses a threat to energy security. The Kairouan Solar Project represents the first step towards achieving this goal and is expected to pave the way for further private investments in the sector.