Tunisia Renewable Energy Market Size & Share Analysis - Growth Trends And Forecast (2025 - 2030)

Tunisia Renewable Energy Market Trends and Insights

Utility-scale Solar PV Auction Roll-outs 2024-2026

Systematic auctions covering 1,700 MW of new capacity guarantee 20- to 30-year PPAs with sovereign backing, enabling projects such as Qair’s 298 MW plant and Voltalia’s 130 MW facility in Gafsa at tariffs below USD 0.04/kWh.^{(2)PV Tech Editorial, “Qair wins 298 MW solar PPA in Tunisia,” pv-tech.org} Annual output from awarded capacity is expected to reach 1,000 GWh, avoiding 250,000 t of natural-gas consumption worth USD 125 million and placing the Tunisia renewable energy market on a firm near-term growth path.^{(3)Zawya Staff, “Tunisia approves 1.7 GW of renewable tenders,” zawya.com} Irradiation surpassing 2,000 kWh/m² in Tozeur and Sidi Bouzid drives capacity factors close to 25%, yet evacuation hinges on transmission upgrades co-financed by the EUR 113 million Siemens-led smart-grid program.

Lower LCOE for Hybrid (PV + Storage) Plants

Hybrid solar-plus-storage systems now operate at levelized costs below USD 0.06/kWh in high-resource areas, making them cheaper than gas-fired peaking turbines while supplying evening demand peaks. Lithium-ion battery prices declined by roughly 15% in 2024, and developers embed 2- to 4-hour storage to lift capacity factors above 40% and capture premium dispatch payments. Industrial estates around Tunis, Sfax, and Gabès have adopted the model to secure predictable electricity costs, spurring a secondary market for behind-the-meter energy management services.

EU-Africa HVDC Interconnection Incentives

The 600 MW ELMED submarine link, backed by EUR 268 million in concessional financing, will establish a physical export route to Europe and alter domestic merit-order dynamics. Once operational, Tunisian generators can tap higher Northern-Mediterranean wholesale prices, improving returns on large-scale solar and wind farms and reinforcing investor appetite for the Tunisia renewable energy market.

Green-hydrogen Export MoUs with EU Utilities

MoUs between ACWA Power, TotalEnergies, and European offtakers target 600,000 t of green hydrogen per year in the first phases, implying up to 12 GW of new renewable capacity dedicated to electrolysis by 2035. CSP plants with molten-salt storage gain preference because they deliver round-the-clock electricity to electrolyzers, reinforcing technology diversification.

Fiscal Stress at State Utility STEG

STEG’s debt reached TND 4 billion (≈ approximately USD 1.32 billion) in 2024, driving deferred grid upgrades and raising doubts about the bankability of the PPA. Subsidies consumed 5.3% of GDP in 2022, and multilateral guarantees, such as MIGA’s USD 23.5 million cover for the 120 MW Kairouan plant, have become essential. Recapitalization or subsidy reform is needed to restore credit and lower WACC.

Grid Congestion in Coastal Governorates

With 70% of demand on the coast and the best resources inland, transmission shortfalls hinder the commissioning of projects. Studies show that integrating 20% variable renewables requires a 5-8% increase in reserve capacity, yet STEG’s roadmap remains unfunded. Developers increasingly accept lower-irradiance sites near existing substations to sidestep delays, shaving IRRs by up to 100 basis points.

Segment Analysis

By Technology: Solar Dominance Meets Wind Acceleration

Solar held 71.3% of the Tunisia renewable energy market in 2024, anchored by auctions that delivered the lowest tariff globally at 2.9 euro cents per kWh. Utility-scale wins totaling 498 MW in January 2025 keep solar's pipeline robust, and the Tunisia renewable energy market size for solar is forecast to exceed 2.6 GW by 2030. Yet wind's 36.2% CAGR will lift its share from 28.7% to nearly 35%, propelled by 600 MW of tenders and a 75 MW Chenini farm breaking ground in 2025.^{(4)Energy Capital & Power, “Chenini Wind Farm Breaks Ground,” energycapitalpower.com} Floating offshore feasibility studies in the Gulf of Gabès hint at a future diversification path.

Solar's mature developer ecosystem, including Scatec, Voltalia, and Qair, benefits from pre-cleared land, rapid permitting, and proven O&M track records, while TuNur's 4.5 GW CSP export concept remains stalled due to the lack of Italian offtake. Wind advances face land-use complexity; yet, an eventual fast-track permitting regime could cut lead times by a year and support Tunisia's gains in renewable energy market share for wind equipment suppliers. Hybrid PV-plus-storage projects, now in the design stage, will enhance capacity factors and grid stability, reinforcing solar's lead while enabling wind to supply round-the-clock blends that appeal to future hydrogen electrolyzers.

Note: Segment shares of all individual segments available upon report purchase

By End-User: Utility Dominance With C&I and Residential Scaling

Utilities controlled 78.6% of installations in 2024 and are projected to sustain a 27.9% CAGR, reflecting STEG’s central dispatch and 20-25 year PPAs that lock in risk-adjusted returns for IPPs. The Tunisian renewable energy market size attributable to utilities could reach 3 GW by 2030, as the 1,700 MW December 2024 program is implemented. The C&I segment has 381 MW authorized but only 30 MW commissioned, a gap that TEREG aims to narrow by offering ten-year credit at 5-6% interest, thereby lifting IRRs and accelerating rooftop adoption. Large cement and phosphate processors are installing captive plants to buffer tariff hikes and curtailment risk.

Residential growth stems from the PROSOL Elec scheme, which financed 315 MW across 90,000 homes and secured TND 370 million (≈ approximately USD 121 million) for rebates in 2024-2026. New low-income pilots in Tozeur will showcase agrivoltaic-linked rural electrification. If net-metering credits fall below retail tariffs, middle-income adoption could slow, underscoring the need for a clear, long-term tariff policy to maintain the momentum in the residential renewable energy market share in Tunisia.

Note: Segment shares of all individual segments available upon report purchase

Geography Analysis

Southern governorates, such as Gafsa, Tozeur, and Sidi Bouzid, already account for more than 55% of operational solar capacity, taking advantage of DNI levels above 2,000 kWh/m² and land prices that are one-third of those in coastal zones. Voltalia’s 130 MW Gafsa plant and Scatec’s 120 MW Tozeur facility typify the region’s large-scale profile, but both depend on 400 kV lines that route power northwards, underscoring the transmission imperative.

In the north, Sidi Daoud’s 53.6 MW wind farm achieves capacity factors exceeding 25% and supplies power directly into the Tunis bulk supply point; however, terrain limitations curb further expansion. Offshore wind prospects in the Gulf of Hammamet remain exploratory, pending bathymetry studies and clarity on offtake. Central zones, such as Kairouan and Kasserine, are emerging as second-tier solar hubs. China Energy Engineering Group began constructing a 100 MW plant in Kairouan in 2024, highlighting the spread of investment beyond the traditional southern regions.

Coastal governorates face chronic grid congestion, where load density is highest. Smart-grid automation and reactive-power compensation will relieve some pressure, but physical reinforcement of east-west corridors is indispensable. The 600 MW ELMED interconnector, which lands at Cap Bon on the northeast coast, will create new nodal pricing dynamics once exports commence. Interior agricultural areas are testing agrivoltaic arrays that reduce irrigation demand and align with rural development goals.