EBRD Considers €40 Million Loan For Solar And Battery Storage Project In Tunisia

The European Bank for Reconstruction and Development (EBRD) is considering a major financing package to support a new renewable energy project in Tunisia. The proposed funding includes a senior loan of up to €40 million to Société Tunisienne de l’Electricité et du Gaz (STEG), Tunisia’s national state-owned electricity and gas utility. The financing will help develop a solar photovoltaic power plant with integrated battery storage, marking an important step in the country’s clean energy transition.

The project involves the construction of a 50 MWac solar PV plant along with a 20 MWh battery energy storage system. It will be located in the El-Medina area of the Gabes governorate in southern Tunisia. In addition to building the solar facility and the battery storage system, the project also includes the installation of high-voltage transmission infrastructure required to connect the plant to the national electricity grid.

The total investment for the project is estimated at around €82 million. Along with the EBRD’s potential loan, the Clean Technology Fund is expected to provide an additional €20 million in senior debt to support the development. The combined financial support will help ensure the successful construction and operation of the project.

One of the most significant aspects of this project is the integration of a utility-scale battery energy storage system. Solar power generation depends on sunlight and can fluctuate during different times of the day or due to weather conditions. By including a 20 MWh battery system, the project will be able to store surplus electricity generated during periods of high solar production, particularly in the daytime. The stored energy can then be released later in the evening or during periods of high demand.

This capability helps improve grid stability and allows renewable energy to be used more efficiently. By smoothing out the fluctuations associated with solar power, the battery system will help the national grid manage electricity supply more reliably while increasing the share of renewable energy in the country’s energy mix.

The project also supports Tunisia’s broader efforts to reduce its dependence on imported fossil fuels, especially natural gas. Currently, the country relies heavily on gas imports for electricity generation, making it vulnerable to global fuel price volatility. Expanding solar power capacity will help improve energy security while also lowering greenhouse gas emissions.

According to estimates, the project could reduce carbon emissions by nearly 498,000 tonnes of carbon dioxide equivalent each year. The development aligns with Tunisia’s national energy strategy, which aims to generate 35 percent of the country’s electricity from renewable sources by 2030.

If approved, the EBRD’s support will provide both financial resources and technical expertise to help STEG integrate more renewable energy into the national grid. The initiative also reflects a growing regional trend toward cleaner energy systems and sustainable infrastructure development across North Africa.