Algerian Energy Policy: Perspectives, Barriers, and Missed Opportunities

Abstract

Despite the uncertainties of the energy market impacted by the collapse of oil prices and a sharp increase in domestic energy consumption, Algeria continues to make huge efforts to bring energy access to its people. At the same time, the country is also witnessing a very slow start of the energy transition, which brings into question the energy‐intensive development model accused of contributing both to global warming and to the depletion of fossil resources in the medium and long term. Although quantified targets are set, the National Program for the Development of Renewable Energies (NPDRE) struggles to take off and is lagging behind. There is no doubt that the recent fall in oil prices will further complicate the achievement of this transition; still one may raise the question of whether other barriers to the NPDRE should not be removed. Admittedly, the Algerian State has set up an incentive mechanism based on feed‐in‐tariffs to boost the NPDRE, but this failed to attract potential investors. This paper seeks to analyze the reasons for these failures as well as other issues linked with the energy–water–food trilemma. There are plenty, but the heavily subsidized energy products appear to be the most disabling.

Measures to Promote Renewable Energy for Electricity Generation in Algeria

“…This is especially the case, as the electricity demand is expected to more than double by 2030 [45]. As stated in Haddoum et al [20], it becomes necessary to promote REs accompanied by energy efficiency measures, for which price signals are necessary. In short, the growth in electricity demand may be making it difficult to achieve the renewable targets set by the Algerian government, so greater effort, both in renewable promotion and energy efficiency, will be necessary if the proposed objectives are to be achieved.…”

“…However, these papers are outdated and do not include the policies and data of recent years, when the most important RE increases have occurred. Finally, it is also worth noting the recent study by Haddoum et al [20] which includes energy policy questions, but does not review the RE policy measures adopted in the country. Based on previous research, the present study focuses on giving a detailed review of the measures applied in Algeria, to promote the use of RE in the electricity sector, and on assessing the extent to which the objectives set in the programs, approved by the government, are being met.…”

Solar Energy and New Energy Technologies for Mediterranean Countries

“…Currently 97% of the country's electricity demand is met by burning natural gas . However, dramatic growth in energy consumption combined with the fall in production led to a nearly 31% drop in natural gas exports between 2015 and 2005 . These figures explain the urgency for Algeria to uptake utility‐scale PV generation, whose low cost and high reliability enable the production of electricity sold at a profit for $0.03/kWh and even less …”

“…[13] The country has more than doubled its energy consumption from 28 MTOE in year 2000 to 58 MTOE in 2015, while the GDP at constant prices increased by more than 70%. [14] The Algeria's economy in 2017 consumed about 78 TWh of electricity. The figure is forecasted to increase to 123-160 TWh a −1 by 2025.…”

“…[15] However, dramatic growth in energy consumption combined with the fall in production led to a nearly 31% drop in natural gas exports between 2015 and 2005. [14] These figures explain the urgency for Algeria to uptake utility-scale PV generation, whose low cost and high reliability enable the production of electricity sold at a profit for $0.03/kWh and even less. [16] From Morocco to Syria, the countries of the southern and eastern Mediterranean basin share exceptional insulation levels, which make them ideally suited for the deployment of utility-scale PV.…”