Tunisia's Solar Energy Projects: Government Faces Scrutiny Over Dispute Resolution
A parliamentary hearing was held on Monday at the National Council of Regions and Districts, where Minister of Economy and Planning Samir Abdelhafidh and Secretary of State for Energy Transition Wael Chouchane addressed concerns over the dispute resolution mechanisms for Tunisia's large-scale solar energy projects.
The hearing comes after the Assembly of Representatives of the People (ARP) adopted five draft laws on concession agreements for solar power production in late April. The projects involve the El Khobna, Mezzouna (Sidi Bouzid), El Ksar (Gafsa), Segdoud (Gafsa), and Menzel Habib solar power plants in the Gabès governorate.
While there is a consensus on accelerating the transition to renewable energy, lawmakers expressed strong concerns over the contractual clauses linking the state to foreign investors and the possibility of international arbitration, which they deemed a high-risk procedure for public finances and national sovereignty.
Lawmakers argued for strengthening the role of the national judiciary in resolving disputes, to protect the state's interests against private partners, and called for the final approval of these projects to be accompanied by robust guarantees to prevent these massive investments from becoming a burden on public finances in the event of a dispute.
They also emphasized the importance of providing necessary guarantees to ensure the proper implementation of these projects and promote real and sustainable regional development.
In response to lawmakers' concerns, government officials clarified that the legal clauses of the project agreements prioritize the resolution of disputes through national jurisdictions and that international arbitration would only be considered in specific cases, within the framework of contractual commitments related to the financing of these projects.
Government officials also stated that Tunisia has the necessary competence and expertise to defend its interests in various instances.
Energy Transition: A Strategic Choice to Address Growing Energy Deficit
Government officials emphasized that these investments are part of a national strategy to increase the share of renewable energy in electricity production to at least 50% by 2035. They argued that the concession agreements, with a duration of 25 years, provide a stable legal framework to attract investors while protecting the state's interests.
Minister of Economy Samir Abdelhafidh stated that the STEG remains the central actor in this process, as all the electricity produced will be injected into its network, with no export allowed for the time being.
Regarding procedures at the end of the contractual periods, the minister clarified that the signed conventions provide clear mechanisms ensuring either the transfer of equipment to the state if they are exploitable or the obligation for the investor to remove them and return the site to its original state, which preserves the state's interests and ensures the sustainability of exploitation.
Secretary of State Wael Chouchane highlighted the importance of these projects in the face of the degradation of national primary energy resources, which have decreased from 8.3 million tonnes of oil equivalent (TOE) in 2010 to approximately 3.4 million TOE in 2025. With a stable consumption of 9.7 million TOE, Tunisia faces an energy deficit of 6.3 million TOE, representing a dependence rate of 65%. This imbalance has led to an energy trade deficit of 11,023 million dinars in 2025, while energy subsidies have exceeded 7,000 million dinars, he added.
Chouchane estimates that the transition to solar energy is a strategic choice to reduce dependence on natural gas and produce electricity at competitive costs (between 100 and 112 millimes per kWh).
