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06/14/2024 | Press release | Distributed by Public on 06/14/2024 04:33

Team Europe commits €472 million to support the ELMED electricity project and its ecosystem

The official announcement took place during the Tunisia Investment Forum (TIF) on 12th and 13th June, hosted by the Foreign Investment Promotion Agency (FIPA) under the auspices of the Ministry of Economy and Planning (MEP) in partnership with the European Union Delegation in Tunisia. Team Europe affirms its dedication to sustainable development in the Mediterranean region by committing a total €472,6 million to the ELMED electricity interconnection project and its ecosystem.

In December 2022, the European Union approved a €307.6 million grant from the Connecting Europe Facility (CEF) for the ELMED project. The grant agreement was signed on 7th August 2023 by the European Climate, Infrastructure and Environment Executive Agency (CINEA), along with Italy's national electricity transmission grid operator, Rete Elettrica Nazionale (TERNA) and the Tunisian Company of Electricity and Gas (Société Tunisienne de l'Électricité et du Gaz, STEG). This funding is crucial for the planning and construction phases of ELMED.

In December 2023, the European Bank for Reconstruction and Development (EBRD), the European Investment Bank (EIB) and the German Development Bank (KfW)), signed loan agreements worth €125 million to finance essential infrastructure such as the underwater cable, under the lead of the EIB.

To ensure a smooth implementation of the ELMED project, the EU approved an additional €27 million grant in December 2023 under the Neighbourhood Investment Platform. This funding will reinforce critical infrastructure components in Tunisia, including three key elements:

  • Modernisation of the dispatch centre (€10 million of EU investment), implemented by KfW, which has made available to Tunisia the 13M EUR funding needed;
  • Technical supervision of design and construction of the ELMED project to support STEG implemented by the EIB with a €12 million grant of EU investment grant under the European Neighbourhood Platform;
  • Social and environmental studies for the Tunisian green corridor, to ensure regulatory convergence between Italian and Tunisian grids required for the effective operation of the interconnector, implemented by EBRD (€5 million EU grant).

During the Tunisia Investment Forum, the « Mémorandum d'entente sur un partenariat stratégique pour promouvoir et développer le potentiel de l'investissement dans les énergies renouvelables et assurer l'approvisionnement énergétique et stratégique » was also signed between Tunisia and the EU, confirming the European support for Tunisia's 35% renewable energy objective by 2030.

"The ELMED project contributes to strengthening energy cooperation between Tunisia and Italy, and more broadly to the integration of the North African and European electricity markets" According to Fatma Thabet Chiboub Minister of Industry, Mines and Energy.Marcus Cornaro, Head of the EU Delegation in Tunisia, declared: "Tunisia's solar energy potential is enormous. Tunisia's energy independence also goes through renewable energies. ELMED will enable stabilize the power grid on both sides of the Mediterranean, and export electricity when possible. This is a real transition opportunity for Tunisia, in terms of economy, employment and emissions reduction."

EIB Vice-President Ioannis Tsakiris said: "EIB's backing of ELMED along Team Europe partners is a powerful statement of our dedication to sustainable energy and economic cooperation across the Mediterranean. This project not only bridges geographies but also unites us in our commitment to a greener, more resilient future. We are proud to support this landmark interconnection that promises to empower communities in both Tunisia and Italy."

KfW Member of the Management Committee Dr. Andrea Hauser said: "The ELMED project represents a mutually beneficial collaboration between Tunisia and the EU. It will enhance energy security for both parties and facilitate the expansion of renewable energy markets on both sides of the Mediterranean.KfW is proud to continue its long-standing partnership with Tunisia in supporting the country's transition to renewable energies. We are honoured to be co-financing this historic project with our European partners on behalf of the German government."

EBRD Managing Director for the Southern and Eastern Mediterranean region, Dr. Heike Harmgart said: "We are proud to be part of the ELMED financing group, alongside European partners contributing to the energy transition of Tunisia. As a first electricity interconnector between Tunisia and Italy, we hope that this landmark project will open the way for further connections between North Africa and Europe, which would enhance the energy security and promote a sustainable energy transition on both shores of the Mediterranean."

For further information about the ELMED project, please visit: https://elmedproject.com/

About the Tunisia Investment Forum, please visit https://www.tunisiainvestmentforum.tn/