NAE Case Study: Tunisia, Low Cost Distribution Technology

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For rural electrification, Tunisia chose not to adopt the technical standards it had inherited from Europe, which included a distribution system suited to densely populated areas and heavy loads. Instead, a system based upon the North American model - known in Tunisia as MALT (Mise A La Terre) - was introduced in 1977. The national utility, STEG, continued to reduce distribution-system costs through further innovations.  These included the Single-Wire Earth-Return system (SWER), a variation on the MALT system, which was introduced in 1990.


Tunisia’s rural electrification program was launched in the mid-1970s, when about half of the population lived in rural areas and only 30,000 (6%) of the country’s rural households had electricity. In 2001, Tunisia became a net energy importer (after many years of surplus power generation) and  the gap between production and demand is growing every year.   Consequently, the current national energy strategy aims to generate 30% of energy from local renewable resources, and achieve a 30% reduction of the primary energy consumption, by 2030. The national installed electricity generation capacity was  4,800MW in 2014, with 94% provided by natural gas fired thermal power stations and the remaining 6% divided between hydroelectric power (62 MW) and wind (245 MW).  In 2012  Tunisia  achieved a 99.8% electrification rate (100% in urban areas and 97% in the countryside) compared to 95% in 2000.  This is despite the fact that Tunisia’s rural population is highly dispersed and isolated, with long distances between small groups of sometimes scattered houses. Consequently, in this year, Tunisia’s  Ministry of  Energy,  Mines  and  Renewable  Energies,  decided to  create  a  specific  law  to cover renewable energy project development. After extensive deliberation, in August 2016, the  government approved the application of this law, which finalized the legal  framework  for the development of renewable energy projects eagerly awaited by  foreign investors. There has also been a recent program to serve even the most remote areas with PV systems, and efforts  have been made on regulatory and policy frameworks to support renewable energy integration.  The elaboration  of the necessary Feed-in-Tariff is the next important step, especially for the deployment of investors' projects.


Concerned about the growing movement of people from rural to urban areas in the 1970s, the Government set the goal of providing electricity coverage for the whole country. At that time, half of the population lived in rual areas butonly 30,000 (6%) of the country’s rural households were electrified. Taking account of the potentially low levels of rural energy consumption, and high financial requirements, the Government recognised the need for a new, lower cost means of electricity distribution.  Rural electrification goals were incorporated into STEG's 5-year plan for 1977-81 (and subsequent plans), which included the objectives to expand the distribution system, and to convert relevant lines to the MALT system. By the end of 2000, 88% of rural households (nearly 95% percent of all households) had been electrified.

Legal Basis

Commitment to MALT distribution system was included in the Vth Development Plan (1977–1981) of STEG

Institutions, Roles and Responsibilities

Few entities manage energy deployment in Tunisia, thus shaping a simple and coherent market structure, but limiting the scope of IPPs. The three main stakeholders are the Tunisian Ministry of Energy, Mines, and Renewable Energy (MEMRE), the Tunisian company of Electricity and Gas (STEG), and the National Agency for Energy Conservation (ANME).  Their main areas of responsibility include:

  • MEMRE: research (including permits for companies); national energy security; renewables and efficiency policy; optimization of hydrocarbon production and market conditions; promotion of clean energy
  • STEG:  management of the production, transportation and the distribution of electricity and gas in Tunisia, including the use of diverse sources such as thermal, hydro and wind.  STEG holds the monopoly of transmission, distribution, and sale of electricity. The company also accounts for 79% of power generation.  STEG-ER is the renewable part of the STEG, working on wind, solar and cogeneration. (IPPs represent 17% of the total electricity generation, though their contribution  is limited  to  production  for either self-consumption or to sell  to STEG).
  • ANME:   under the supervision of MEMRE, to apply national  policies  regarding energy management  by  studying and  promoting energy efficiency,  renewable and energy  transition. ANME has two sections (renewable energy and energy efficiency)


The SWER system was introduced in 1990 and allowed an additional cost reduction of 26-30%, compared to single-phase MALT. This again represented the innovative application by STEG of existing low-cost technology. SWER was introduced with a number of precautions because of the potential risks of the returning current to humans and animals if lines were not carefully installed and monitored.  Consistent supply has been challenging, with regular notification of power outages and voltage fluctuations (leading to loss of refrigeration medicines in clinics and damage to appliances such as TVs).  There was also an apparent inability to establish good communication links with all customers. STEG follows rigorous commercial practices in its minimizing of non-technical losses, billing practices, payment collection, and debt reduction. The State, through its various programs, assumes the balance of investment costs not covered by STEG or beneficiaries. The State’s contribution rose up to 85% of total project connection costs in the latter stages, compared to 45% in the program’s early years.  Abuse is deterred by STEG’s policy on illegal connections, which includes frequent, regular monitoring and meter inspection campaigns. However, little monitoring of customer satisfaction with quality of service has been undertaken though customer service representatives were employed in branch offices to handle customer billing problems and complaints. An integrated billing software program has been set-up to closely follow each customer file through connection, cash payment, hook-up, and finally metering and billing of consumption. 

Impacts Achieved

From 1977-1981, 70,000 rural households were connected, and investment costs were fully recovered. During STEG's VIth Plan (1982–1986), 80,000 rural households were connected (savings from the new distribution system made it possible to connect an additional 10,000 households under the same budget, raising the rate of rural electrification to 28%).  In total, by 2001, over 600,000 households had been connected. By late 1996, the lines using SWER supplied 425 villages through 1,148 MV/LV substations.  Using local suppliers has not only reduced STEG's own costs, but has also encouraged the  growth of a national export industry.  In rural areas, fraud and meter tampering are minimal (one major reason is that rural customers have more respect the electricity utility than urban consumers). 

Lessons Learned

A supportive context was required for the national electrification programme, including:

  • National Commitment: continued Government support as part of a broader, integrated rural development program that has emphasized social equality (particularly gender equity)
  • Integrated Rural Development Context: regional planning processes and successive five-year plans, which have tightly incorporated rural electrification into broader rural development objectives
  • Effective Institutional Approach: key principles for success include well-defined, coordinated roles for all agencies concerned, and established procedures that ensure agency cooperation that is perceived as being fair.

For long-term sustainability, a rural electrification program must establish a system of tariffs and charges that are self-financing and do not depend on increasingly larger subsidies from State revenues. In this respect, Tunisia’s tariff policy has avoided many of the pitfalls encountered in other developing countries. STEG prices power close to its long-term marginal cost, and makes considerable efforts to keep rates in line with the cost of providing electricity. Despite the initial installation costs, which were covered by the Government (up to 85%) and by STEG, setting user tariffs that match the ongoing operational costs means that there are minimal ongoing demands from the State budget regarding electricity supply.


The electrification programme has undoubtedly been successful, with 99.5% of the population now connected to the main grid.  The identification and use of technology that was sufficient to meet the customer needs, but lower cost than implemented in countries that have greater power demand, provided a good means to achieve a programme with maximum cost-effectiveness.  This low-cost technology approach has met customer expectations, providing a tier 5 level service in terms of energy access, with few signs yet of problems from capacity constraints.  However, this potential future limitation should ideally be addressed at the outset of such a national electrification plan (to assess what is the expected level of long-term electricity demand and size the installations accordingly).  The programme involved investment of more than 450m  Tunisian Dinars (MTD) between 1977 and 2000, most of it provided by the national government. (The MTD/US$ exchange rate ranged from 0.43-1.37 over this time, so the investment was equivalent to ~US$400m).  This resulted in more than 600,000 rural connections made (7,700 with 50-100W solar PV systems) at an average cost of about US$670/household. By the end of 2000, 88 percent of rural households and nearly 95 percent of all households had been electrified. 

Overview of Other Country Case Studies

Bangladesh, IDCOL Solar Home SystemsBrazil, Luz para Todos (Light for All)NAE Case Study: Cambodia “Light Touch” RegulationCosta Rica, Distribution CooperativesEthiopia, Solar Market DevelopmentKenya, Off-Grid for Vision 2030Mali, Rural Electrification ProgrammeNepal, Rural Energy Development ProgrammePeru, Concession Model for Standalone SystemsPhilippines, Islanded Distribution by CooperativesRwanda, Sector-Wide Approach to PlanningSouth Africa, Integrated National ElectrificationTanzania, Mini-Grids Regulatory FrameworkTunisia, Low Cost Distribution TechnologyVietnam, Rapid Grid ExpansionNAE Case Studies Navigation Table.png]]



Authors: Mary Willcox, Dean Cooper


The Review was prepared by Mary Willcox and Dean Cooper of Practical Action Consulting working with Hadley Taylor, Silvia Cabriolu-Poddu and Christina Stuart of the EU Energy Initiative Partnership Dialogue Facility (EUEIPDF) and Michael Koeberlein and Caspar Priesemann of the Energising Development Programme (EnDev). It is based on a literature review, stakeholder consultations. The categorization framework in the review tool is based on the EUEI/PDF / Practical Action publication "Building Energy Access Markets - A Value Chain Analysis of Key Energy Market Systems".

A wider range of stakeholders were consulted during its preparation and we would particularly like to thank the following for their valuable contributions and insights: - Jeff Felten, AfDB - Marcus Wiemann and other members, ARE - Guilherme Collares Pereira, EdP - David Otieno Ochieng, EUEI-PDF - Silvia Luisa Escudero Santos Ascarza, EUEI-PDF - Nico Peterschmidt, Inensus - John Tkacik, REEEP - Khorommbi Bongwe, South Africa: Department of Energy - Rashid Ali Abdallah, African Union Commission - Nicola Bugatti, ECREEE - Getahun Moges Kifle, Ethiopian Energy Authority - Mario Merchan Andres, EUEI-PDF - Tatjana Walter-Breidenstein, EUEI-PDF - Rebecca Symington, Mlinda Foundation - Marcel Raats, RVO.NL - Nico Tyabji, Sunfunder -

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