algeria power market outlook to 2025, update 2015

19 Pages·2015·1.08 MB·English

REFERENCE CODE GDPE0796ICR | PUBLICATION DATE JULY 2015

ALGERIA POWER MARKET OUTLOOK TO 2025,

UPDATE 2015 – MARKET TRENDS, REGULATIONS,

AND COMPETITIVE LANDSCAPE
ALGERIA POWER MARKET OUTLOOK TO 2025, UPDATE 2015 –

MARKET TRENDS, REGULATIONS, AND COMPETITIVE LANDSCAPE
Executive Summary
Algeria’s Power Sector Outlook Mirroring the increase in consumption, annual
power generation grew at a CAGR of XX%
Algeria is very rich in oil and natural gas but has no
between 2000 and 2014. Most of the increase was
coal. The economy is heavily dependent on the
contributed by thermal power, which dominates
hydrocarbon sector, which brings in XX% of
power generation.
national revenue, XX% of Gross Domestic Product
(GDP), and XX% of export revenue. Algeria ranks Power Market, Algeria, Annual Power Generation
and Consumption (TWh), 2000–2014
XX in the world in terms of natural gas reserves
and XX in terms of oil reserves.
d
n
a
n
The power sector is expanding. Aided by a growth o
ptih)
mW
in industry and an increasing population, power nsun (T
oo
cRoantesu (mCAptGioRn) gorfe wX Xa%t ab eCtowmeepno u2n0d0 0A nannuda 2l 0G1r4o,w aths al power cgenerati
u
n
shown in the following figure. n
A
Power Market, Algeria, Gross Domestic Product
($bn) and Annual Power Consumption (TWh), 2000– 2000 2007 2014
2014 Annual power consumption Annual power generation
Source: GlobalData, Power Database [Accessed on June 10, 2015]
h)
W
T
n ( Due to the rich reserves of fossil fuels, the power
o
n) pti
b m
DP ($ onsu sector is dominated by gas- and oil-based power
G c plants. In 2014, gas-based power plants
er
w
po contributed XX% of installed capacity.
al
u
n
n
A
0 1 2 3 4 5 6 7 8 9 0 1 2 3 4
0 0 0 0 0 0 0 0 0 0 1 1 1 1 1
0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
2 2 2 2 2 2 2 2 2 2 2 2 2 2 2
GDP (constant prices) Annual power consumption

Source: GlobalData; IMF, 2015
TWh: Terawatt hour

Algeria Power Market Outlook to 2025, Update 2015 – Market Trends, Regulations, and Competitive Landscape
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ALGERIA POWER MARKET OUTLOOK TO 2025, UPDATE 2015 –

MARKET TRENDS, REGULATIONS, AND COMPETITIVE LANDSCAPE
Table of Contents
1 Table of Contents
1 Table of Contents ....................................................................................................................... 4
1.1 List of Tables ...................................................................................................................... 7
1.2 List of Figures ..................................................................................................................... 8
2 Introduction ................................................................................................................................. 9
2.1 GlobalData Report Guidance ............................................................................................ 10
3 Algeria Power Market, Snapshot ............................................................................................... 11
3.1 Macro-economic Factors ................................................................................................... 11
3.2 Supply Security ................................................................................................................. 13
3.3 Opportunities .................................................................................................................... 14
3.4 Challenges ........................................................................................................................ 15
4 Algeria, Power Market, Market Analysis .................................................................................... 16
4.1 Algeria, Power Market, Market Structure ........................................................................... 16
4.2 Algeria, Power Market, Key Market Players ...................................................................... 16
4.3 Algeria, Power Market, Financial Deals ............................................................................. 16
4.3.1 Deal Value and Volume Analysis, 2004 to May 2015 .................................................... 16
4.4 Algeria, Power Market, Demand Structure ........................................................................ 19
4.4.1 Power Consumption by Sector, 2014 ............................................................................ 21
5 Algeria, Power Market, Regulatory Scenario ............................................................................. 22
5.1 Power Sector Reforms ...................................................................................................... 22
5.2 Key Power Sector Regulations .......................................................................................... 23
5.3 Renewable Energy Policy ................................................................................................. 23

Algeria Power Market Outlook to 2025, Update 2015 – Market Trends, Regulations, and Competitive Landscape
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ALGERIA POWER MARKET OUTLOOK TO 2025, UPDATE 2015 –

MARKET TRENDS, REGULATIONS, AND COMPETITIVE LANDSCAPE
Table of Contents
5.4 Algeria, Power Market, Foreign Investment Laws and Regulations ................................... 25
6 Algeria, Power Market, Capacity and Generation Overview ...................................................... 26
6.1 Algeria, Power Market, Cumulative Installed Capacity, 2000–2025 ................................... 26
6.1.1 Installed Capacity by Fuel Type, 2014 ........................................................................... 26
6.1.2 Cumulative Installed Capacity and Annual Generation, 2000–2025 .............................. 27
6.1.3 Cumulative Installed Thermal Power Capacity and Annual Thermal Power Generation,
2000–2025 ................................................................................................................... 30
6.1.4 Cumulative Installed Hydropower Capacity and Annual Hydropower Generation, 2000–
2025 ............................................................................................................................. 34
6.1.5 Cumulative Installed Nuclear Power Capacity and Annual Nuclear Generation, 2000–
2025 ............................................................................................................................. 37
6.1.6 Cumulative Installed Renewable Power Capacity and Annual Renewable Power
Generation, 2000–2025 ................................................................................................ 37
7 Algeria, Power Market, Transmission and Distribution Overview .............................................. 41
7.1 Algeria, Power Market, Transmission Network Overview .................................................. 41
7.2 Algeria, Power Market, Distribution Network Overview ...................................................... 42
7.3 Algeria, Power Market, Grid Interconnection ..................................................................... 43
7.3.1 Interconnection with Tunisia .......................................................................................... 43
7.3.2 Interconnection with Morocco ........................................................................................ 44
7.3.3 Interconnection with Europe .......................................................................................... 44
7.3.4 Electricity Import and Export Trends, 2000–2014 .......................................................... 44
7.4 Algeria, Power Market, Electricity Trading ......................................................................... 46
8 Algeria, Power Market, Competitive Landscape: Snapshot of Leading Power Generating
Companies ............................................................................................................................... 47

Algeria Power Market Outlook to 2025, Update 2015 – Market Trends, Regulations, and Competitive Landscape
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ALGERIA POWER MARKET OUTLOOK TO 2025, UPDATE 2015 –

MARKET TRENDS, REGULATIONS, AND COMPETITIVE LANDSCAPE
Table of Contents
8.1 Key Company in the Algerian Power Market: Sonelgaz Spa ............................................. 47
8.1.1 Sonelgaz Spa, Company Overview ............................................................................... 47
8.1.2 Sonelgaz Spa, Business Description ............................................................................. 47
8.1.3 Sonelgaz Spa, SWOT Analysis ..................................................................................... 49
9 Appendix................................................................................................................................... 53
9.1 Market Definitions ............................................................................................................. 53
9.1.1 Power ............................................................................................................................ 53
9.1.2 Installed Capacity .......................................................................................................... 53
9.1.3 Electricity Generation .................................................................................................... 53
9.1.4 Electricity Consumption ................................................................................................. 53
9.1.5 Thermal Power Plant ..................................................................................................... 53
9.1.6 Hydropower Plant .......................................................................................................... 53
9.1.7 Nuclear Power............................................................................................................... 53
9.1.8 Renewable Energy Resources ...................................................................................... 54
9.2 Abbreviations .................................................................................................................... 55
9.3 Bibliography ...................................................................................................................... 56
9.4 GlobalData’s Methodology ................................................................................................ 57
9.4.1 Coverage ...................................................................................................................... 57
9.4.2 Secondary Research and Analysis ................................................................................ 57
9.4.3 Primary Research and Analysis..................................................................................... 58
9.5 Disclaimer ......................................................................................................................... 59

Algeria Power Market Outlook to 2025, Update 2015 – Market Trends, Regulations, and Competitive Landscape
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ALGERIA POWER MARKET OUTLOOK TO 2025, UPDATE 2015 –

MARKET TRENDS, REGULATIONS, AND COMPETITIVE LANDSCAPE
Table of Contents
1.1 List of Tables
Table 1: Power Market, Algeria, Gross Domestic Product ($bn), Population (million), and Annual Power
Consumption (TWh), 2000–2020 ................................................................................................. 13
Table 2: Power Market, Algeria, Completed Deals, 2004 to December 2014 ............................................. 17
Table 3: Power Market, Algeria, Annual Power Consumption (TWh), 2000–2025 ...................................... 20
Table 4: Power Market, Algeria, Power Consumption by Sector (%), 2014 ................................................ 21
Table 5: Power Market, Algeria, Wind Energy Feed-in Tariffs, 2014 .......................................................... 24
Table 6: Power Market, Algeria, Solar PV Feed-in Tariffs, 2014................................................................. 25
Table 7: Power Market, Algeria, Cumulative Installed Capacity by Fuel Type (%), 2014 ............................ 26
Table 8: Power Market, Algeria, Cumulative Installed Capacity (GW) and Annual Power Generation (TWh),
2000–2025 .................................................................................................................................. 29
Table 9: Power Market, Algeria, Leading Thermal Power Plants, 2015 ...................................................... 31
Table 10: Power Market, Algeria, Cumulative Installed Thermal Power Capacity (GW) and Annual Thermal
Power Generation (TWh), 2000–2025 ......................................................................................... 33
Table 11: Power Market, Algeria, Leading Active Hydropower Plants, 2015................................................. 34
Table 12: Power Market, Algeria, Cumulative Installed Hydropower Capacity (GW) and Annual Hydropower
Generation (TWh), 2000–2025 .................................................................................................... 36
Table 13: Power Market, Algeria, Leading Renewable Power Plants, 2015 ................................................. 38
Table 14: Power Market, Algeria, Cumulative Installed Renewable Power Capacity (GW) and Annual
Renewable Power Generation (TWh), 2000–2025 ....................................................................... 40
Table 15: Power Market, Algeria, Transmission Line Length (Ckm), 2000–2020 .......................................... 41
Table 16: Power Market, Algeria, Distribution Line Length (Ckm), 2000–2020 ............................................. 43
Table 17: Power Market, Algeria, Imports and Exports (TWh), 2000–2014 .................................................. 46
Table 18: Power Market, Algeria, Sonelgaz Spa, SWOT Analysis, 2015 ...................................................... 50
Table 19: Abbreviation ................................................................................................................................ 55

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ALGERIA POWER MARKET OUTLOOK TO 2025, UPDATE 2015 –

MARKET TRENDS, REGULATIONS, AND COMPETITIVE LANDSCAPE
Table of Contents
1.2 List of Figures
Figure 1: Power Market, Algeria, Gross Domestic Product ($bn), Population (million), and Annual Power
Consumption (TWh), 2000–2020 ................................................................................................. 12
Figure 2: Power Market, Algeria, Annual Power Consumption (TWh), 2000–2025 ...................................... 19
Figure 3: Power Market, Algeria, Power Consumption by Sector (%), 2014 ................................................ 21
Figure 4: Power Market, Algeria, Cumulative Installed Capacity by Fuel Type (%), 2014 ............................ 26
Figure 5: Power Market, Algeria, Cumulative Installed Capacity (GW) and Annual Power Generation (TWh),
2000–2025 .................................................................................................................................. 28
Figure 6: Power Market, Algeria, Cumulative Installed Thermal Power Capacity (GW) and Annual Thermal
Power Generation (TWh), 2000–2025 ......................................................................................... 32
Figure 7: Power Market, Algeria, Cumulative Installed Hydropower Capacity (GW) and Annual Hydropower
Generation (TWh), 2000–2025 .................................................................................................... 35
Figure 8: Power Market, Algeria, Cumulative Installed Renewable Power Capacity (GW) and Annual
Renewable Power Generation (TWh), 2000–2025 ....................................................................... 39
Figure 9: Power Market, Algeria, Imports and Exports (TWh), 2000–2014 .................................................. 45

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ALGERIA POWER MARKET OUTLOOK TO 2025, UPDATE 2015 –
MARKET TRENDS, REGULATIONS, AND COMPE TITIVE LANDSCAPE
XXXXX
2 Introduction
Algeria is a developing economy and is largely dependent on hydrocarbons, which account for
approximately XX% of national revenue. The government has focused its efforts on diversifying the
economy by directing foreign and domestic investment to different infrastructure sectors. However,
these efforts have not always been beneficial for the country, which has faced high unemployment
and relatively low living standards. In 2002, Algeria entered into an Association Agreement with the
EU, which came into effect in 2005. In 2009, it adopted the complementary finance law, according
to which new restrictions were imposed on foreign investment, import companies, and domestic
consumer credit. According to this law, Algeria’s partnerships in new foreign investments and
foreign import companies were mandated at a minimum of XX% and XX%, respectively. The law
also stated that import payments would be made through letters of credit issued by banks.
In 2014, the industrial sector contributed an estimated XX% share of Gross Domestic Product
(GDP), followed by the services sector (XX%) and the agriculture sector (XX%). Hydrocarbons
contributed more than XX% of export earnings. Algeria had the XX largest natural gas reserves in
the world and was the sixth-largest gas exporter. It also ranked XX in oil reserves (CIA, 2015).
Leveling gas production and continuing domestic energy subsidies are concerns for the
government.
The Electricity and Gas Regulation Commission (Commission de Régulation de l'Electricité et du
Gaz, CREG) is the primary energy regulatory authority and is responsible for supervising and
formulating policies for the power sector. Sonelgaz is the only government-owned company
operating in the power sector, and gas is the primary fuel used for power generation.
The ministry announced its renewable energy program in 2011, which aims to add XX Gigawatts
(GW) of renewable energy plants by 2030. Renewable energy is forecast to constitute XX% of
installed capacity by 2025.

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ALGERIA POWER MARKET OUTLOOK TO 2025, UPDATE 2015 –
MARKET TRENDS, REGULATIONS, AND COMPE TITIVE LANDSCAPE
XXXXX
2.1 GlobalData Report Guidance
 The executive summary captures key growth trends in Algeria’s power market.
 Chapter three provides a snapshot of the key parameters affecting Algeria’s power sector, as
well as key points about its power market.
 Chapter four provides analysis of Algeria’s power market.
 Chapter five details the regulatory scenario for the Algerian power market and the inward
foreign investment scenario.
 Chapter six provides information on the country’s cumulative installed capacity and annual
generation trends, both as a whole and according to individual generation source.
 Chapter seven describes the country’s power Transmission and Distribution (T&D)
infrastructure, and includes information on interconnections with neighboring countries. The
section also covers power imports and exports and upcoming grid-related projects.
Note: All 2014 market figures provided in the report are estimates, except where actual data are
available.

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ALGERIA POWER MARKET OUTLOOK TO 2 0 25, UPDATE 2015 –
MARKET TRENDS, REGULATIONS, AND COMPETITIVE LANDSCAPE

Snapshot
3 Algeria Power Market, Snapshot
3.1 Macro-economic Factors
Algeria ranked XX out of XX economies in terms of ease of doing business, in the 2015 World
Bank index. Its rank in the previous year was XX. Resolving insolvency was the only parameter in
which it ranked in the top XX. Access to credit and taxation issues are the most challenging
obstacles encountered when doing business in Algeria (World Bank, 2015).
In 2014, the GDP, at current prices, amounted to $XX billion. The GDP, at constant prices, grew at
a Compound Annual Growth Rate (CAGR) of XX% from 2000 to 2014. Due to its proximity to
Europe, its economy is highly integrated with the European economy. Algeria is one of the largest
producers of natural gas in Africa and is the largest supplier of gas to Europe. As such, it is
dependent on demand from West European countries to sustain its growth. The debt crisis in
Europe therefore affected the Algerian economy, as demand for exports slowed. With growth in
Europe expected to pick up from 2015, the Algerian economy is expected to follow suit.
In 2000, the population stood at XX million. It increased at a CAGR of XX% to XX million in 2014.
From 2015 to 2020, the population is expected to grow at a CAGR of XX% to XX million (IMF,
2015).
Power consumption amounted to XX Terawatt hours (TWh) in 2000 and increased at a CAGR of
XX% to XX TWh in 2014 due to growing residential demand and rising usage for industrial
production.

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