Tunisia Solar IPPs

MIGA is proposing  a programmatic approach (hereafter referred to as, ‘the Tunisia Solar IPP Program or just ‘the Program’) to provide  guarantees to multiple Guarantee Holders (GHs) including Voltalia S.A. and other investors to be identified, to support their equity/quasi-equity/shareholder loan (EQS) investments in individual solar Independent Power Producers (IPPs) awarded under the Government of Tunisia’s (GoT’s) Solar Concession Program. The proposed tenor of guarantees to be issued is up to 20 years. Further information on the proposed MIGA guarantees is available in the Summary of Proposed Guarantee or Project Brief.  

GoT has embarked on an ambitious energy transition, recognizing the strategic importance of Renewable Energy (RE) for diversifying its generation mix, enhancing energy security, and meeting climate commitments. In May 2018, the GoT launched the first round of its Solar Concession Program (Round 1), tendering 500 MW of solar photovoltaic (PV) capacity under a competitive concession regime. Of the five projects awarded under the Round 1 Concession, three reached financial close. These three are all supported by Development Finance Institutions, and covered by MIGA guarantees for their EQS investments:

• The Kairouan project (100 MW), sponsored by AMEA Power, achieved financial close in 2023, with financing provided by the International Finance Corporation (IFC) and the African Development Bank (the Kairouan Project). MIGA guarantee was issued July 17, 2024 (see disclosed ESRS/ESAP). 

• The Tozeur (60 MW) and Sidi Bouzid 1 (60 MW) projects, sponsored by Scatec and Aelius, were financed by European Bank for Reconstruction and Development (EBRD) and Proparco and reached financial close in 2024. MIGA guarantees were issued August 1, 2024 (see disclosed ESRS/ESAP) 

The Kairouan project entered commercial operation in December 2025. Tozeur and Sidi Bouzid 1 projects are at the end of construction stage and are expected to begin operations by Q1 2026. 

Building on the lessons from Round 1 Concession, Tunisia launched a Round 2 Concession in December 2022, targeting the procurement of 1.1 GW of solar capacity through phased tenders between 2022 and 2026. Among the first batch of projects awarded under the Round 2 Concession is the Sidi Bouzid 2 project:

• The Sidi Bouzid 2 project (100 MW), sponsored by Scatec and Aelius is expected to be financed by EBRD and the European Investment Bank (EIB) and is currently at the pre-financial close stage. The project is also being considered for a MIGA guarantee (see disclosed ESRS/ESAP).

Under the Program, all IPPs awarded through GoT’s Solar Concession Program are eligible to be considered for a MIGA guarantee, up to an aggregate amount of US$ 300 million. As the specific IPPs to receive guarantees are not yet identified, this ESRS summarizes the risks and impacts inherent to the sector and country context based on MIGA’s experience underwriting the above mentioned four solar projects and review of the first solar energy project to be considered under the Program:

• The Menzel Habib project, sponsored by Voltalia, consists of the development, financing, construction, operation and maintenance of a 100 MW solar PV power plant in the Gabès governorate in Tunisia (Menzel or the Menzel Project). The project will consist of (i) a utility grade grid-connected PV array power system; (ii) a 200 m new Overhead Transmission Line (OHTL); and (iii) upgrade of an existing 145 km OHTL owned and operated Société Tunisienne de l'Electricité et du Gaz (Tunisian Company of Electricity and Gas – “STEG”) which is the offtaker of all of the solar IPPs in the Tunisia Solar Concession Program. The 145km OHTL will be upgraded from 150kV to 225 kV voltage capacity and the upgrade works consist only of changing isolator on the towers, as the existing cable is deemed adequate for a voltage of 225kV and additional power. The project will be established on a 200 hectare plot that belongs to a private owner, under one land title. The land, including the new OHTL footprint, is leased from one landowner under a willing lessee, willing lessor arrangement. The plot is uninhabited, free of any structures and was being used for herding activities by the owner. IFC and EBRD are expected to be co-lenders to the project. The project is still in the design stage and is expected to be completed within 18 months after the Engineering Procurement and Construction (“EPC”) contract anticipated to be in early 2026.(See IFC’s disclosed ESRS/ESAP).

Each project will be implemented through its own special-purpose vehicle (the Project Enterprise or PE) under a 20-year Power Purchase Agreement (PPA) (Round 1 Concession) or a 25-year PPA (Round 2 Concession). The PEs will sell all electricity to STEG, the off-taker.

For projects yet to be identified, E&S due diligence will be undertaken once they are identified and the ESRS will be updated to include the name, location and relevant E&S information of the new projects.  

All of the five projects reviewed (i.e. the four already considered for a MIGA guarantee and the one for initial consideration under the Program) are Category B according to MIGA’s Policy on Environmental and Social Sustainability (2013) with limited adverse E&S risks and/or impacts that are few in number, generally site-specific, largely reversible, and readily addressed through mitigation measures. However, considering the potential cumulative impacts, and given that future projects of the Program are yet to identified, it is possible that some may present significantly adverse risks and impacts, hence the overall Program is Category A. 

Key E&S issues typically associated with solar projects in Tunisia include land acquisition, biodiversity conservation, stakeholder engagement, water use, labor influx and worker accommodation, labor and working conditions, security management, community health and safety, and cumulative impacts. There may also be risks related to the supply chain and project-specific risks related to Gender Based Violence and Harassment (GBVH). All E&S risks will be assessed against MIGA’s PS and relevant WBG Environmental and Health and Safety (EHS) Guidelines. 

While all PSs are applicable to the Program, based on available current information, the Program will have impacts that must be managed in a manner consistent with the following PSs:

• PS1: Assessment and Management of Environmental and Social Risks and Impacts
• PS2: Labor and Working Conditions
• PS3: Resource Efficiency and Pollution Prevention
• PS4: Community Health, Safety and Security
• PS5: Land Acquisition and Involuntary Resettlement
• PS6: Biodiversity Conservation and Sustainable Management of Living Natural Resources
• PS 8: Cultural Heritage

PS 7 (Indigenous People) is not applicable (no communities present in the potential project areas that meet the PS 7 definition of Indigenous People)

In addition, the following WBG EHS Guidelines are applicable to the Program:

• General EHS Guidelines (2007)
• EHS Guidelines for Electricity Transmission and Distribution (2007)

For the 4 projects already considered by MIGA, the list of documents reviewed is provided in the relevant ESRSs. For the first project considered under the Program, MIGA relied on IFC’s due diligence, including site visits, and the information from their disclosed ESRS which details the list of reviewed documents. 

As IPPs are identified under the Program, MIGA will review the relevant E&S documents and undertake site visits as needed. Where IFC and other Development Finance Institutions are considering or have provided support, MIGA will leverage the available information to support its own E&S due diligence.

MIGA’s due diligence review considered the E&S risk inherent to solar IPPs in Tunisia. The sections below describe the anticipated E&S risks and impacts, and the management and mitigation measures that will be required to address these risks and impacts. E&S risks and impacts specific to IPPs will be considered as those projects are identified, and, if there any gaps between the proposed mitigation and MIGA’s requirements, corrective measures, intended to close these gaps within a reasonable time period, will be identified and included in a project-specific E&S Action Plan (ESAP), which will be attached to this ESRS, when available. Through this approach, the IPPs in the Program are expected to be designed and operated in accordance with the Performance Standards. Key E&S issues typically associated with solar IPPs in Tunisia are summarized in the paragraphs that follow.

PS1: Assessment and Management of Environmental and Social Risks and Impacts

The ESMS and capacity of each PE will be assessed against the requirements of PS 1 as part of the E&S due diligence process for each project. Each project will be required to develop and implement a project-level ESMS and an Environmental and Social Management Plan (ESMP) for both the construction and operation phases. The PE will also be required to have an adequately staffed E&S team.   

Power projects of less than 300 MW installed capacity do not require an environmental permit or preparation of an E&S Impact Assessment (ESIA) under Tunisian legislation. The transmission lines that will connect the PV plants to the grid also do not require an environmental permit under Tunisian legislation (Decree n° 2005 - 1991 of July 11, 2005). MIGA, however, will require the PEs to perform an E&S assessment commensurate to the risk of the project. Based on the 5 projects reviewed, in many cases, project Lenders will likely require an ESIA. 

Each PE will be required to develop a Stakeholder Engagement Plan (SEP) which will present the planned stakeholder engagement activities for the project and outlines a systematic approach aimed at developing and maintaining transparent relationships with stakeholders throughout the project’s lifetimes. The SEP will include an external Grievance Redress Mechanism (GRM) available in French and Arabic and consistent with MIGA’s PS 1 requirements so that stakeholders can raise any concern, provide feedback and comments about the project.

Each PE will also be required to develop an Emergency Preparedness and Response Plan outlining minimum requirements and guidelines for identifying and responding to possible emergencies.

As part of their ESMS, each PE will undertake regular on-site monitoring of the implementation of their ESAP, and key E&S and OHS plans during the project construction and operation phases.  As a condition of MIGA’s contract of guarantee, each PE will be required to provide MIGA with an Annual Monitoring Report that evaluates E&S performance against MIGA’s E&S requirements.

PS2: Labor and Working Conditions 

PS2 risks will be highest during the construction stage of projects and will relate primarily to ensuring good labor practices and safe working conditions during the delivery, installation, and testing of solar panels. These include. Key OHS risks include potential fire and explosion, slips and falls, hazards from moving machinery, heavy lifting, traffic accidents, electric shocks and burns, bites from venomous snakes and scorpions, and safety concerns during panel assembly. Additional risks will be generated by the handling of hazardous waste during the removal and disposal of used solar panels and other e-waste.

PEs will be required to ensure living and working conditions in accordance with national regulations and PS2 requirements for both direct and contracted workers, including access to a GRM, enabling anonymous grievances and gender-related issues handled sensitively. Training and drills for direct and contracted workers will be required to ensure effective management of emergency prevention and response systems.  Pes will be required to develop and implement OHS plans and procedures to address project-specific risks such as venomous reptiles and high outdoor temperatures, and covering roles and responsibilities, safe work procedures (e.g., work at height), Personal Protection Equipment requirements, OHS signage, medical support, access protocols, induction and refresher training, incident reporting, and performance monitoring. Where workers’ accommodation is required, they will be required to follow the IFC/EBRD Guidance Note on Workers’ Accommodation: Process and Standards.

Each PE will be required to develop a Supply Chain Procedure in line with MIGA PS requirements, and specifying selection, contractual agreements, auditing, monitoring and supervision requirements for contractors and suppliers. PEs will implement the requirements outlined in these procedures to ensure that suppliers and contractors are screened against the risks of child labor, forced labor, and significant safety issues requirements. PEs will be required to include appropriate E&S clauses in contractor agreements, including provisions on GBVH, and child and forced labor, and to ensure that ongoing monitoring provisions are in place. 

PS3: Resource Efficiency and Pollution Prevention

For all projects, greenhouse gas emissions during construction are expected to be minimal (i.e. well below 25,000 tCO2eq/year), mainly from fuel use in generators, transport, on-site equipment, and machinery. During operations, the projects are expected to contribute to GHG emission avoidance as part of Tunisia’s energy transition strategy.

The projects are expected to require water for construction (e.g. dust suppression, concrete production, domestic use) and operation (e.g. panel cleaning). Amount of water consumption and potential water conservation measures will be considered for each project. 

Projects will generate waste as well as dust and noise during the construction stage. Land clearance may result in erosion and sedimentation. Environmental risks associated with operation stage activities include noise, and potential oil spills with land and water contamination. 

All projects will be designed, implemented and operated in accordance with national regulations, PS3 requirements and the WBG EHS Guidelines. ESMPs will include waste management plans (including for broken and used solar panels) in line with good international industry practices (GIIP), national laws and MIGA’s PS 3 requirements. PEs will require their EPC and Operation & Maintenance contractors to develop and implement Pollution Prevention and Control Plan including dust suppression measures, speed restriction, regular maintenance of machinery and equipment, implementation of erosion control measures, an oil spill prevention and management procedure, providing spill and leak cleanup material and equipment. 

PS4: Community Health, Safety and Security

Projects will present health and safety risks to surrounding communities during the construction and operation stages due particularly to the transportation of materials, civil works, and labor camps. Risks will be higher during the construction phase given the increased level of activity. Key risks include traffic accidents, generation of dust and noise, and negative impacts of worker influx, including GBVH. 

PEs will be required to develop and implement appropriate management measures to address risks to community health and safety, including Influx Management Plans (if needed), Traffic Management Plans and Emergency Prevention and Response Procedures, and enforce a code of conduct for direct and contracted workers. Projects will also be required to undertake a security risk assessment, and prepare a security management plan, if needed. These measures will be supported by each project’s stakeholder engagement activities and grievance redress mechanism.

PS5: Land Acquisition and Involuntary Resettlement

Solar projects will require acquisition of land to construct the power plant and the required OHTL. Based on the 5 Tunisian projects already reviewed, the size of solar plants varied between 50 MW and 197 MW, land plots required for the solar plants ranged from 100 ha to 267 ha, while the length of the required greenfield OHTL varied between 0,2 km and 45 km. No physical resettlement was required for any of these projects, and economic displacement was limited.

To the extent possible, all projects will lease land from private landowners under a willing lessee, willing lessor arrangement, or will utilize government land, existing infrastructure facilities, and existing transmission line corridors to minimize the risk of involuntary resettlement. As a result, physical displacement is not expected, and economic displacement will be limited. Any project that requires significant physical resettlement will be excluded from this Program.

As part of its project-specific ESDD, the Lenders and MIGA will review the land acquisition process, including land acquisition for any associated facilities. If any displacement impacts are identified, the related project will be required to develop and implement a Resettlement Action Plan or Livelihood Restoration Plan in accordance with PS5 requirements, which must be implemented prior to the initiation of any civil works.

PS6: Biodiversity Conservation and Sustainable Management of Living Natural Resources

It is expected that the projects will primarily be constructed on previously disturbed land that has been subjected to past agriculture and intensive grazing by livestock, and as such, limited impacts on biodiversity are anticipated. Potential impacts of projects in proximity to protected areas include habitat transformation, disturbance of wildlife (e.g. lights and bats), accidental mortality of individual species (e.g. reptiles) during construction, and potential for bird collisions, particularly where the OHTL passes between and nearby to the Important Bird Areas. Cumulative impacts are plausible and may exacerbate potential adverse impacts on avifauna including migratory birds. 

To mitigate these risks, all projects will be designed and implemented in accordance with national regulations and PS6 requirements where triggered. Each project with an OHTL located in the vicinity of a sensitive or protected area will be required to engage STEG and a local BirdLife partner to consult on appropriate mitigations measures, and to allocate the necessary resources for the preparation and implementation of a Biodiversity Management Plan, including a section addressing the management of cumulative biodiversity impacts. Any project that overlaps areas of critical habitat or has impacts on nationally threated and near threatened species that cannot be mitigated will be excluded from this Program.

PS 8: Cultural Heritage

It is expected that the projects will primarily be constructed on previously disturbed land that has been subjected to past agriculture and intensive grazing by livestock, and as such, limited impacts on cultural heritage are anticipated. However, the relevance of this standard will be assessed during the ESDD for each project. In accordance with potential risks and impacts, each project will be required to develop a Chance Find Procedure or Cultural Heritage Management Plan as appropriate, in compliance with Tunisian Laws and with the requirements of PS8. For any project overlapping an area of potential archaeological interest, the PE will be required to undertake a pre-construction archeology survey (to be conducted by the Tunisian National Heritage Institute / Institut National du Patrimoine or an accredited specialist) prior to the start of the work. 

As projects with significant impacts on local communities are not expected to be part of the Program, Broad Community Support (BCS) determinations are =not likely to be applicable. For any Category A IPP, MIGA will assess whether a process of Informed Consultation and Participation (ICP) has been carried out effectively and the level of support among Affected Communities to determine BCS and this section will be updated to reflect MIGA’s assessment.  

The documentation listed below is available electronically as PDF attachments to this ESRS at www.miga.org. 

Voltalia S.A.: Menzel Habib project - See disclosed ESRS/ESAP.

For additional information, please contact: 

Voltalia S.A.

• Contact Name: Kamel El Hammami

• Address: Voltalia – 84 Boulevard de Sebastopol 75003 Paris France

• E-mail :  k.el.hammami@voltalia.com

MIGA supports its clients (as defined in MIGA Policy on Environmental and Social Sustainability) in addressing environmental and social issues arising from their business activities by requiring them to set up and administer appropriate grievance mechanisms and/or procedures to address complaints from Affected Communities.

In addition, Affected Communities have unrestricted access to the Compliance Advisor/Ombudsman (CAO), the independent accountability mechanism for MIGA. The CAO is mandated to address complaints from people affected by MIGA-guaranteed business activities in a manner that is fair, objective, and constructive, with the goal of improving environmental and social project outcomes and fostering greater public accountability of MIGA.\

Independent of MIGA management and reporting directly to the World Bank Group President, the CAO works to resolve complaints using a flexible, problem-solving approach through its dispute resolution arm and oversees project-level audits of MIGA’s environmental and social performance through its compliance arm.

Complaints may relate to any aspect of MIGA-guaranteed business activities that is within the mandate of the CAO. They can be made by any individual, group, community, entity, or other party affected or likely to be affected by the environmental or social impacts of a MIGA-guaranteed business activity. Complaints can be submitted to the CAO in writing to the address below:

Compliance Advisor/Ombudsman

International Finance Corporation

2121 Pennsylvania Avenue NW

Room F11K-232

Washington, DC 20433 USA

Tel: 1 202 458 1973

Fax: 1 202 522 7400

E-mail: cao@worldbankgroup.org