Algeria’s Solar Market Moves Beyond Potential As Execution Takes Center Stage

ALGIERS – Algeria, a nation endowed with some of the world's highest solar irradiation levels, is finally translating its immense renewable energy potential into tangible megawatts. According to an analysis published by PV Magazine in collaboration with the Middle East Solar Industry Association (MESIA), the Algerian solar market has entered a critical new phase-one where success is no longer measured by natural resource advantages but by the ability to finance, connect, and sustain large-scale photovoltaic projects.

According to reports, Algeria plans to install 15 gigawatts (GW) of solar capacity by 2035, with the target of 3.2 GW already under development in the southern and High Plateau regions. The Africa Solar Industry Association (AFSIA) has reported that Algeria has 2.87 GW of solar capacity planned, and 2.6 GW is under construction. Algeria's growth rate in solar capacity is among the fastest in Africa, second only to South Africa, Nigeria, and Egypt.

In recent months, some key milestones have occurred. In May 2026, the Minister of Energy and Renewable Energies Mourad Adjal inaugurated two photovoltaic power stations of 200MW capacity each in the municipalities of Tendla (located in El-Meghaïer province) and El Ghrous (located in Biskra province), which represents a significant step for the country's renewable energy strategy. Very soon after that, the 220 MWp Leghrous Solar Photovoltaic Power Plant project carried out by Chinese POWERGAIN did become the first project implemented under the Algerian Solar Development Plan of 3.2 GW/

Algeria is expected to commission nine other solar power stations of total capacity of 1480 MW by August 2026 according to Khalil Hedna, Director of Information and Communications of the Ministry of energy and renewable energy. Overall, it is expected that the country will gradually commission over 1.4 GW of solar Generation capacity by that time. Meanwhile, the Algerian company Sonelgaz is planning to carry out a new tender for solar generation capacity of 2000 MW for 15 solar parks which capacity will vary from 80 to 220 MW located in 11 different sites throughout the country.

Algeria's electricity system remains overwhelmingly dependent on natural gas, which accounts for approximately 99% of national power generation. Yet rising domestic consumption is placing mounting pressure on this resource-a resource that also represents the country's primary export revenue stream.

"The energy transition is taking a pragmatic turn," explains Boukhalfa Yaici, Director of the Algeria Green Energy Cluster (GECA). "Every megawatt-hour produced from solar or wind preserves an equivalent quantity of natural gas". This formulation captures the national imperative: solar energy is not merely an ecological lever but an economic arbitrage tool designed to free up gas volumes for high-value exports or local industry.

Ghazi Koubaa, Project and Solutions Manager at LONGi MENA, notes that Algeria's transition differs fundamentally from that of fuel-importing nations. "It's not mainly about escaping an import bill," he told a recent Solarabic-MESIA webinar. "It's more about preserving gas for higher value export, meeting rising domestic demand, diversifying the energy mix and preparing for future carbon taxes from Europe".

Despite the momentum, significant hurdles remain. The current market model relies heavily on state utility Sonelgaz, which serves as offtaker, grid operator, and competitor-a structure that has lengthened power purchase agreement (PPA) negotiations to beyond two years and slowed tender award schedules. Historically, the model has been based on Sonelgaz financing and owning infrastructure before launching engineering, procurement, and construction (EPC) tenders. While this approach has enabled the launch of initial projects, it imposes a substantial financial burden on the public sector.

Professionals in the field agree that the country won't be able to reach the 15 GW target without the use of the Independent Power Producer (IPP) model that will open the electricity sector for private investors and foreign developers. "There are five basic pillars of success of large scale implementation," explains Yacine Boulfrad, the technical development manager of Scatec. "They are stable regulations, bankable power purchase agreements (PPA), competitive and clear tenders, fast procedures of permitting, and strong public-private partnerships." In this regard, he points out that Scatec has been successful in Tunisia, where they obtain solar power tariffs lower than US$0.03/kWh, and believes that Algeria can achieve at least the same figures using the IPP model.

The Algerian government has signaled its commitment to reform. The 2026 draft finance law includes reduced customs duties of 5% on products intended for the manufacture of solar panels, as well as measures to support renewable energy development. Recent amendments to the financial law have also opened the door to international financing. The repeal of the 51/49 foreign-ownership rule has created substantial headroom for private and foreign capital.

International partnerships are already deepening. Chinese firms have been particularly active: POWERCHINA completed the landmark Biskra project, Sineng Electric supplied 154 MW of central inverters for two utility-scale projects in Béchar and Ouargla provinces, and Astronergy supplied the entire capacity of PV modules for the 220 MW Biskra project. China's JinkoSolar has also inked a 100 MW deal. In the first quarter of 2026 alone, Algeria imported 0.31 GW of solar panels from China, and in the 12 months ending June 2025, imports reached 1.2 GW-a 33-fold increase year-on-year.

As Algeria's solar energy domain progresses from a stage of innumerable possibilities, the forthcoming several years will be a challenge for the nation when it comes to the ability to convert dreams into actual projects that are funded, established, and sustainable. Having lots of sunshine, being not far from European energy markets, and being convinced of the rationale of economic diversification, Algeria has everything for the success of solar energy projects. Now the only question is if Algerian regulations and investment systems can adapt quickly enough to help achieve the full power of the Sahara sun.