National Energy Grid


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Algeria's electricity demand is growing at a rapid, 5% annual rate, and will, according to Sonelgaz, require significant additional capacity -- possibly 8,000 MW by 2010 -- in coming years (currently, Algeria has around 6,000 MW of installed power generating capacity). This likely will require billions of dollars worth of investments in new generating capacity, plus transmission and distribution infrastructure (i.e., lines and sub-stations). In order to accomplish this, Algeria's government hopes to attract foreign capital.

In May 2001, Sonatrach and Sonelgaz established a joint venture -- the Algerian Energy Company (AEC) -- to export electricity. Among other projects, AEC is examining the feasibility of establishing a trans-Mediterranean power link to Italy, with the study expected to be completed in July 2003. In December 2001, Sonelgaz signed a joint venture agreement with Italian power grid manager GRTN on the possibility of constructing an undersea power cable to export electricity to Europe via Sardinia or Sicily. In November 2001, Sonelgaz signed a similar deal with Spain's power group Red Electrica de Espana to build an underwater power line between Algeria and Spain. Currently, Algeria has two links to the Moroccan electricity grid and supplies over 550 gigawatthours (GWh) of electricity to Morocco.

Sonatrach has a $107 million contract with Anadarko and Italy's GE Nuovo Pignone to build the country's first privately financed natural-gas-fired power plant at Hassi Berkine. GE Nuovo Pignone, a subsidiary of General Electric, will also provide a gas treatment system, liquid fuel gas turbine storage and services. In July 2002, Sonatrach and Sonelgaz formed a new, renewable energy joint venture company, called New Energy Algeria (NEAL). NEAL will look at development of solar, wind, biomass, and photovoltaic (PV) energy production. One project reportedly under consideration is a 120-MW hybrid natural gas/solar power plant and a wind/diesel/PV facility at Timimoun.



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