What is Algeria's pathway to limit global warming to 1.5°C?
Power
Decarbonising the power sector
Algeria’s power supply is dominated by fossil fuels. In 2022, gas supplied 99% of electricity, while renewables contributed 1%.1 Since 2011, the Algerian government has targeted renewable energy capacity of 22 GW by 2030,2 with an intermediate target of 4.5 GW to be brought online by 2020.3 As of 2023, however, Algeria had installed just 590 MW.4 Recently, government officials have referred to a new target of 15 GW of installed renewable capacity along with 1 GW of off-grid solar by 2035 which will supply the domestic market.5 Missing its 2020 target and unclear communication of current targets highlights a gap between policy planning and implementation, creating uncertainty for potential investors.
Algeria's power mix
terawatt-hour per year
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Graph description
Power energy mix composition in generation (TWh) and capacities (GW) for the years 2030, 2040 and 2050 based on selected IPCC AR6 global least costs pathways. Selected countries include the Stated Policies Scenario from the IEA's World Energy Outlook 2023.
Methodology
Data References
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The Minimal CDR Reliance pathway would see Algeria’s electricity mix diversify away from fossil gas towards renewables and hydrogen. Given the cost competitiveness of wind and solar along with Algeria’s huge potential to roll out these technologies, they make up the bulk of the transition to a low-carbon grid.6 By 2030, renewables would make up 30% of electricity generation under the Minimal CDR Reliance pathway, with that share rising to 94% by 2050.
Following the Minimal CDR Reliance pathway would also see a moderate share of hydrogen in the mix. By 2030, hydrogen would make up less than 2% of electricity generation, with that share rising to around 6% by 2050. Algeria’s hydrogen strategy aims to begin scaling up production in the mid-2030s.7,8
Fossil gas is effectively phased out by 2040 across all pathways. By 2030, it would have a 42-66% share in electricity production, with this share tumbling to 2-12% by 2035. This shift away from gas would require strong policy interventions and financial support for the expansion of renewables.
Algeria's power sector emissions and carbon intensity
MtCO₂/yr
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Graph description
Emissions and carbon intensity of the power sector in selected 1.5°C compatible pathways.
Methodology
Data References
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Power capacity investments
Algeria’s 2035 target of installing 15 GW of renewables along with 1 GW of off-grid solar for its domestic market is not 1.5°C compatible, with all assessed 1.5°C pathways surpassing the 2035 target by 2030.
The Minimal CDR Reliance pathway would see renewables capacity increase to 24 GW by 2030, most of which (79%) would be solar. This would be supported by annual investments of USD 2.7 bn between 2026-2030. Annual renewables investments would rise to USD 4.2 bn between 2031-2040 as more capacity is brought online to support the phase out of gas, with a total installed capacity of 116 GW of renewables by 2040. This is significantly less than the USD 50 bn which Algeria has committed to spend on its hydrocarbon sector over the next four years, most of which will go towards exploration and production.9
Algeria has some of the highest solar irradiance in the world and a 1,300 km coastline with strong wind speeds, making it rich in renewable resources.10 However, it has been slow to tap this potential and has fallen behind its neighbours in rolling out renewables.11 Renewables development has primarily come through partnerships with Germany and China, with Germany supporting green hydrogen development that can be exported to Europe while China supports the development of solar intended for domestic use in Algeria.12 However, these developments are not yet online.
Our data does not account for additional investments related to exporting clean energy, nor do the figures include costs related to energy storage and grid upgrades.
Algeria's renewable electricity investments and capacities
Billion USD / yr
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Graph description
Average annual investments in power sector renewable electricity capacity and cumulative installed power capacities across time under 1.5°C compatible pathways downscaled at country levels.
Methodology
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1.5°C compatible power sector benchmarks
Carbon intensity, renewable generation share, and fossil fuel generation share from illustrative 1.5°C pathways for Algeria
| Indicator |
2022
|
2030
|
2035
|
2040
|
2050
|
Power sector decarbonised by
|
|---|---|---|---|---|---|---|
|
Carbon intensity of power
gCO₂/kWh
|
509
|
200 to
318
|
10 to
58
|
6 to
10
|
-1 to
0
|
2041 to
2045
|
|
Relative to reference year in %
|
-61 to
-38%
|
-98 to
-89%
|
-99 to
-98%
|
-100 to
-100%
|
| Indicator |
2022
|
2030
|
2035
|
2040
|
2050
|
|---|---|---|---|---|---|
|
Share of unabated coal
%
|
0
|
0 to
0
|
0 to
0
|
0 to
0
|
0 to
0
|
|
Share of unabated gas
%
|
99
|
42 to
66
|
2 to
12
|
1 to
2
|
0 to
1
|
|
Share of renewable energy
%
|
1
|
30 to
55
|
82 to
95
|
93 to
95
|
94 to
98
|
BECCS are the only Carbon Dioxide Removal (CDR) technologies considered in these benchmarks
All values are rounded
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Methodology
Data References
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