Power generation in Algeria is currently dominated by fossil fuels with more than 98% being produced from fossil gas, followed by oil. Less than 0.3% of electricity is generated from renewable energy sources, mostly hydropower. Diversifying the power mix and increasing the share of renewable energy would make the sector more sustainable and more resilient.
Even though the Algerian government has put in place financial incentives to diversify the electricity production, the use of fossil gas has kept increasing, growing by around 107% between 2008 and 2020. The country has set the goal of achieving 40% of national electricity generation from renewable sources (37% and 3% from solar and wind power respectively) by 2030. Under the Framework of Sustainable Development, Algeria has also adopted measures to promote the development of low-carbon energy., However, much more stringent measures are needed for the power sector to reduce emissions in line with the 1.5°C goal. Our analysis shows that for the sector to become 1.5°C compatible, the use of fossil gas needs to be halved by 2030, and renewable energy needs to reach more than a 90% share in the power mix by 2040. With international support, Algeria could fully decarbonise its power sector by around 2040.