Retrospective analysis of Hammam Biadha renewable energy project

Ex post socioeconomic impact evaluation is based on document review, site visits, and interviews with project personnel. Although the planned PV system is operational, the project achieved neither its economic nor its demonstration objectives. There is little evidence that economic activity increased due to the new system, or that the local farm economy approved. The project's only employment impact was the generation of jobs for four STEG personnel (i.e., 3 guards and 1 operator). Socioeconomic impacts were also limited. Further, the system is neither covering recurrent costs nor amortizing any of its fixed investment costs. It generates about $800 (equivalent) annually in revenues, while losing the equivalent of $13,000 per year. Although data for an adequate cost/benefit analysis are unavailable, it is clear from the large initial investment, the large yearly operating loss, and the small number of beneficiaries - 25 families and 1 school - that the system's operation is uneconomical and represents an inefficient deployment of A.I.D. and Tunisian assets. Although the PV system gained wide publicity through informal demonstrations (i.e., visits by Tunisian and donor personnel), agricultural demonstration activities did not achieve the planned spread effects, perhaps because STEG, as an energy agency, was not very involved in developing agricultural applications. Technologies such as PV-powered drip irrigation and solar greenhouses were not adequately tested. The Ministry of Agriculture would probably have been a better lead agency. Among lessons learned are that: (1) the project as designed was really an integrated rural development project in disguise, and, not surprisingly, suffered from a serious lack of institutional coordination; (2) agency roles and responsibilities should be carefully evaluated vis-a-vis project goals; (3) energy projects should not be an end in themselves and should therefore be evaluated in terms of how they can help other sectors, e.g., health; (4) better information dissemination, within countries and internationally, is needed for demonstration projects; (5) demonstration projects must include a framework by which change can be measured; and (6) host country social scientists should not conduct the social impact assessment of a project.