Grand Mediterranean plan

The energy sector is one of the key strategy areas of the Union for the Mediterranean, comprising the 27 EU member states plus 16 other countries circling the Mediterranean basin. Last year the union launched a Mediterranean Solar Plan (PSM), with three main objectives: to build an additional 20 GW of low carbon capacity by 2020, up from 1 GW today; to guarantee the profitability of projects by exporting some of the electricity to the EU; and to make significant steps towards reducing energy demand and increasing efficiency.

While the focus is on solar power, wind energy projects will also receive support on a "case by case basis," according to Philippe Lorec of the French environment ministry. This is because the cost of wind is "nearly at the level of the market" in much of the region. Projects may still need support in countries such as Syria, Jordan and Turkey to bring power purchase prices up to a level that encourages investment, he says. The PSM might also support offshore wind projects, for example in Tunisia, Turkey and Greece, where onshore installations face problems over land rights and security issues or local opposition.

The Mediterranean Union is now selecting pilot projects to test the regulatory, financial and institutional measures put in place. Of around 100 financially viable projects totalling 10 GW submitted, 55% concern wind energy. The aim is to select a shortlist of up to 30 of the most bankable projects, where financing can be arranged within the next two years, to be presented at the next meeting of the union. Technology transfer, efficiency and grid issues will also be taken into account. The aim is to have 1 GW installed by 2011.

Projects will be financed by the private sector where possible, with investors signing long-term power purchase contracts for output to be sold on the local or European market. Where projects are not immediately profitable, support could come from public funds such as European, national and multilateral initiatives or carbon funds.

At the same time, work has already begun on a "master plan" promoting large scale deployment from 2011 onwards. This involves establishing a regulatory framework, including for the export of electricity from one side of the Mediterranean to the other, and defining what support mechanisms will be available. A draft plan should be ready by October, with the final version agreed by July 2010.

The final piece of the jigsaw is the grid. The union is looking at five projects, including north-south lines and interconnections between countries. Priority areas include reinforcing the capacity between Spain and Morocco and to Turkey, linking Tunisia to Italy and building regional interconnections in the Middle East.

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