The energy challenges of the countries of the Mediterranean Basin

The Chairman of Ome - Mediterranean Energy Observatory, which brings together the 34 leading energy companies operating in the Euro-Mediterranean area - and Enel Chairman Piero Gnudi has made a speech in which he outlined the major energy challenges the Countries of the Basin must face. The Ome consists of 16 countries both producers and consumers of Energy, and plays a "bridging" role between industry and "policy makers", in particular the European Commission

In 2030 it is expected that the current 470 million inhabitants of both shores of the Mediterranean will become 570 million, of which 354 million living on the southern shore, 80% of which concentrated in Egypt, Turkey, Algeria and Morocco.

In the face of these demographic developments, between the early '70s and 2005, the average annual economic growth of the entire Mediterranean Basin amounted to 2,9%, but while the countries of the northern shore grew by 1,8%, those of the southern shore grew of 4,1%.

In this macroeconomic framework, the countries of the Basin will face two key energy challenges.
  First, meet the increased consumption in the South. Today, 70% of the energy demand in the Mediterranean is concentrated in the north. The total demand in the region has increased by 395 million tons of oil equivalent in 1970 to about 1000 million today, with the South today representing one third of total demand and which might increase its weight up to 42% of the total by 2030, while the North is characterized by low growth.

Similarly, the demand for electricity in the area has increased from 380 TWh in 1970 up to 1843 TWh in 2005, abd it is estimated to reach 3289 TWh in 2030. It is estimated that by 2030 new power plants will be built in the Mediterranean for a total of 372 GW. 68% of which will be allocated to the countries of the South, where the installed capacity is expected to triple, from 103 GW in 2005 to 358 GW by 2030, with the planned use of fossil fuels, mainly.

The Ome has calculated that the volume of investments required for the electricity sector, alone, in Southern countries should be around 450 billion dollars by 2030 and will include investments in generation, construction of new transmission and distribution lines, which are, to date, in many cases inefficient.
 CO2 Emissions in the Mediterranean have marked an average annual growth rate of 2% over the 1990-2005 period, by two-thirds attributable to the countries of the northern Mediterranean. It is expected that by 2030 the countries of the southern Mediterranean will contribute to 47% of total emissions, primarily for use of fossil fuels.

Winning the challenge of a sustainable and homogeneous development throughout the Mediterranean Basin will require designing new scenarios:
  First of all energy efficiency. Between 1990 and 2005 the energy efficiency per unit of GDP in the South has emproved by 1% against an improvement of 6% in the North. The paths of efficiency need to be harmonized, by sharing technology used.
  The development of renewable energy. Production from renewables in consideration of total electricity produced in the Mediterranean Basin represents approximately 17% of total electricity offered, only 2,8% excluding hydropower. The countries of the North shore instead produce about 75% of renewable electricity generation.

For the full development of renewable resources in the southern shores, the benefits of the European incentive systems must be transferred to renewables that are produced, and also implement schemes already expected to date, by developing interconnections, under the recent EU 28/2009 Directive for the promotion of renewables.
The very development of interconnections is the third essential tool for a homogenic growth of the Mediterranean. Today there are four electrical systems in the Mediterranean Region which are not mutually interconnected.

An interconnection ring through the Mediterranean should be set up, so as to achieve a single market for electricity, and direct South-North interconnections are also needed.
Italy has already signed an agreement in principle to build a submarine interconnection between Sicily and Tunisia, agreement now under study. Several other projects are being considered, from the creation ex novo of submarine links between Spain and Algeria, and between Italy, Algeria and Libya to strengthen existing linkages.

In this context, the Mediterranean Solar Plan, for which the Ome is making an important advisory and planning work, must be an opportunity not to be missed especially for the countries of the southern shores of the Mediterranean.

September 2009)