The energy infrastructure in the Mediterranean:

a TSO point of view

Enrico Zagari, North Africa Area - Terna Spa

2nd OPERATIONAL MEETING OF THE PAM PANEL ON EXTERNAL TRADE AND INVESTMENTS IN THE MEDITERRANEANGeneva, May 5, 2011

Regional Approach

In the middle and long term, a large part of investments in energy infrastructure foreseen in the Mediterranean region will be localized in the southern side

Regional Approach

Rationale

Requires

The connection to European markets along the South North axis, through energy infrastructure

The development of international exchanges along the South-South axis

The regional energy scenario

Demographic trend

Development of GDP

Energy Source Availability

(renewable and conventional)

The Gas Sector

The electricity scenario depends on the gas scenario

The gas sector: a changing framework

• Still primary source of electricity generation in the southern side• Ongoing changes in the reference market (shale gas) • Difficulties in infrastructures development planning •Slow down of investments in gas pipeline•Slow down in the auction procedures for the allocation of long term extraction rights

To monitor the ongoing phenomena

Electricity sector: The Corridor approach

Corridor approach drives the development activities (instead of point to point connections)

International exchange development doesn’t require the local market opening

Euro-Mediterranean initiatives in phases of development:

• Industrial initiatives Desertec (German lead initiative for promotion and trade of RES from MENA to Europe and promotion of sustainable development)Medgrid (French lead initiative aiming at the realization of an Euromediterranean grid and to promote trade of RES)

• Institutional initiatives: Paving The Way for Mediterranean Solar Plan ( EU project for the harmonization of the electricity regulatory framework and for the promotion of the use of renewable energy sources)

Terna is involved in all three initiatives

Development of the Energy infrastructures The Vertical corridors

South North corridor from MENA to Europe:

• The Western corridor: from Morocco to/through Spain•The Central corridor: from the center of North Africa to/through Italy• The Eastern corridor: from the Middle East to/through Turkey

Development of the Energy infrastructures The Horizontal corridors

• Maghreb: Tunisia, Algeria, Morocco• Mashreq: Egypt and the Middle East

The connection Maghreb – Mashreq : a Terna proposal already envisaged

Terna projects in the Mediterranean Region

Terna North Africa projects

Italy is the natural base for South North electricity exchanges

• Strategic position in the Mediterranean• Strong and well-interconnected electricity system with the rest of Europe• Advanced know-how in managing international exchanges and grid interconnections (SAPEI, SACOI, the only three-terminal in the Mediterranean, and Greece Italy)

New interconnections are under construction (Italy-Montenegro) or in phase of development (Italy – Algeria and Italy-Tunisia)

 

Terna Projects

Existing Submarine connections

Under construction

In phase of development

Envisaged

Connections to Europe

Italy - Greece

The investments

These investments represent a low level of risk in the presence of appropriate institutional conditions (international agreements, involvement of IFIs)

 

Essentialprecondition

Strengthening of North South cooperation

Development of the energy

infrastructure

Infrastructure investments are preconditions for economic and social development

Thank you for your attention