By: AGBI

Three ambitious projects to connect electricity grids in North Africa and Europe are experiencing contrasting fortunes as governments and corporations try to move forward on green energy.

At the eastern end of the Mediterranean, European Union and Greek energy officials have expressed strong support for two initiatives: the 1,208km, 1-gigawatt Greece-Cyprus-Israel Great Sea Interconnector and the 1,373km, 3GW Greece-Egypt Electrical Interconnection project.

Yet at the western end of the Med, there has been disappointment for the 3,800km, 3.6GW UK-Morocco Xlinks project, in which the UAE is a major investor. 

Morocco: Xlinks snubbed by UK

The UK government announced in late June that it would not offer Xlinks a “contract for difference” – or future minimum price guarantee.

This in effect halts Xlinks’ current development, even though the project was designated a nationally significant infrastructure project by a previous British administration.

Xlinks would have met 8 percent of the UK’s electricity needs, supplied by subsea cable from a 10.5GW solar farm in Morocco.

In a written statement to parliament, the UK government said Xlinks suffered from high “delivery, operational and security” risks and it preferred “domestic alternatives”.

“Xlinks being in line to supply 8 percent of UK domestic demand meant quite a heavy reliance on one project,” says Nivedh Thaikoottathil, senior analyst at consultancy Rystad Energy.

Sources have told AGBI that Xlinks offered to reduce the size of supply, but this could not persuade the UK authorities.

Xlinks may now try to connect with other countries, such as France and Germany, while also exploring a private sector off-taker in the UK. The UAE’s Taqa remains an investor, along with Britain’s Octopus and France’s TotalEnergies.

Greece: EU backing but Turkish opposition

Better news came for the Great Sea Interconnector (GSI) on July 17, when EU commissioner Dan Jørgensen visited Athens and said the project was of “the highest strategic importance” to Europe. 

The EU has already committed €657 million ($758 million) to the GSI, which hooks up Greece and Cyprus, then runs to Israel. 

It thus completes the Mediterranean end of the India-Middle East-Europe Economic Corridor (Imec).

In June, Kyriakos Mitsotakis, the Greek prime minister, also gave strong support to the GSI and the Greece-Egypt Electrical Interconnection project. The latter, known as Gregy, will supply green energy from Egypt to Greece.

However, both interconnectors run through maritime zones claimed by Turkey. 

While the Turkish claims are not recognised under the current iteration of the UN Law of the Sea, Ankara deployed warships earlier this year to try to enforce its case.

However, if the Turkish government attempts to block the GSI or Gregy, “Greece has said it will block Turkey taking part in European defence programmes,” says Charles Ellinas, CEO of EC Cyprus Natural Hydrocarbons. 

In addition, GSI is part of Imec, which is backed by the US, so Washington may also bring pressure to bear in any disputes with Ankara.

“I’m a lot more hopeful now for both GSI and Gregy,” Ellinas tells AGBI.

Another potential opponent, however, is Cyprus. 

The GSI is unpopular with some Greek Cypriots, given its €2 billion cost, much of which may be borne by them. The government in Nicosia is divided on approving the project. 

Meanwhile, a fourth interconnector – the more modest 220km, 600-megawatt Tunisia-Italy Elmed initiative – has strong backing from both countries’ governments, the European Bank for Reconstruction and Development and the EU.

It has another major advantage in that it presents none of the geopolitical challenges of other, grander schemes.

Thaikoottathil says Elmed looks the “most likely to materialise of all”.