American readers of this blog will have noted that the rush to build utility-scale solar facilities is not confined to the desert Southwest, but has become a global phenomenon, as exemplified by the Spanish experience. As Abengoa and BrightSource have proven these facilities can be constructed in the developed world, there has been an emerging interest in pushing for them in the developing world, as well.
The Trans-Mediterranean Vision
Enter: DESERTEC. A wild-eyed, and possibly insane, dream of well-meaning industrialists from Germany, it proposed to finance a series of utility-scale solar and wind facilities across the Maghreb, and in particular the northern reaches of the Sahara. They would then construct sub-Mediterranean power connections to EU countries, providing them with “cheap”, “abundant”, “renewable” energy. Take a look at the map below.
It was madness. Conceived in 2009, when it appeared that the economic crisis might be behind us, it had a proposed price tag of €400 billion. One more time, that’s FOUR HUNDRED BILLION EUROS (about $550 billion at 2009 exchange rates). While that’s a staggering amount of money in any context, imagine it in terms of European economies: it’s equivalent to the entire GDP of Belgium. Incidentally, it’s about the same amount as Europe spent on oil imports in 2012.
Initially this project it was conceived by the Trans-Mediterranean Renewable Energy Cooperation, which emerged as a joint venture by the Club of Rome (a high-profile European think-tank that has inspired truly insane Illuminati comparisons) and Prince Hassan bin Talal of Jordan. They then incorporated into the non-profit DESERTEC Foundation, which functions as both a think-tank and clearing-house, bringing together renewable energy research arms of Maghreb governments, such as Morocco’s CDER (Centre de Développement des Energies Renouvelables, possibly now defunct based on the ancient website), and University researchers from around Europe.
Realizing that a non-profit alone couldn’t push through a project this big, the DESERTEC Foundation then participated in the forming of Dii (which ostensibly stands for the DESERTEC Industrial Initiative, though they rarely come out and say it), a limited liability German corporation which was to promote the project more directly through investment. The companies involved in Dii are a veritable Who’s Who of European finance and energy, both private and public, including Deutsche Bank, Abengoa, First Solar, Terna (the Italian energy giant), the Spanish Red Eléctrica (which operates the national grid); hell even oil companies like Royal Dutch Shell got in on the action.
However, as the financial crisis persisted, investing in hyper-sized energy projects began to seem like a suspect idea. Last year, the German tech giants Bosch and Siemens, who both have been instrumental in many solar projects both in Europe and the U.S., withdrew from Dii.
The other shoe finally dropped last week, when, in rather dramatic fashion, the DESERTEC Foundation withdrew from Dii altogether, citing “communication issues” (hat tip to Chris Clarke). DESERTEC co-founder Thiemo Gropp cited Dii’s abandonment of the trans-Mediterranean transmisison element as the primary reason. As to the loss of the huge corporate backing for DESERTEC, Gropp said that, “They are big names but they have produced small results.” Pretty tough words to be hurling at some of biggest names in renewable energy in Europe. Dii predictably has fought back, essentially calling DESERTEC irrelevant. But there is some validity to what Gropp says, as Dii has slowly backed down from the initial DESERTEC vision, as the economic situation has grown more and more perilous. (I’ll have more on the dissolution of DESERTEC in a different post)
Morocco Goes It Alone (with a little help from their friends…)
European political wrangling aside, there is still a market for clean energy in developing countries, particularly with financial incentives such as Clean Development Mechanism (CDM) available. That link goes to a pretty thorough explanation of CDM, but the basic principle, established in the Kyoto Protocol, is that rich countries can invest in “clean development” projects in poor countries, and earn tradable carbon credits which can be applied to carbon markets. Since Europe has a functional carbon credit trading market, European governments and countries were quick to move in the face of DESERTEC intransigence.
MASEN, the Moroccan Agency for Solar Energy, was more than happy to facilitate. Thus was born the Ouarzazate CSP Project, a 500MW parabolic trough solar plant to be constructed just outside the desert city of Ouarzazate, Morocco. The project is funded by a dizzying array of entities, including the World Bank, the African Development Bank, the EU itself, the European Investment Bank (the EU’s central bank), the German government, and the French government. The project is owned by ACWA Power, a Saudi water and energy conglomerate backed by Saudi government money. It will be executed by Acciona and SENER, two Spanish civil engineering firms which have been heavily involved in European utility-scale solar and wind projects, as well as Grupo TSK, a Spanish photovoltaic developer.
Not intending to be flip, it’s a bit surprising that Morocco actually has a fairly rigorous set of environmental review laws in place. That, combined with money flowing from the World Bank and African Development Bank, and relatively strict CDM regulations, mean that the Ouarzazate plant has had a relatively thorough environmental review process. The complete set of documents can be viewed here, but I’ll spare you the trouble, and review the particulars of the Ouarzazate CSP facility in the next post in this series. You can also check out the Ouarzazate CDM certification here.
It should be noted that the CDM has drawn lots of fire, for enabling rich countries to continue polluting, while getting carbon credits on the cheap. While Germany is funding this 500MW worth of solar in Morocco, with a total price tag of $2.65 billion, it is also adding a whopping 5,300MW of new coal-fired power plants in 2013. After Fukushima, a reactionary German public decided they weren’t in favor of nuclear power after all, and decided to close all 17 nuclear reactors in the nation, which represented 22.4% of demand at the time. While German deployment of solar, particularly on rooftops, is admirable, it’s just not a very sunny place. And since DESERTEC’s ambitious plans for shipping solar energy across the Mediterranean appear to be twisting in the wind, countries like Germany apparently have little choice but to add more dirty coal to their energy mix.
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