1. IV Med Think 5+5 Forum Fostering Innovation Alliances in the Western Mediterranean: A basin of opportunities for a Sustainable Future Energy Efficiency and Transition in the West Mediterranean Dr. Emanuela Menichetti Director, Renewable Energy and Electricity
Corinthia Palace Hotel
Malta, 1-2 July 2019

2. The mediterranean IN A NUTSHELL
North
Croatia
Cyprus
France
Greece
Italy
Malta
Portugal
Slovenia
Spain
Other North
Albania
Bosnia H.
Macedonia
Montenegro
Serbia
South East
Israel
Jordan
Lebanon
Palestine
Syria
Turkey
South West
Algeria
Egypt
Libya
Morocco
Tunisia
The 5+5 countries:
280 million people – 4%
648 Mtoe primary energy demand – 5%
6.2 trillion USD – 5%
1.2 GtCO2 – 4%

3. ENERGY CONSUMPTION TRENDS – current policies
By 2030, SEMed countries will take over as the largest energy consumers. Different energy demand trends in 5+5 countries : -30% in the North, +47% in the South

4. ENERGY DEMAND BY FUEL & REGION - current policies
Strong decrease of all fossil energy technologies – and nuclear by 2040 in the North, with non-hydro renewables to account for 36% of TPES
In the South, fossil fuels still dominating the energy mix, although non-hydro renewables experience a four times growth to 2040 to account for 10% of the supply mix.

5. ENERGY INTENSITY- current policies
Increasing need to re-orientate energy policy to decouple energy consumption from economic and demographic dynamics in the South and East Mediterranean

6. CO2 EMISSION TRENDS
CO2 emissions showing a clearer downward trend in the North
By 2040, with current policies a -17% expected in the South and East Med, -24% in the North
Significant efforts needed to decarbonize industry and transport sectors

7. GOOD PROGRESS IN THE POWER SECTOR
In the North, generation to go green, with RE becoming the first generating source by 2040.
In the South, gas will remain the primary fuel, under both scenarios, with relatively improved outlook under the PS.

8. RENEWABLE ENERGY CAPACITY
Almost 200 GW of RETs in 2018 in the North Med
Italy, France and Spain account for about 90% of total North capacity
Hydro is still the dominant source, accounting for 43% of total RE installed capacity in 2018.
In the last ten years, impressive growth in both wind and solar PV, accounting for 31% and 20%, respectively of total RE capacity.
Market still concentrated in few countries - 90% of total RE capacity in the Mediterranean (5+5) exist in Italy, France and Spain.
Total RE capacity in the SEMed reached 56 GW in 2018
The 5 South countries account for about 9% of SEMed capacity

9. trajectories towards RE targets
The EU is moving towards achieving its collective RE target of 2020.
In the South, with the exception of Algeria & Libya, other South MED countries are making a good progress in achieving their targets.

10. 5th & 95th Percentiles Range, 2018
Increasing RE cost competitivEness in the South MED
Record wind and solar PV based-electricity prices in the region.
Technology
5th & 95th Percentiles Range, 2018
Wind (onshore)
44 – 100 PV
58 – 219
CSP
109 – 272
Source: IRENA
The prices from IRENA against which the comparison is made refer to the Levelized Cost of Electricity (LCOE), whichi is not necessarilty comparable to announced bid prices:
- LCOE (indicated by IRENA): refer to commissioning dates. The LCOE is calculated based on the following assumption; real weighted average cost of capital (WACC) is 7.5% for OECD countries and China and 10% for the rest of the world. In terms of financing, 7
Bid prices (SEMCs): refer to announced dates.
It is very important to understand that the prices are country-specific and site specific…..The factors explaining LCOE in general and bid prices, in particular, are:
Technology improvements – solar module efficiencies, larger wind turbines and blades, etc…
Technology cost reductions due to economies of scale
Resources availability - developed in best suitable sites
Capacity factor – related to technology and resources availability
Policy framework - especially vis-à-vis the country’s long-term commitments and transparency, and other fiscal incentives.
Financing – low rates (due to either concessional loans or low risk markets).
Lead-time – between the time of bidding and construction
Auction design and PPA terms and conditions.
Notes: Prices refer to auction awarding date. Tariffs for Midelt Phase I include both PV and CSP.
Source: OME database

11. energy TRANSITION measures IN THE 5+5
Country
Energy Efficiency
Renewable Energy
CO2 mitigation
SOUTH
Algeria
-9% of energy consumption
27% of electricity generation
Min of -7% (up to -22% if intern. financing)
Libya -
Mauritania
20% of the energy mix by 2020
-22.3% compared to BAU
Morocco
-15% of energy consumption
52% of electricity capacity (2030)
Min. of -13% compared to BAU (up to -42%)
Tunisia
-30% of energy demand vs. BAU (2010)
30% of electricity generation (2030)
Min of -13% compared to BAU (up to -28%)
NORTH
France
Italy
Malta
Portugal
Spain
An EU collective target to reduce greenhouse gas (GHG) emissions by at least 40% by 2030 compared to 1990 level
Under the Clean energy for all European package:
At least 32% of RE in gross energy consumption by 2030,
Member States are required to draft 10-year National Energy & Climate Plans (NECPs) by end of 2019.
Objectif global d’atténuation en Tunisie : réduire l’intensité carbone de 41% en 2030 en comparaison avec l’année de base 2010 : -13% inconditionnel et -28% conditionné par l’appui international.
Le sous-objectif d’atténuation pour le secteur Energie : réduire l’intensité carbone de 46% en 2030 en comparaison avec 2010 : -15% inconditionnel et -31% conditionnel.
Mauritania – for GHG emissions, National efforts account for 12% only, whereas unconditional efforts should contribute with 88%.
Source: Based on UNFCCC Nationally Determined Contributions to the 2030 horizon, and European Commission

12. Conclusions AND Recommendations
The energy mix in the Mediterranean region is still heavily dominated by fossil fuels, and increased consumption in the SEMed
Mixed energy transition trajectories across the region, with the North moving more steadily towards the targets
Regional cooperation is a key driver to enable energy transition at regional level, and UfM platforms are an important tool to be used to exchange data and best practices
Market experience shows that under certain conditions SEMed are capable to attract investments into RETs at record low prices
Access to finance would undoubtedly unlock the region’s potential, and thereby contribute to the energy transition
The South MED countries, in particular, need to speed up the implementation of their national plans
The year 2020 will be a cornerstone and will set the tempo for the deep transformation required in the years to come -> important role to play by the 5+5 dialogue
Progress towards several sustainability targets will be evaluated by that deadline at different levels, for instance:
The 75th birthday of the UN
COP26
Revision of some SDGs targets
2020 EU climate and energy package
Several CSR targets set to 2020