The governments of Egypt, Libya and Tunisia have committed to develop renewable power within their countries, with the aim of creating an integrated energy mix to meet the growing demand for electricity in the region, says a recently released report. The big challenge is pulling in the significant investment needed, as foreign investors are still cautious in the aftermath of the 2011 Arab Spring protests.
The stunted development of the sector’s infrastructure and ultimate deficit in power supply can be largely attributed to political uprising, although price subsidies, economic downturn, regulatory and technical inefficiencies have also contributed to the status quo. Despite support from the European Union, efforts to get the Mediterranean Ring regional power grid have also not progressed as hoped.
Morocco, Algeria, Tunisia, Libya and Egypt need to reform subsidies on fossil fuels to ensure long term sustainability within the regional power sector and take advantage of the numerous renewable energy resources available. As the region is strongly dependent on natural gas for power generation, diversification of the energy mix and incentive schemes for renewable energy may be necessary to encourage development of this sector.