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Italy is planning to provide political backing for the Medlink project in a bid to import renewable energy from North Africa to Northern Italy via subsea lines, Bloomberg reported on Thursday, citing a project document it has seen. Italian officials have reportedly met privately with Medlink executives, signaling Rome's potential support for the project.
What’s Medlink? Developed by Italian energy firm Zhero, the project is scheduled to kick off operations in 2030, and could eventually expand to deliver green energy to Austria, Germany and Switzerland. It is already included in the European Network of Transmission System Operators for Electricity (Entso-e) long-term power transmission plan.
More details: The project involves installing 10 GW of windmills, solar panels and battery storage sites in Tunisia and Algeria with the aim of exporting 28 TW worth of renewable electricity annually to Italy’s Tuscany and Liguria via two high-voltage offshore cables, the document revealed. The imported energy would cover nearly 8% of Italy’s electricity needs.
Who’s financing this? Zhero has already secured over EUR 100 mn in startup financing but will need around EUR 5 bn for the project to be fully realized, the document disclosed, adding that development costs will need to be covered by future electricity customers. Zhero raised EUR 60 mn last month from Egyptian asset manager Azimut, American energy company Baker Hughes, French energy giant TotalEnergies, and pan-European Commercial Bank UniCredit to accelerate its green energy projects in Europe and Africa.
TotalEnergies may be an investor in Medlink: Zhero Europe — the company's operating platform dedicated to developing large scale renewable energy projects in Europe and Africa — and TotalEnergies signed a preliminary agreement for a minority investment in Medlink Tunisia last month.
REMEMBER- There’s already an Italy-Tunisia interconnection project in the works: Italy and Tunisia are already working on a separate EUR 1 bn electric interconnection project dubbed Elmed. Italy's Environment and Energy Security Ministry officially authorized the project earlier this month. The 600 MW subsea interconnector will transport 400-600 MW of clean power generated from hydroelectricity and is targeting an operational launch by 2028.
SPEAKING OF ELMED…
Tunisia approved three bills for EUR 100 mn worth of loan agreements to fund the Elmed electric interconnection project with Italy, Tap reported last week. The first bill approves a EUR 45 mn loan from the European Bank for Reconstruction and Development, the second approves a USD 20 mn loan (EUR 18.47 mn) from the Green Climate Fund through the International Bank for Reconstruction and Development, and the third approves a EUR 35 mn loan from German Bank for Development and Reconstruction. All the loans will be granted to the Tunisian Electricity and Gas Company (STEG) and will also finance the development of the renewable energy sector.
REFRESHER- Tunisia recently authorized another loan from the IBRD Bank for the project: Tunisia’s House of Representatives approved a USD 268 mn loan extended by the IBRD to STEG in February. The 600 MW subsea interconnector — which has recently been officially authorized by Italy's Environment and Energy Security Ministry — will transport 400-600 MW of clean power generated from hydroelectricity and is targeting an operational launch by 2028.
