Timmermans’ Dream: An Electricity and Hydrogen Partnership Between Europe and North Africa

Because of differences in irradiation levels, it could be more efficient to produce solar electricity and hydrogen in North Africa and import these energy carriers to Europe, rather than generating them at higher costs domestically in Europe. From a global climate change mitigation point of view exploiting such efficiencies can be profitable, since they reduce overall renewable electricity capacity requirements. Yet the construction of this capacity in North Africa would imply costs associated with the infrastructure needed to transport electricity and hydrogen. The ensuing geopolitical dependencies may also raise energy security concerns. With the integrated assessment model TIAM-ECN we quantify the trade-off between costs and benefits emanating from establishing import-export links between Europe and North Africa for electricity and hydrogen. We show that for Europe a net price may have to be paid for exploiting such interlinkages, even while they reduce the domestic investments for renewable electricity capacity needed to implement the EU’s Green Deal. For North African countries the potential net benefits thanks to trade revenues may build up to 50 billion €/yr in 2050. Despite fears over costs and security, Europe should seriously consider an energy partnership with North Africa, because trade revenues are likely to lead to positive employment, income, and stability effects in North Africa. Europe can indirectly benefit from such impacts.