Rome is committed to being the great distribution center for African gas while Madrid bases its plans on green hydrogen and other renewables
The Russian invasion of Ukraine has shifted the center of gravity of the energy geopolitics in Europe. The abrupt disconnection of the russian hydrocarbons has forced the continent to rethink its supply sources and improvise on the fly alternatives for supply. The east west flows are rapidly drying up, a paradigm shift that has opened up new opportunities for countries like Spain and Italywhich hardly had weight in the old energy map. The south now claims its space on the new board, taking advantage of its proximity to the deposits in North Africahis gas infrastructure or its potential with renewable. It will not be easy, however, because there is an abyss between the political slogan and the ambition embodied.
So much Rome as Madrid have given free rein in recent months to their intention to become a distribution center for export energy to the rest of Europe. An aspiration initially centered on the natural gas, but which, in the case of Spain, has been mutating as its options in this area have closed. As much for the disastrous management of their alliances in North Africa as for the closure of France to allow the new interconnections with which the Government of Pedro Sánchez intended to expand the Spanish capacity to send gas to the rest of the continent.
“Spain has had no choice but to bet at the end on the renewable hydrogena very medium-term plan & rdquor ;, he affirms Alejandro Nunez-Jimenez, senior researcher at the Swiss Federal Institute of Technology. “On the other hand, the one in Italy is a bet in the short term and for gas. He thinks that Europe will continue to use gas long enough to justify the multimillion-dollar investments that it has announced& rdquor;. Two different approaches in the end and without too many signs of collision, although plagued with unknowns and risks, according to the half dozen experts consulted.
Spain had a priori the conditions to become a great reception, processing and export center of the liquefied natural gas (LNG) that arrives on the mainland methane tankers from USA, Africa and other parts of the world. Not surprisingly, it has more capacity to store it and process it through your regasification plants than any other country in the European Union. 44% and 34% respectively of community capacity, according to Enagás. Not to mention the two gas pipelines that supplied the peninsula from Algeria. But it has a serious problem: it is a “energy island & rdquor; barely interconnections with Europebeyond the two modest tubes that reach France from Navarra and Guipúzkoa.
Frustrated gas dreams
“Without new connections that cross the Pyrenees, there is no It makes no sense to raise the idea of a gas hub”, he affirms Marian March, member of the Repsol board of directors and professor at the UB. “If you add to that the fact that the majority of northern European countries have started to build floating regasification plants to receive the methane tankers directly on its shores, there is little more to say& rdquor ;. At the end of last year Madrid announced an agreement to increase the capacity of the two existing connections with France by 18%, but the large projects that Spain and the operator enagás considered to make a real qualitative leap failed in Paris and Brussels.
First the pipeline MidCat, half-built for years, and then its namesake submarine that was to unite Barcelona with the Italian port of Leghorn, in embryonic phase only. “Were projects that were in the drawer and they were resurrected when the ukrainian war fearing that Europe would run out of gas& rdquor ;, explains Peter Fresh, the former general director for the ecological transition of the Generalitat Valenciana. “At that time, given the urgency, any infrastructure could make sense, but as anxiety has subsided, certain infrastructures have once again lost meaning due to their costs and time& rdquor ;.
the italian ordeal
An analysis that does not seem to share or Italy nor its energy industry. Unlike Spain, which has managed to weather its modest dependence on russian gas making use of its six powerful LNG regasification plants, Rome faced a major challenge: supplying in just a few months the kremlin gas, which contributed 40% of its consumption. And how did he do it? Going shopping like there’s no tomorrow. In the last year it has closed numerous agreements to increase its supply from Algeria, Libya either Azerbaijan or to search for new suppliers in Angola either Congo. A policy that began with Mario Draghi and has continued with Georgia Meloni. The far-right leader proclaimed at the end of January in Libya that “Italy wants to become a energy hub for all of Europe & rdquor ;.
Particularly to sell the gas from North Africa, where it has lost Spain as a major competitor, as a result of the Sánchez’s alignment with Morocco on the question of Occidental Sahara. Since then USA has replaced Algeria as the main Spanish supplier, while Algeria replaced Russia as the primary source of Italian gas.
Italy, unlike Spain, does have the geographic location and the interconnections necessary to reach Europe. But you need to transform your internal infrastructures. “The Italian network was not conceived to make Italy an exporting country, but an importing one, so it will need a capital investment to adapt their system& rdquor ;, assures Francesco Sassi, expert of Industrial and Energy Research Institute (RIE) of Bologna. From reversing the flow of the gas pipelines that connect Italy with other parts of Europe to significantly expanding its internal network of pipes to channel the fuel that reaches its southern ports from North Africa and the Caspian Sea to the north of the country. Most of it arrives by gas pipeline, but Rome’s intention is to also increase the reception of methane tankers.
energy transition
In a country known for its devilish bureaucracy, Sassi doubts very much that he can achieve it in a reasonable amount of time. And it is that many of the projects proposed now had been archived for years. Paralyzed by their costs, their technical difficulties or the multitude of geopolitical variables on which they depend. “The government plan responds to a hypernationalist vision of the energy market in Europe that does not quite adjust to reality & rdquor ;, says the expert in the geopolitics of energy. “Building this network would link Italy to gas for decades when Europe is in full transition to renewables & rdquor ;.
And it is this obvious contradiction that Spain is now clinging to, forced by circumstances, after seeing how its gas plans ran aground. Of his energy efforts, the only plan that has come to fruition is the H2Med hydroduct to transport green hydrogen from the Peninsula to France and Germany, a project that would not be ready until 2030. “There is a lot of marketing in all this because we don’t even know if we will have a surplus of hydrogen to export it,” he says eloy sanz, professor of energy engineering at the Rey Juan Carlos University. The little national hydrogen that is produced at the moment is destined for refineries and the like. “We are already planning the export when we have not even guaranteed our consumption nor have we decarbonized our industry with renewable hydrogen & rdquor ;, Mariano Marzo redounds on that point. “There is a lot of politics in all this & rdquor ;.
All the experts agree that if Spain has any future as an exporter of a certain entity -it already exports some electricity- its future lies in renewables, including hydrogen produced with solar and wind energy. Caution is, in any case, the norm. “In the world of renewables we are going to, the idea is to produce most of what you consume in your territory. I believe that Spain may be a small exporter to Europe, but it will not be the Saudi Arabia of renewables& rdquor ;, says Pedro Fresco.