RPT-UPDATE 1-Munich Re touts Sahara in solar energy push

Tue Jun 16, 2009 12:41pm EDT

(Repeats to additional Reuters clients)

* Seeks support for solar power stations in Sahara

* Plants would supply power to Europe, Africa

* To meet Siemens, E.ON, Deutsche Bank on July 13

* Companies may support initiative for desert power

(Adds comments from Munich Re, green power group, institute)

FRANKFURT, June 16 (Reuters) - German reinsurer Munich Re (MUVGn.DE), facing billions of euros in claims for damage caused by climate change in coming years, is seeking to drum up support for an ambitious plan to build solar parks in the Sahara desert.

The reinsurer wants backing from other leading European companies for a feasibility study on generating a significant proportion of Europe's power needs in northern Africa -- at a cost potentially running into hundreds of billions of euros.

The project is the brainchild the Club of Rome, an association of social leaders who aim to foster sustainable development best known for its 1972 book 'Limits to Growth'.

Munich Re has invited several companies, including Deutsche Bank (DBKGn.DE), Siemens (SIEGn.DE), E.ON (EONGn.DE) and RWE (RWEG.DE), to meet on July 13 to agree on a joint project, said a foundation organised by members of the Club of Rome.

"We have approached Munich Re to get industrial companies on board and Munich Re organised the meeting with the other companies," said a spokesman for the Desertec foundation, which is fostering the idea to generate solar power in Africa.

The 20 companies and Desertec aim to sign a memorandum of understanding to found the Desertec Industrial Initiative which would commission studies on possible projects, he said.

A first power station with a capacity of 2 gigawatts in Tunisia with power lines to Italy would take five years to build once it gets regulatory approval, the spokesman said.

A possible long-term project could be a 100 gigawatt solar thermal power station in northern Africa and the Middle East. It could be finalised by 2050 with power lines connecting it to central Europe and would cost an estimated 400 billion euros ($555.8 billion), he said.

A solar power station with 100 gigawatt in western Europe -- where the sun shines for fewer hours and far less intensely than in the Sahara -- would be able to supply some 28 million homes, according to the German association of power generators.

The spokesman declined to name other participants at the July 13 meeting. German paper Sueddeutsche Zeitung earlier reported about the meeting, citing Munich Re board member Torsten Jeworrek.

"We want to start an initiative that would present concrete plans in two to three years' time," the paper quoted Munich Re as saying.

The Cologne-based German Aerospace Center, which researches power generation using renewable energy, estimates that North Africa could generate power to ship it to Europe as early as 2025, the head of the institute said. From 2050, some 20 percent of the power needed in Europe could come from northern Africa, Hans Mueller-Steinhagen told Reuters.

German solar company Solar Millennium S2MG.DE confirmed it had been invited to the meeting. (Reporting by Marilyn Gerlach, Jonathan Gould, Christoph Steitz and Peter Dinkloh in Frankfurt, Anneli Palmen in Duesseldorf, Jens Hack and Christian Kraemer in Munich; editing by John Stonestreet)

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