* Desertec to publish policy proposals by end-June
* In talks with Asian companies about membership - van Son
By Christoph Steitz
FRANKFURT, June 12 Europe needs to step up
support for an ambitious plan to import cheap solar and wind
power from African deserts or face a jump in power prices on the
continent over the next few decades, the head of the Desertec
The Desertec Industrial Initiative (DII), a consortium set
up in Germany in 2009, envisages Europe could import up to a
fifth of its electricity from solar and wind parks in North
Africa and the Middle East by 2050, thereby saving 33 billion
euros ($43.8 billion) in costs per year.
Desertec claims that within six hours, deserts receive more
power from the sun than can be used by mankind in a year.
But with a projected budget of 400 billion euros, the
project is regarded as too expensive and too risky - partly due
to unstable political conditions in North African countries. It
also needs strong political backing by Europe.
"Europe needs to act now, otherwise nothing will happen,"
Paul van Son, DII's chief executive, told Reuters in an
interview late on Tuesday.
In a bid to increase political backing for the project, DII
will later this month publish a study which will include policy
proposals for European governments about how they can make the
Desertec project work.
"If Europe does not wake up, it'll get much more expensive
for its citizens," van Son said.
Rising power bills have been a problem on the continent,
above all in Europe's top economy Germany, where subsidies to
expand renewable energy have inflated household energy bills.
Spread over 6,500 square miles, which is more than half the
size of Belgium, Desertec's projected delivery of more than 1
terawatt hours (TWh) would be almost enough energy to power the
whole of Germany for two years.
Van Son said that while incentive schemes had boosted the
expansion of wind and solar in Europe over the last decade,
conditions for renewables were in fact much better in the Middle
East and Northern Africa region, where the sun beats more
"It's a fact that you can build photovoltaic and wind plans
in Northern Africa without any subsidies," he said, but added
that the access to capital in the region was still a challenge.
Van Son said that wind and solar power could be produced at
costs of between 50-100 euros per megawatt hour (MWh) in North
Africa, even undershooting costs of 116 euros per MWh for
nuclear power in parts of Britain.
Last year, DII lost two prominent shareholders - German
engineering conglomerate Siemens and automotive
supplier Bosch. They left the venture after
unsuccessful forays into the solar sector at a time when it was
hit by global over capacities and price declines.
Other shareholders of the DII include German reinsurer
Munich RE, utilities E.ON and RWE
, as well as Deutsche Bank.
Other companies outside of Europe are showing interest in
the DII, including Chinese power company State Grid Corp
, van Son said.
"The process (talks) with State Grid is ongoing. But we are
also in talks with other Asian companies about a possible
($1 = 0.7533 euros)
(Editing by Jeff Coelho)