IPTO, the independent power transmission system operator of Greece, and Saudi Arabia’s National Grid, wholly owned by Saudi Electricity Company have signed a memorandum of understanding (MoU) to establish a special purpose vehicle (SPV) – Saudi Greek Interconnection – which will be a joint venture and owned 50:50, for linking the two countries’ electricity systems.
The Greek Transmission System Operator’s (TSO) Chief Executive Officer Manos Manousakis signed the deal in with his counterpart from Saudi Arabia’s National Grid Abdullah Waleed Al-Saadi in Athens. About 40% of electricity in Greece is produced by renewables at present.
At the agreement signing ceremony, the two officials highlighted hydrogen, renewables, and electricity infrastructure as priority areas of Greek-Saudi cooperation in energy. The establishment of SPV is the first essential step for the maturation of the electrical interconnection between Greece and Saudi Arabia.
The agreement is a follow-up to the visit of the Saudi Arabia’s Prime Minister and Crown Prince H R H Mohammed bin Salman, to Greece in 2022 when both leaders held talks.
The MoU that was signed at the time for the energy cooperation between the two countries in various fields laid the foundation for the creation of the Saudi Greek Interconnection, which is in fact the first field of specialisation of this cooperation.
Saudi Arabia and Greece have been holding bilateral talks for the project for more than a year ago and around same time, Greece’s Deputy Minister of Environment and Energy Alexandra Sdoukou met with Assistant Energy Minister of Saudi Arabia Nasser Hadi Al-Qahtani.
The agreement is more relevant for the two countries as India has announced the plan to establish India-Middle East-Europe Economic Corridor (IMEC) in the recently held G-20 summit in India, which seems to be a reply to China’s Belt and Road Initiative (BRI).
Greece has drawn up ambitious plans to become a significant renewable electricity production and transmission hub for gas and hydrogen globally. After India’s announcement, the Greece Government set up a joint venture to establish a green power corridor all the way to Poland in the European Union (EU) for an interconnection with Saudi Arabia. The cooperation with Saudi Arabia in energy sector includes hydrogen.
According to Energypress, the Greek energy news portal, IPTO will submit the Green Aegean proposal to the European Network of Transmission System Operators for Electricity (ENTSO-E) in the next few days.
The Green Aegean proposal includes a power link between Greece and Germany into the European-wide organisation’s ten-year plan. The project is likely to be included in the EU’s list of projects of common interest and project of mutual interest (PCI-PMI). The initial capacity is planned at 3 GW and expected to be upgraded to as much as 9 GW subsequently.
Saudi Greek Interconnection will prepare feasibility studies on the economic viability of the project. A memorandum of understanding between Saudi Arabia and Greece also covered the areas of energy efficiency, oil, gas, petrochemicals, circular economy and decarbonisation.
Israel May be Included
Greece also planned an initiative for a green electricity corridor to Austria through the Western Balkans and it is set to connect with Cyprus, Egypt and Israel via subsea cables and upgrade its interconnections with Italy and Turkiye. The submarine links would also enable the transmission of renewable electricity from Egypt and the Arabian Peninsula to Europe.
However, Saudi-Greece Interconnection Grid is planned to run through Egypt through GREGY, but with Saudi Arabi and Israel trying to patch up their differences, it may also run the project through Jordan.