Conference convenes to establish Pan-Arab Regional Electricity Market in Egypt

The ratification process for the market’s key legal agreements was discussed yesterday during a session held by the Arab Ministerial Council for Electricity (AMCE) in Cairo. The legal agreements approval is expected next year.

In partnership with the Arab Fund for Economic and Social Development (AFESD), the World Bank Group and the League of Arab States (LAS) are launching today the first Pan-Arab Energy Trade Conference.

The 2-day conference, convened in Cairo, Egypt, is a key milestone towards finalizing the foundational stage of establishing the Pan-Arab Regional Electricity Market (PAEM). The ratification process for the market’s key legal agreements was discussed yesterday during a session held by the Arab Ministerial Council for Electricity (AMCE) in Cairo. The legal agreements approval is expected next year.

The conference assembles Energy and Electricity Ministers from the Arab States with regional and international energy experts to discuss strategic approaches to gather stakeholders, deepen the understanding of national and regional benefits of cross-border energy trade, and steps towards an enabling environment to align national priorities and regional goals to best exploit energy resources at the Pan-Arab level.

"The conference sheds light on a number of issues on the top of which is the strategic importance of the energy trade to the region's economies. It is also an opportunity to present the prospects and challenges facing the Pan-Arab energy trade in order to reach a consensus about means to boost it," said Dr. Kamal Hassan Ali, the Assistant Secretary-General of Economic Affairs, League of Arab States. 

Ali underscored the importance of the role played by the regional institutions in leading the way to create a Pan-Arab electricity market, establish the needed bodies to manage and govern this market, and invest in the electric power grid interconnections in addition to studying the potentials of regional cooperation in the energy sector. "These institutions should contribute to putting in place the deals to exchange electricity as well as amplifying the benefits of public and private investment in the energy sector on both the national and regional levels."

Throughout the last four decades, and with the financial support of the various financial institutions, the Arab countries worked on developing their electric power grid interconnections. “Regional trade in electricity and gas can be a powerful force for market integration, efficient resource utilization, and sustainable and inclusive growth,” said Anna Bjerde, World Bank’s Director of Strategy and Operations for the Middle East and North Africa.

MENA countries currently boast nearly 300 GW of installed electricity generation capacity. However, the available cross-border transmission interconnection capacity is only 15.8 GW, and only a fraction of that capacity is commercially utilized. “The regional energy market in MENA, once fully interconnected, would be the world’s second-largest regional electricity market after the European electricity market, providing a range of enabling factors are put in place such as stronger transmission grids and Investments in low-cost Renewable Energy,” said Paul Noumba Um, World Bank’s Regional Director for Infrastructure.