The Pan Arab Electricity Market (PAEM) is moving forward with its initiative to integrate the power systems of Arab countries. This plan aims to create a regional electricity market among members of the League of Arab States (LAS). Established in 2017 through a Memorandum of Understanding, the PAEM recently reached a key milestone with LAS members signing market agreements during the LAS Arab Council of Ministers of Energy meeting on December 2, 2024, in Cairo.
The Middle East and North Africa (MENA) region has significant potential for regional cooperation in energy. The establishment of PAEM could transform MENA's electricity landscape by reducing costs and optimizing resources. This coordination could save between $107 billion and $196 billion in system costs until 2035.
PAEM also has potential benefits for renewable energy development. It is estimated that it could unlock up to 192 gigawatts of renewable energy, driving job growth across the region. The World Bank projects that Egypt and Morocco could create nearly 2 million and 700,000 net jobs respectively over the next three decades through investments in solar and wind power infrastructure.
The advantages extend beyond energy savings; they include lowering electricity costs for various sectors like industry, agriculture, commerce, and households. Affordable electricity can enhance competitiveness, productivity, profitability, living standards, healthcare access, and education quality.
Furthermore, affordable electricity can improve water management through advanced irrigation techniques and desalination facilities. Overall poverty levels may decrease as well-being improves due to these changes.
A fully integrated PAEM would be one of the largest multi-country integrated power systems globally with over 600 gigawatts capacity. It would diversify sources and origins of electricity thus enhancing resilience against supply disruptions or geopolitical tensions.
Additionally there are opportunities for cross-border trade especially towards Europe where MENA can become a hub for clean energy supply contributing to global decarbonization efforts while fostering economic growth within MENA countries themselves.
The World Bank Group supports this integration effort including projects like ELMED which connects Tunisia with Italy allowing shared use of renewable resources further promoting sustainable solutions throughout both regions involved here today! A new study exploring other possibilities related specifically toward increasing trade between these areas now underway too!
In conclusion: Signing these agreements marks an important step towards transforming how we view not just our own but indeed everyone’s future when it comes down what truly matters most – sustainability itself being at forefront all decisions made along way!
"Ousmane Dione is the World Bank Vice President for the Middle East and North Africa region."
"Paul Noumba Um is the Regional Director of the World Bank's Infrastructure Department in the Middle East and North Africa region."