Opinion
by Nicos Tsafos
The US decision to shift its focus from the EastMed gas pipeline to regional electricity interconnectors is an opportunity for Greece. The pipeline has always been a long shot, and the case for pursuing it may have run its course. Greece now has a chance to reframe the dialogue around energy and climate change in the region, and it should seize it.
The shift in the US position, therefore, should be seen as affirming what most analysts have known for years: The pipeline faces serious obstacles and is unlikely to be built.
The EastMed pipeline has always presented a conundrum. The proposed pipeline served as a catalyst for regional collaboration. It cemented a burgeoning rapprochement between Greece and Israel, and it brought Cyprus and Israel closer too. The networks developed to advance the pipeline helped launch a platform, the East Mediterranean Gas Forum (EMGF), which further spearheaded regional dialogue. Without laying a single mile of pipeline, EastMed has transformed the geopolitics of the Eastern Mediterranean.
But the prospects for the pipeline have always been tough. The pipeline itself would be expensive, and the market in Southeast Europe would struggle to digest the volumes needed to make the pipeline work, especially given competition from other suppliers.
The European Green Deal has cast further doubt on the project since the payback period for such pipeline projects runs to 15 or 20 years, just when Europe should be carbon neutral. Unless the pipeline could align with Europe’s energy transition, public finance was unlikely to materialize. These headwinds have been obvious for years.
Meanwhile, the gas in the Eastern Mediterranean is no longer stranded. The largest discoveries in Israel and Egypt have been developed. A regional market has re-emerged with Israel and Egypt selling gas to Jordan, while Israel also ships gas to Egypt. Egypt’s own position has been upended: Its liquefied natural gas (LNG) exports reached a 10-year high in 2021. Some gas remains undeveloped, mostly in Cyprus and some in Israel, but those resources are scattered across multiple fields, many of them of modest size. The opportunities for further development are more limited at this point.
Against this backdrop, the US announcement that it is focusing on electricity interconnectors comes as no surprise. Washington always supported the pipeline but never shared the enthusiasm for it that certain regional players did. Moreover, the pipeline brought complications, especially vis-a-vis Turkey. How to strengthen regional collaboration while managing the ever-deteriorating relationship with Turkey has been a never-ending pursuit for US diplomacy.
The shift in the US position, therefore, should be seen as affirming what most analysts have known for years: The pipeline faces serious obstacles and is unlikely to be built. US diplomacy is also looking to support projects that are consistent with the long-term need to lower greenhouse gas emissions. These forces help explain the new US approach.
This is an opportunity for Greece. Over time, the EMGF should evolve into an energy and climate forum. Regional leaders have repeatedly said that the forum could follow in the footsteps of the European Coal and Steel Community, which led to today’s European Union. Taking the next step is a logical progression, not an indication of failure.
Electricity is a powerful conduit for channeling the region’s focus. Electricity interconnections are often easier to build than gas pipelines, even if connecting the grids of Egypt, Cyprus and Greece is a serious and challenging undertaking. More importantly, there are new technologies that countries can collaborate on: offshore wind, hydrogen, carbon capture and storage, sustainable mobility, smart cities, and many others.
This is also an opportunity to talk more about climate change. The region will witness some of the sharpest declines in precipitation around the world. Heatwaves will be more frequent. These stressors could pressure regimes and produce a new wave of migration. It will be easier to enhance resilience together rather than alone.
Greece’s opening to the Eastern Mediterranean has been one of the most successful diplomatic initiatives that the country has ever undertaken. But continued success requires evolution. There is a huge agenda to pursue beyond the EastMed gas pipeline. Greece should push for a reconceptualization of what the region could do together on energy and climate more broadly. The opportunity is too good to pass up.
Nikos Tsafos (@ntsafos) is the James R. Schlesinger Chair in Energy and Geopolitics at the Center for Strategic and International Studies (CSIS).
