NATO Parliamentary Assembly

MEDITERRANEA N SPECIAL GROUP 166 GSM 03 E rev 1 Original: English

ENERGY AND THE ENVIRONMENT IN THE MEDITERRANEAN REPORT

ARISTOTELIS PAVLIDIS (GREECE) RAPPORTEUR

International Secretariat 11 October 2003

Assembly documents are available on its website, http: //www.nato-pa.int 166 GSM 03 E rev 1 i

CONTENTS

I. INTRODUCTION 1

II. MEDITERRANEAN ENERGY EXPORTS TO THE EUROPEAN UNION: SOURCES AND TRANSPORT INFRASTRUCTURE 1 A. GAS 2 B. OIL 3 C. ELECTRICITY 4

III. MARITIME TRANSPORT OF OIL IN THE MEDITERRANEAN BASIN: ENVIRONMENTAL HAZARDS, REGULATIONS, AND SURVEILLANCE 4

IV. REGIONAL PREPAREDNESS FOR ENVIRONMENTAL CONSEQUENCE MANAGEMENT 6

V. PAST EUROPEAN ENVIRONMENTAL POLICY INITIATIVES IN THE MEDITERRANEAN REGION 7

VI. PROPOSED MEASURES TO PREVENT AND MITIGATE ENVIRONMENTAL DAMAGE 7

VII. CONCLUSION 10 166 GSM 03 E rev 1 1

I. INTRODUCTION

1. The European Union’s dependence on external energy sources is continually increasing. According to the European Commission’s Green Paper on Security of Energy Supply (2000), the EU already imports almost two-thirds of its fossil fuel requirements (oil, gas and coal), which represent 80% of the European Union’s energy consumption. the level of oil and natural gas imports is particularly critical: imported oil is likely to increase from 80% of total EU oil supply in 1997 to 87% in 2010, and gas imports are forecast to rise from 40% today to 66% in 2020.

2. Europe’s growing demand for external energy supplies is likely to place additional pressure on existing supply routes and necessitate the development of new routes, potentially affecting future availability and prices of supplies. Because secure energy supplies depend on a number of international factors - including the willingness of third countries to permit transit, technical and financial resources to create and maintain transit routes and an international framework which creates stable trading conditions - the burgeoning need to transport energy into the EU requires particular emphasis on international political, financial, trade, and technical cooperation.

3. The debate on secure energy supplies is further complicated by a growing awareness of the environmental impact of energy use and transportation. Environmental concerns are particularly acute in the Mediterranean, since a large part of the European market depends on gas from North Africa, the Middle East and Central Asia, and oil imports come mainly from Middle East reserves. Disasters like the Prestige accident in November 2002 have increased the need for new measures to improve safety at sea and combat pollution.

4. After a brief overview of the Euro-Mediterranean energy market, this paper will highlight the potential environmental damages of energy transport in the Mediterranean, then outline past and potential policy measures to protect the regional environment.

II. MEDITERRANEAN ENERGY EXPORTS TO THE EUROPEAN UNION: SOURCES AND TRANSPORT INFRASTRUCTURE

5. The EU’s Mediterranean Partners’ external trade in energy varies considerably between countries. Some, such as Algeria and Egypt, are net energy exporters, others, such as Tunisia and Syria, are in balance, while the remainder - Morocco, Malta, Lebanon, Israel, Jordan, the Palestinian Authority, Cyprus and Turkey - are obliged to import energy sources.

6. In April 2003, the Euro-Mediterranean Energy Forum published the Priorities for 2003-2006 of the Euro-Mediterranean Energy Forum, which focus on three major challenges, including the construction of a fully integrated and interconnected Euro-Mediterranean electricity and natural gas market; the improvement of infrastructure security and safety; and reduction of the risks associated with the carriage of oil and gas by sea in the Mediterranean basin. A programme of priority actions was adopted at the meeting of the Euro-Mediterranean Conference of Energy Ministers in Athens on 21 May 2003. The priorities’ ultimate aim is to set up a triple network, for electricity, gas and oil, forming “rings” around the Mediterranean. To this end, a list of new projects has been identified, with the objective of consolidating the existing networks as well as developing new ones.

7. The following sections will discuss the availability of energy supplies in the Mediterranean Partners, as wells as current and planned methods of transport into Europe.

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A. GAS

8. Of the EU’s four major gas suppliers - Norway, Russia, Algeria and Nigeria – only one is a Mediterranean Partner. According to 2000 figures, the EU imports 12% of its gas from Algeria, which has an export capacity of 39.05 bcm per year, via TransMed (Algeria-Tunisia-Sicily-Italy), and Maghreb-Europe Gas (MEG) (Algeria-Morocco-Spain-Portugal.)

9. Although the EU’s Mediterranean gas imports currently rely exclusively on Algeria, the future demand of an enlarged European Union is likely to require investments totalling many billions of euros to finance the exploration of new gas fields and new pipelines. Europe’s increasing demand for imported natural gas confirms the need for strong political and physical links with North Africa and Russia, and increases the attraction of suitable pipeline links to the Middle East and Central Asia.

10. A number of gas infrastructures already connect the areas of production in the Mediterranean to the centres of consumption in Europe and pass through Mediterranean countries. These include the Maghreb-Europe gas pipeline which originates in Algeria, crosses Morocco and serves Spain and Portugal, and the gas pipeline (also originating in Algeria) which passes through Tunisia and serves Italy. Optimal exploitation of these infrastructures is conditional upon their modernisation as well as the improvement of their energy efficiency and competitive utilisation conditions.

11. The Union participates in the financing of many projects, primarily through the European Investment Bank but also through Community support programmes, including the Trans-European Networks (TEN.) Such contribution underlines the Community’s political backing for the project in question, which makes it easier for private financial support to be secured. However, such support cannot replace the private funding of gas and electricity networks.

12. Plans currently exist to expand EU imports of gas from the Mediterranean region. Libya, a Partnership observer, holds 1313 bcm (billion cubic metres) of known gas resources. As diplomatic relations with Western governments have improved, European gas companies have expressed greater interest in Libyan gas supplies, although Spain’s Enagas is currently Libya’s only European customer. Plans by Agip-ENI and NOC to export large volumes of natural gas to Italy under the West Libyan Development Project are under way. Qatar, which has the third largest natural gas reserves in the world after Russia and Iran, could also be a potential exporter. A gas pipeline to Lebanon exists at present, but a new pipeline is needed from Lebanon to Turkey via Syria. Agip-ENI has also proposed building a 1,500 km (900-mile) pipeline which could transport gas from Egypt, Libya, Tunisia, and Algeria into Morocco and through an existing pipeline into Spain.

13. Other projects identified in the Priorities for 2003-2006 of the Euro-Mediterranean Energy Forum as being of common interest for the convergence of Euro Mediterranean markets include: links between France and Spain to Algeria, creating a second “Medgaz"; links between Algeria to Italy and France through Sardinia and possibly Corsica; an EU-Arab gas link in five parts (Egypt-Jordan; Syria; Lebanon; Cyprus and Turkey), necessitating an agreement between the participants; supply to the enlarged European Union, and in particular the Baltic region, of LNG from Egypt and Algeria; three gas interconnections in the South European and East Mediterranean basin region enabling the transportation of gas originating from the Caspian and Middle East regions to transit Turkey and reach the EU; and a Libya-Egypt-Tunisia gas interconnection to complete the Mediterranean gas ring. 166 GSM 03 E rev 1 3

14. Some of these projects are already under way. In February 2003, an agreement was reached between Greece and Turkey on the interconnection of their gas networks. This interconnection is of strategic importance, particularly with a view to diversifying the EU's gas supplies and accessing the resources of the Caspian Sea basin and Egypt via off-shore (Cyprus-Turkey) or on-shore (Jordan-Syria-Lebanon) routes. In addition, it is strategically important in terms of its extension to Italy, which already receives supplies of gas from Algeria and Russia and will shortly also be supplied from Libya. The planned pipeline is intended be completed by the end of 2006.

B. OIL

15. Europe currently imports around 80% of its oil, primarily from OPEC States. Political issues are thus of major importance for many oil routes. In the Middle East, for example, until the end of 1995 every one of eight petroleum pipelines in the region was shut down at least once since the first was built in 1931, in many cases for political reasons. Cooperation with Iran and Libya, both important potential regional trading partners, has also been complicated by political considerations. The course of reconstruction efforts in Iraq and future export agreements will also affect the concentration of regional oil (and gas) exports, as Iraq holds more than 112 billion barrels of oil reserves and 3,113 bcm (plus approximately. 4,245 bcm in probable reserves) of gas reserves.

16. Of the twelve Mediterranean partners, Libya, Algeria, and Syria currently supply the most significant amounts of EU oil. Libya, which supplies 9% of EU oil imports, possesses 29.5 billion barrels of known resources and is connected to the Mediterranean terminals by an extensive network of pipelines. Libya’s major expansion plan is the development of the el-Bouri offshore oil field, the largest producing oil field in the Mediterranean. Algeria holds 9.2 billion barrels of known resources and makes up 3% of EU imports. Algerian oil is considered to be under-explored, and proven oil estimates are expected to be revised upwards following recent oil discoveries and plans to increase production capacity. Approximately 75% of Algeria’s crude oil exports go to Western Europe (Italy is the main market, followed by Germany and France, then the Netherlands, Spain and UK.) Finally, Syria, which also supplies 3% of EU imports, possesses 2.5 billion barrels of known resources. Despite a broad pipeline system, oil output and production is declining continuously due to technological problems, depletion of oil reserves and low oil prices. Without significant new discoveries in the next few years, some believe that Syria could become a net oil importer in the next 10 years. In July 1998 Syria and Iraq reached an agreement on reopening the IPC pipeline, linking the Kirkuk oil fields in northern Iraq with Syria’s port of Banias on the Mediterranean. In early March 2000 both the Iraqi and Syrian sections of the pipeline were ready for operation, and Syria was using parts of it to transport its own crude oil to Mediterranean terminals.

17. Oil transport within the region also carries environmental implications. Seaborne trade in petroleum products and derivatives between the EU and the twelve Mediterranean Partners (imports/exports) amounted to about 63 million tons in 2001. If, more generally, all petroleum products and derivatives which pass in transit through the Euro-Mediterranean region are included, the figure rises to 395 million tons, carried by some 800 oil tankers. This is particularly intensive traffic for an enclosed sea, environmentally highly fragile and with no point more than 400 kilometres from the coast. Because surface waters need at least 100 years to be exchanged, the repercussions of an Erika or Prestige type accident would be catastrophic. 166 GSM 03 E rev 1 4

18. In the Bosphorus Strait, the carriage of oil by sea through the Black Sea has increased significantly after the break-up of the former Soviet Union and the resulting development of the resources of the Caspian Sea basin. Figures for 2002 indicate that a total of 122 million tons of oil were carried through the Bosphorus in 7400 tankers. Partners will therefore support the development of hydrocarbon land transport projects such as the Burgas-Alexandroupolis and the Constantza-Trieste oil pipelines. The Baku-Tbilisi-Ceyhan pipeline project, under construction, will also contribute to relieving maritime oil transport in this region. With regard to other Mediterranean choke points, such as the strait of Gibraltar, other oil pipelines could be envisaged in order to supply the Euro-Mediterranean oil market with resources from Algeria, Libya and Syria as well as from Saudi Arabia and Iraq (with transit through Egypt, Turkey, Lebanon and Morocco). 166 GSM 03 E rev 1 5

C. ELECTRICITY 166 GSM 03 E rev 1 6

19. The volume of exchange of electricity between the EU/Accession countries and their Mediterranean neighbours remains relatively small – under 5% of EU consumption. The Euro-Mediterranean Partnership’s objective, highlighted in the Priorities for 2003-2006 of the Euro-Mediterranean Energy Forum, is to promote a secure regional electricity market which can be progressively integrated into the EU internal market. This project will require reliable and diversified energy links, necessitating the development of the Mediterranean Electricity ring linking all the countries of the Euro-Med process. One early step will need to be the harmonisation of the already integrated electricity interconnections in the Maghreb with those on the northern shore of the Mediterranean. Additionally, the Euro-Med Energy Forum in April 2003 identified the need to upgrade the Maghreb and Mashrek subrings, to develop a New South-North interconnection, including an Algeria-Spain interconnection and Italy-Tunisia interconnection, and to extend integration between the Euro-Mediterranean electricity markets and the south-eastern European market (currently being developed.)

III. MARITIME TRANSPORT OF OIL IN THE MEDITERRANEAN BASIN: ENVIRONMENTAL HAZARDS, REGULATIONS AND SURVEILLANCE

20. The movement of energy – particularly oil – in the Mediterranean basin raises a number of environmental issues. Given the high levels of regional maritime oil transport and the continued operation of several aging tankers in the region, the dangers of a major oil spill in the region are significant. Out of 268 accidents listed by the Regional Marine Pollution Emergency Response Centre for the Mediterranean Sea (REMPEC) for the period 1977-1995, more than three-quarters involved oil. The number of accidents is increasing in the Mediterranean Sea, with 81 events in recent five years (1991-1995) compared to 99 events in the previous ten years (1981-1990) (MAP/REMPEC, 1996). Between 1987 and the end of 1996 an estimated 22,223 tons of oil went into the Mediterranean as the result of shipping incidents. The increasing consumption of oil in Europe makes the risk of disaster even more likely in the coming years. A spill similar to the November 2002 Prestige accident - in which a 26-year-old single-hull tanker carrying 77,000 tons of heavy fuel oil sprang a leak off the coast of Galicia and ruined more than 800 km of Spanish coast - could have considerable repercussions for Mediterranean coastlines and vital tourism and fishing industries. In a country such as Greece, with 15,000 kilometres of coastline and a tourism industry accounting for 15% of GDP, the toll of such an event could be catastrophic. The same applies to other countries, such as Spain and Italy.

21. Illegal discharges, which make up a greater percentage of oil pollution than shipping accidents, are also a major source of environmental damage. The most common pollution is degasification, which consists of cleaning oils and fuel oils from the tanks of a ship by discharging polluted water into the sea. In 1999, researchers detected 660 fresh spills – both accidental and intentional - through satellite technology. Ships practising degasification are difficult to sue because of a lack of evidence – although satellites can be used to locate hydrocarbon spills, it is nearly impossible to identify a guilty ship accurately.

22. The International Convention for the Prevention of Pollution from Shipping (MARPOL 1973/78) is the primary international convention covering prevention of pollution of the marine environment by ships from operational or accidental causes. By July 2002 the Convention had been ratified by 108 states, corresponding to 89 % of world tonnage. The Convention governs the design and equipment of ships, establishes systems of certificates and inspections, and requires states to provide reception facilities for the disposal of oily waste and chemicals. It also covers all the technical aspects of pollution from ships, except the disposal of waste into the sea by dumping, and applies to all types of ships. The Convention regulates the kind and quantities of polluting substances that ships may discharge into the sea. All countries of the Mediterranean Dialogue are part of this Convention, except Jordan. 166 GSM 03 E rev 1 7

23. After the Erika disaster on 12 December 1999, the European Union reinforced its legislation to combat flags of convenience and provide Europe with better protection against the risks of accidental oil spills. Two sets of legislative proposals were tabled by the Commission: the Erika I package (March 2000) and the Erika II package (December 2000). These packages had two objectives: to tighten existing legislation on port state control and on monitoring the classification of companies and also to propose new measures to speed up the phasing-out of single-hull oil tankers, improve controls on shipping in European waters, establish a European Maritime Safety Agency and create a supplementary fund for compensation for oil pollution damage (COPE fund).

24. The European Commission adopted several measures to accelerate the implementation of the Erika packages in the months following the Prestige accident. The Commission published an indicative "black list" of ships that would have been banned from European ports had new Community maritime safety measures been in force during the period in question. It also speeded up the establishment of the European Maritime Safety Agency, which held its first meeting in Brussels on 4 December 2002, six months earlier than planned. Furthermore, in December 2002, the Commission adopted a proposal for a regulation aimed at speeding up the timetable for phasing out single-hull oil tankers adopted in the framework of Erika I, and banning the transport of heavy fuel oil in single-hull tankers bound for or leaving EU ports. In March 2003, the Commission adopted a proposal for a Directive introducing into Community law the international rules concerning discharges of polluting substances from oil tankers and other vessels, and providing that infringements of the rules concerning discharges will be criminal offences.

25. Most recently, on 3 April 2003, the French Parliament adopted a law creating an ecology-protecting zone for the Mediterranean Sea, on the model of the exclusive economic zone. This zone will extend French maritime sovereignty beyond the territorial water (12 miles) to reach 200 miles out from the French coast, in order to combat pollution more effectively, as French Courts will be able to try pollution offences committed in this zone. Additionally, criminal sanctions will be strengthened: people found guilty of illegal discharges at sea will risk 4 years’ imprisonment and a financial penalty of 600,000 euros.

26. Discharges of oil are also prohibited in the North Sea, Baltic Sea and Mediterranean Sea by the International Maritime Organization, which has designated them “special areas.” Oil tankers are normally permitted to discharge oil or oily mixtures at the rate of 30 litres per nautical mile, but in “special areas” the permitted oil content of discharges is less than 15 parts per million (ppm). Studies have shown that a visible trace of oil on the sea surface is an indication that the oil content of the effluent exceeds 15 ppm.

27. Aerial surveillance programmes are conducted in order to prevent and detect any violation of these regulations from ships and offshore oil platforms. Under the Bonn Agreement and the Helcom Convention, specific aerial surveillance is conducted over the Baltic Sea and North Sea. No aerial surveillance is yet in place for the Black Sea and the Mediterranean Sea, but there are indications that these areas are heavily polluted by illegal oil discharges. France and Italy operate aerial surveillance planes in their Mediterranean areas of responsibility, which reveal that hydrocarbon pollution in the French and Italian Mediterranean areas of responsibility exceeds 200 slicks per year. Greece and Turkey are in the process of purchasing surveillance planes. There is no other report for the Mediterranean Sea, where there are about 40 oil-related sites (pipeline terminals, refineries, offshore platforms, etc.) REMPEC intends to develop plans for aerial surveillance in the Mediterranean within the framework of the Barcelona Convention. 166 GSM 03 E rev 1 8

IV. REGIONAL PREPAREDNESS FOR ENVIRONMENTAL CONSEQUENCE MANAGEMENT

28. The recent case of the Prestige accident underlined the various national and international mechanisms that can be called upon to manage the repercussions of a major oil spill. The event required a major offshore clean-up effort which used the maritime resources of Spain and nine other European countries. In the framework of the Biscaye Plan, which binds France and Spain through the maritime prefecture of the Atlantic and SASEMAR, France immediately sent two antipollution ships to the site of the wreck. These two rapid arrivals confirmed the importance of bilateral agreements of mutual assistance. To combat pollution, the European Union activated its special cooperation mechanism - a multilateral system of mutual assistance managed by the Directorate-General (Environment) of the European Commission. Resources and equipment from several Member States for mapping oil slicks and treating and recovering oil were mobilised for the clean-up operation.

29. National attempts by Spain to reduce the effects of the massive aftermath of the Prestige were less effective than anticipated. Early in the response, Spanish shoreline clean-up was primarily limited to manual efforts by military units, fishery associations and civilian volunteers. A number of pumping stations were put into operation on the foreshore where bulk oil had collected in accessible points, though as the oil weathered pumping became increasingly difficult. Spanish authorities also imposed an extensive fishing ban, prohibiting virtually all fishing along about 90% of the Galician coastline and extending 8 miles offshore.

30. The French national response, though more limited, was somewhat more successful. After the accident, the French government set up emergency measures to face the risks of pollution by hydrocarbons. The POLMAR-sea plan, initiated on December 3, manages responses to accidental maritime pollution by coordinating the mobilisation of both public and private resources. In south-west departments, a POLMAR-land plan aimed at protecting the immediate littoral from the effects of maritime pollution was also launched in early December. Beaches were gradually reopened to the public in March.

31. In the case of a major spill in the Mediterranean region, both international and national responses would need to be activated. All Partner countries except Mauritania currently have national contingency plans determining the levels of emergency and responsible authorities and have adopted response policies regarding oil recovery.

32. Most Mediterranean countries are also part of regional or bilateral response agreements - for example, Egypt has signed a trilateral agreement and sub-regional contingency plan with Israel and Cyprus. Mauritania is part of the 1981 Abidjan Convention for Co-operation in the Protection and Development of the Marine and Coastal Environment for the West and Central African Region. Algeria, Egypt, Israel, Morocco and Tunisia are all parties to the Barcelona Convention for the Protection of the Marine Environment and the Coastal Region of the Mediterranean (1976/95).

33. Except for Jordan, all Mediterranean countries are also parties to the International Convention on Oil Pollution Preparedness, Response and Co-operation (OPRC), which was adopted in November 1990 and is designed to help Governments combat major oil pollution incidents. The Convention, which became international law in May 1995, is designed to facilitate international cooperation and mutual assistance in preparing for and responding to a major oil pollution incident and to encourage States to develop and maintain an adequate capability to deal with oil pollution emergencies. IMO, in co-operation with the United Nations Environment Programme (UNEP), has established a centre in Malta to co-ordinate anti-pollution activities in the Mediterranean (REMPEC).

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V. PAST EUROPEAN ENVIRONMENTAL POLICY INITIATIVES IN THE MEDITERRANEAN REGION

34. Assistance in pollution prevention and control has also been provided by the Mediterranean’s European neighbours. In 1975, the Mediterranean countries and the EEC adopted the Mediterranean Action Plan (MAP) and in 1976 the Barcelona Convention which was revised in 1995 (see par. 32). The MED POL programme, a major component of MAP, has played a leading role in upgrading the technical capabilities of most Mediterranean countries and in developing and maintaining national monitoring programmes. MED POL has now entered its third phase, shifting emphasis from pollution assessment to pollution control by means of action plans, programmes and measures for the prevention and control of pollution, for the mitigation of its impacts and for the restoration of systems already damaged by pollution.

35. The MEDA programme, the EU’s principal financial instrument for the implementation of the Euro-Mediterranean Partnership, has also taken a role in regional environmental protection policy. A package of regional projects on sea transport, approved in 1997, supports technical and safety progress - in particular, port information systems, hydrographical studies, research and training, statistics, port management, dangerous goods and waste collection, maritime administration and flag state policy. Overall, the mid-term balance of these actions is modest, given their size (microprojects) and scope (ad hoc measures lacking overall coherence.) MEDA’s Short and Medium-term Priority Environmental Action Programme (SMAP), also adopted in 1997, includes projects related to the establishment of port reception facilities for treatment of liquid and solid waste generated by ships, as well as development and implementation of national and sub-regional plans to combat accidental oil spills from ships.

VI. PROPOSED MEASURES TO PREVENT AND MITIGATE ENVIRONMENTAL DAMAGE

36. There are a number of policy measures under consideration that could support the advancement of laws and technologies beneficial to environmental protection efforts. At the May 2003 Euro-Mediterranean Energy Conference in Athens, for example, Ministers confirmed the importance of reducing maritime transport of hydrocarbons in the Mediterranean by developing oil pipelines if these are shown to be technically, economically and environmentally feasible.

37. Further development of double-hull technology for tankers for the transport of oil and oil products also merits further exploration, although some, such as Efthimios Mitropoulos, the new Secretary General of the IMO, are not convinced at present of its utility in protecting the environment. The results of an analysis on this subject will be presented at the Ministerial Conference “Promotion of Investment and Financing of Infrastructures” in Rome in December 2003. On 20 December 2002, the European Commission proposed that the European Parliament and the Council should amend the existing Regulation by speeding up and extending the ban on single-hull oil tankers. At the Transport council of 27 March 2003, Ministers agreed on the draft regulation proposed by the Commission.

38. The construction of an integrated and interconnected energy market ensuring security of supply, competitiveness and environmental protection is inconceivable without close collaboration between European companies and companies of the Mediterranean Partners. The cooperation could cover a wide range of issues such as technologies in the field of identifying resources and improving their recovery; the transport and storage of hydrocarbons; network security, safety and reliability; and the development of renewable energy sources. 166 GSM 03 E rev 1 10

39. Such investments require high levels of financial support from the EU and the countries participating in the Euro-Mediterranean Partnership. Studies will be carried out in collaboration with the EIB and other financial instruments such as the MEDA programme, focusing on the development of new financial products or of products currently not freely available, such as participating or conditional loans, subordinated loans or guarantee funds. In addition, it is also important to remember that successful financial support will be contingent upon a legal framework conducive to private investment in the Mediterranean countries. Lastly, all the private and public sources of financing available should be utilised and combined in order to help companies on the southern shores of the Mediterranean to participate in energy projects of common interest, in particular through the EIB and the FEMIP (Facility for Euro-Mediterranean Investment and Partnership, launched in October 2002).

40. Another important avenue to explore in the near future is the development of sustainable energy systems which can lead to increased security and diversity in energy supply. Alternative energy sources could provide Europe with high-quality, low-cost energy services, improve industrial competitiveness and reduce environmental impact. Several technologies already exist, such as wind energy, small-scale hydropower, energy from biomass, solar thermal applications, or photovoltaic technology (silicon module panels directly generating electricity from the sun’s light rather than heat).

41. In addition to existing EU programs in the area of energy efficiency (SAVE, ALTENER) regional cooperation should also be stepped up. Based on the proven reserves of oil and gas in the Mediterranean basin, it is likely that the Mediterranean region will change to a net importer in 2020 from a net exporter at present. Natural gas will partially replace oil, mainly for electricity generation, but the region has significant renewable energy sources potential which could be exploited substantially (hydroelectric plants, wind plants, geothermal and solar systems). Future cooperation could focus on increasing the use of renewable energy sources; carrying out studies on the potential and requirements for introducing or extending their use; increasing the use of clean and environmentally-friendly technologies; establishing new and specific funding mechanisms to promote the use of renewable energy sources.

42. Efforts to promote new and renewable energy sources have been lukewarm so far, and still represent only 6 % of the EU's energy balance. On present trends they will account for only 9 % of total European consumption by 2030. For years, however, some Partner countries such as Cyprus, Jordan, Israel and Palestine have relied heavily on solar water heating panels for domestic use. Greece is following suit, building one of the largest solar plants in the world on the island of Crete and enacting a law that would prohibit people from using anything but solar power to heat their water. Greece has also implemented incentive systems to increase market penetration of renewables and co-generation, providing grants for investments in power generation and tax deductions for using solar heating systems.

43. Finally, the technological capabilities provided by Galileo, the European satellite navigation system, could be used to make the Mediterranean safer and better protected, as it has certain applications concerning the safety of ships, the security of ports, and the monitoring of goods and tankers. Galileo entered the developmental phase at the beginning of 2001, and the program will be fully operational in 2008. 166 GSM 03 E rev 1 11

44. Mediterranean Partners and their businesses might be encouraged to become involved in the Galileo project, which offers interesting applications in the construction and maintenance of energy infrastructure (gas pipelines, oil pipelines, storage facilities, high-voltage lines), the monitoring of tankers at sea, and of lorries and tanker wagons transporting hazardous products. The establishment of an EU-Russia Observation System is already foreseen in the context of the EU-Russia Energy Dialogue. Such a system could also be established in the Mediterranean and South-East Europe with a view to being networked into the European Observatory for oil and gas supply.

45. There has also been an impetus towards strengthening European law outlining environmental liability. On 23 January 2002, the Commission proposed a Directive “on environmental liability with regard to the prevention and remedying of environmental damage.” This proposal introduces a detailed liability scheme, which will not only require compensation for damage to the environment, in accordance with the “polluter pays” principle, but will also prevent such damage, by making operators financially responsible for the necessary preventive and remedial measures. After months of debate and arduous negotiation, a compromise text was found at the June 2003 Environment Council. The liability will cover a broad range of damages and imminent threats to the environment resulting from polluting activities (inter alia, energy industries, production and processing of metals, mineral industry, chemical industry, waste management), as well as damages to biodiversity caused by other activities through the fault or negligence of the operator. The text establishes a system of financial guarantees for companies, as well as a subsidiary State liability, in the event of lack of resources or insolvency of the operator responsible for the damage or when it is impossible to identify him. The adoption of a Common Position and a second reading in the European Parliament are likely to occur at the end of 2003 or the beginning of 2004.

46. Along with its delineation of environmental responsibility, the Commission has proposed a Directive introducing criminal sanctions penalising pollution violations. The provisions of this proposal fill a major legal vacuum, since at present, when discharges from ships are concerned, maritime law is not dissuasive enough to avoid dangerous or illegal practices in the transport of polluting substances, including chemicals. The proposal covers illegal discharges in Community coastal waters, but will also include the high seas. Though sanctions will usually take the form of financial penalties, they can also include imprisonment in the most serious cases when individuals are involved. At the Transport Council of 27 March 2003, Ministers welcomed the proposal, but no decision has yet been adopted.

47. The Mediterranean Partners are also currently discussing the possibility of extending the principles and arrangements of the “Erika packages” and “Prestige measures” to the whole Euro-Mediterranean area. This process, which was launched two years ago, will culminate at the end of 2003 in a new regional project within the framework of the MEDA Programme. Such a project should be coordinated with the main players in the sector at international and regional level (IMO, REMPEC), and with the other activities developed as part of cooperation in the justice, immigration and customs sectors.

48. Ultimately, in order to defend its interests at international level, the EU will need to be able to make its voice properly heard in the relevant international bodies, particularly the International Maritime Organisation (IMO), in which the EU has observer status only at present. The status of full member would better reflect the extent of its powers in the field of maritime safety and its role as a driving force within the IMO. The Commission recently asked the Council for a negotiating mandate to this end. 166 GSM 03 E rev 1 12

VII. CONCLUSION

49. The ratification and successful implementation of laws and policies strengthening protection of the Mediterranean from accidental oil spills will be essential to the future ecological – and in many cases economic - welfare of the region. Although not a comprehensive list, the following legal and technological measures are likely to assist in environmental protection:

 Further exploration of double-hull technology for oil tankers  Strengthened EU-Mediterranean financial and technical co-operation on projects of common environmental interest  Development of sustainable alternative energy systems and EU-Mediterranean coordination in energy efficiency efforts  Exploration of the opportunities provided by the Galileo satellite to monitor environmental safety  Support for Commission proposals to delineate legal responsibility for environmental crimes and impose criminal sanctions on those responsible for pollution  Extension of the principles and arrangements of the “Erika packages” and “Prestige measures” to the entire Euro-Mediterranean area  Strengthening of EU influence in international institutions such as the IMO

50. The support of parliamentarians will be crucial in promoting these objectives and advancing efforts towards environmental protection of the Mediterranean region, both within national governments and through international fora such as the NATO Parliamentary Assembly.

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