German energy U-turn powers EU Saharan dream
* EU 'projects of common interest' could get funding
* EU money could lure more private money into project bonds
* Desert economics not proven yet
By Barbara Lewis and Christoph Steitz
BRUSSELS/FRANKFURT, July 29 (Reuters) - Germany's decision to abandon nuclear energy and dwindling domestic subsidies for renewables have stoked a dazzlingly ambitious plan to expand Europe's energy market into North Africa, with an array of giant solar and wind plants glinting in the desert sun.
Desertec, a German consortium set up in 2009, envisages Europe will import up to a fifth of its electricity from solar and wind parks in North Africa and the Middle East by 2050.
Spread over 6,500 square miles - more than half the size of Belgium - Desertec's projected delivery of 1,064 terawatt hours (TWh) would be almost enough energy to power the whole of Germany for two years.
With a projected budget of 400 billion euros ($492 billion), it has been dismissed as too expensive, too risky and too big. The upheaval of the Arab Spring, the revolutionary wave of popular protests and uprisings that began first in Tunisia in late 2010, has added to the doubts.
Business leaders say the economics are not compelling yet, but some say technological advances and judicious use of EU money could change that.
The European Commission, the EU's executive arm, has raised the prospect of financial, legal and practical support.
"A vision can be more concrete than just a dream. It can be a political vision," said Michael Koehler, head of cabinet in the EU's Energy Commission. "Trade in renewables between Northern Africa and Europe is longer just a dream. It is declared EU policy."
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