Investor concerns may hinder plans for Mediterranean renewables hub – EU Commission

Investor concerns about economic and regulatory instability in the Mediterranean could make it harder to attract the private investment needed to implement the EU’s ambitious plans to turn the region into a renewable energy hub, said Matteo Fumerio, team leader for energy security at the European Commission.

The perception of risk increases financing costs for investors despite the region’s vast solar and wind potential, Fumerio explained during an online conference. “While renewable resources in the region are abundant, investors perceive macroeconomic, currency and regulatory risks, which increases financing costs and causes projects to develop more slowly than we would like.”

The EU presented the “Trans-Mediterranean Renewable Energy and Clean-Tech Cooperation Initiative” (T-med) in early 2026 and is now seeking expressions of interest from investors and project developers. The initiative forms part of the EU’s New Pact for the Mediterranean and aims to strengthen cooperation on renewable energy and clean technologies.

Speakers at the conference stressed that T-med is intended as a toolbox and the Mediterranean can play a key role in increasing Europe’s energy security, but that ambition must now be translated into implementation. Both financing and grid connectivity were highlighted as key challenges.

“The Mediterranean possesses world-class solar and wind potential. The challenge is not generation capacity per se, but system integration, storage, grid resilience and cross-border balancing,” said Stella Hadjiyiannakou, who coordinates the renewable sector at Cyprus’ energy ministry, the country holding the current EU Council presidency. “The Cyprus presidency will work to strengthen EU energy infrastructure and interconnections with the objective of enhancing Europe’s resilience and strategic autonomy in energy security,” she said.