Holy Desertec: $555B Solar Saharan Project Finds a Dozen Backers

solarthermalgeneric2Ever since the news came out about Desertec, a $555 billion project to build solar thermal plants in Northern Africa’s Sahara desert to funnel solar power to Europe, we’ve been scratching our heads about what to make of it. The sheer size (supposedly large enough to supply up to 15 percent of Europe’s electricity needs), cost and timeline (over 40 years) is so utterly massive and ambitious, the project will no doubt look very different when — and if — it ever makes it to light. But despite the “fantasy” nature of the plan, a dozen serious and respected companies have signed a memorandum of understanding today to investigate how to build the project.

Participants include German engineering company Siemens (s SI), German insurer Munich Re, Deutsche Bank (s DB), German utilities RWE and EON, Spain’s power company Abengoa, Zurich’s electricity grid builder ABB, Algerian firm Cevital, European bank HSH Nordbank, engineering company M+W Zander, and solar firms Schott Solar and Solar Millennium.

The group now has the overwhelming goal of writing up a business plan for a project that will involve hundreds of solar thermal plants and massive underseas high-voltage transmission cables spanning countries. The blueprint of the plan itself will take three years just to develop and incorporate under German law. Some of the German firms already did some feasibility studies to the tune of $1.4 million, says Bloomberg, but of course those initial funds are just a grain of sand in the entire Desertec.

Desertec clearly has high-profile backers that believe in the plan. The Financial Times says that German Chancellor Angela Merkel and EU President José Manuel Barroso are supporting the project, and the dozen companies involved are hoping to cash in on the opportunity. As the Wall Street Journal points out: Siemens makes both solar thermal gear and transmission lines. But if a much smaller energy project like FutureGen has been delayed and morphed to the extent that it’s earned the nickname NeverGen, we’re wondering how such an ambitious and expensive plan like Desertec will avoid becoming a mirage.