Greece to Revive Its Economy with Green Energy on Old Prison Island?

The Aegean island Ai Stratis (about 8 hours by sea from Athens), once a place for Greece to send prisoners, will be the center of an economic revival pilot project via clean, green energy according to Greek prime minister George Papandreou.

Transport will get its power from hydrogen and electricity, heating and refrigeration will be from geothermal energy, and about half of the island’s electricity will be from solar and wind energy. The island will also have organic farming.

Papandreou’s plan is to make Greece the “Denmark of the south” and is predicting that focusing on renewable energy development will create over 200,000 jobs and attract 44 billion Euros ($61.53 billion) in investment by 2015.

“Green and clean energy is a different growth model,” Papandreou said during an Oct. 5 speech in Brussels. “I believe that if we invest there, we will boost our economies.”

Ai Stratis, with a population of 250, will be the center of this push, to start at least.

Greece now has new laws in place to try to achieve its clean energy targets for 2020 and grow its economy.

The government pushed through a law this year to reduce the approval time for renewable-energy investments to eight months from three years. It also shortened the time it takes to get authorization from the Greek energy regulator to two months from as long as a year.

The legislation would help Greece achieve an EU target to derive 18 percent of energy consumption from renewable sources by 2020. The share was 8 percent in 2008, according to Eurostat, the Luxembourg-based EU statistics office. In Denmark, the goal is 30 percent, up from 19 percent.

Wind energy in Greece will account for about 83 percent of installed capacity to meet the 2020 targets, data compiled by research firm ICAP Group’s Athens office show.

“Our choice to move from an economy based on consumption and borrowing to a productive model based on green development is of strategic importance for our country and our children,” the 58-year-old Papandreou said last month in a speech in Thessaloniki, Greece’s second-largest city. “It is the main weapon of course against climate change. It is also a lever for change in our society.”

Greenpeace and some leading economists are more skeptical than Greek officials and Papandreou, however.

Greenpeace discussed how the economic crisis has been used an an excuse to not move forward on environmental issues and clean energy.

“Green growth is great, but it has to be driven by overall growth,” University College London and Yale University economics professor Konstantinos Meghir said. “You need to build a future vision for growth and that requires a lot of work.”