Consumers to face high costs if gas arrives late
Consumers in Cyprus could face an astronomical financial burden if the arrival of natural gas for power generation is delayed beyond 2029. Without this fuel source, the country would be forced to activate the “capacity mechanism” following European Union approval to maintain energy adequacy.
High costs and Irish precedent
CERA chief Polyvios Lemonaris cautioned the Parliamentary Commerce Committee that the financial strain would be severe for both the national economy and individual citizens. He pointed to Ireland as an example, where a notable electricity shortfall arose and a temporary mechanism was employed until permanent facilities were finished.
Mr. Lemonaris stressed that “the capacity mechanism has a cost and is not free.” In Ireland, €1.4 billion was disbursed to compensate for an estimated 760 MW deficit, linked to data-center activity, over roughly eighteen months. When Committee Chairman Nikos Georgiou inquired whether consumers should shoulder the entire expense, Lemonaris confirmed that they indeed did.
Emergency plan and worst-case scenarios
Earlier, Lemonaris told the committee that after CERA issued a warning to the Ministry of Energy, Article 34 of the Electricity Market Law Regulation was triggered. This activation clears the path for using the capacity mechanism should an electricity-sufficiency issue arise.
The 2030 adequacy assessment included a worst-case projection in which both natural-gas delivery and the cross-border interconnection are delayed together. Based on that scenario, authorities launched an emergency protocol to address a shortfall of about 720 MW, a gap also created by the planned retirement of conventional units at the Dhekelia plant.
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Authority officials noted that previous studies relied on assumptions of faster interconnection and gas arrival, assumptions that did not materialize. CERA clarified that it does not formulate energy policy, but its studies take into account official state decisions and commitments.
Political response and alternative plans
After the session, Committee Chairman Nikos Georgiou warned that the looming financial pressures threaten consumers. He described Cyprus as being “between a rock and a hard place,” citing rising demand and the narrow window for making decisions.
AKEL deputy Andreas Pasiourtides observed that CERA is essentially flagging electricity-sufficiency concerns beyond 2030. He cited Ireland’s €1.4 billion cost, stressing that the expense will again fall on consumers, and criticised the persistent postponements at Vassilikos and the interconnection project.
DIKO representative Adamos Aspris said guaranteeing energy adequacy from 2030 forward is non-negotiable and urged all stakeholders to devise a viable backup plan, noting the current administration’s effort to rectify historic mistakes. Direct Democracy MP Yiannis Laouris highlighted that the ultimate electricity price for households is the key issue, advocating for smarter management tools and increased public involvement in generation and storage.
