Every major energy project meant to bring down electricity costs in Cyprus has ground to a halt — the Vasilikos LNG terminal is frozen by legal disputes, the Greece-Cyprus electrical interconnector is mired in disagreement and Siemens has just told the state power utility it cannot deliver three new generators on time.
Dhekelia generators delayed to 2030
Electricity Authority of Cyprus (EAC) board chairman Giorgos Petrou told the parliamentary Finance Committee, during a debate on the authority’s 2026 budget, that Siemens had written saying it could not meet its original commitment to deliver three new generation units for the Dhekelia power station within two and a half years. The company said it would instead need four years, pushing delivery to 2030. The EAC had awarded a €140 million contract for the units, which would run on diesel but are more flexible and reliable than existing equipment and would also stabilise operations at the Vasilikos station.
Petrou blamed the delay on surging global demand for power generation equipment and the absorption of manufacturing capacity by data centres in the United States.
The setback raises immediate concerns about 2029, when fuel-oil units at Dhekelia are due to be retired. Without the new generators there will be a capacity gap, Petrou warned, adding that he hopes natural gas will reach Cyprus by then.
The EAC board met Energy Minister Michalis Damianos to brief him on the development and the authority is now reviewing its plans, the chairman told MPs. He said the EAC has not ruled out scrapping the purchase entirely.
Storage infrastructure at Dhekelia is expected to come online in August 2027 after a tender was recently awarded at €40 million, but questions remain over the EAC’s contingency plan if the three units are not installed, since storage will not be delivered immediately either.
Vasilikos LNG terminal frozen
The liquefied natural gas import terminal at Vasilikos remains at a standstill. The European Public Prosecutor’s Office has widened its investigation into the management of EU funds linked to the project, and since that intervention nothing has moved forward. Legal proceedings and arbitration in London are also under way.
French firm Technip, which was hired to advise the state on further planning of the terminal, has requested a six-month extension, Petrou said. The company completed stage one of its work but asked for additional time on stage two. The EAC, which holds a 30 per cent stake in ETYFA, the state natural gas company, will assign specialists to help speed up the Vasilikos process, the chairman said.
The parliamentary Energy Committee is set to scrutinise ETYFA’s confidential data on spending on legal and other consultants today.
Greece-Cyprus interconnector in doubt
The third pillar of Cyprus’s energy strategy — the GSI electricity interconnector with Greece — is equally stuck. The first €25 million instalment has not been paid to Greece’s IPTO grid operator and the two governments have yet to agree on a formula for commissioning updated techno-economic studies.
Read more: