The energy sector in Cyprus is grappling with significant challenges as the cost of electricity is around three times higher than the second most expensive European country, Minister of Energy, Commerce, and Industry, George Papanastasiou, stated on Wednesday.
The Minister delivered this message during his address at the 21st World Conference of Cyprus Diaspora. Papanastasiou underscored that effectively tackling these challenges is vital for the sustainable growth of the economy and for bolstering the nation’s standing in the new energy landscape of Europe and the broader region.
Papanastasiou highlighted that the cost of electricity in Cyprus is notably high, ranging from 35 to 40 cents per kilowatt-hour. In comparison, the cost in the most expensive European country is approximately 15 cents.
He admitted that Cyprus has a considerable journey ahead, referring to ongoing strategic preparations. He outlined upcoming initiatives geared towards lowering electricity costs through the use of natural gas for combustion, thereby rendering electricity more competitive and environmentally sustainable. He emphasised the necessity of integrating natural gas with solar and wind energy within the next three to four years to ensure economic stability.
Minister Papanastasiou also remarked that Turkey is actively working to hinder Cyprus from achieving energy independence. He noted that energy-related challenges are pervasive globally, with the possible exception of the North Sea, and stressed the importance for Cyprus to navigate this situation astutely in order to harness its natural resources effectively.
During his address, the Minister stressed that the energy sector plays a pivotal role in Cyprus’ competitiveness, necessitating a redefinition of the energy strategy to secure affordable electricity and enhance energy supply security. He also pointed out that these objectives are shared by European nations and neighbouring Eastern Mediterranean countries, establishing a conducive operational environment for the development of natural gas fields discovered within Cyprus’ Exclusive Economic Zone (EEZ).
Papanastasiou updated diaspora members about advancements in Cyprus’ EEZ research programme, noting that the next phase for the “Aphrodite” field involves finalising a Development and Production Plan based on a revised proposal submitted in June 2023. He highlighted that ongoing research programs in the licensed areas of Cyprus’ EEZ are anticipated to peak within the next 2-3 years.
In statements to journalists on the sidelines of the event, Minister Papanastasiou elaborated on the initial introduction of natural gas, set to be facilitated through a liquefied natural gas terminal scheduled for completion by June 2024. He additionally underscored Cyprus’ commitment to clean energy and its aim to transition away from coal-based electricity generation by 2050, aligned with the ambitious goals of the EU.
The Minister acknowledged the challenges ahead while also drawing attention to efforts aimed at establishing natural gas and electricity connections with neighbouring countries like Israel and Egypt, as well as Greece. These interconnections are intended to ensure Cyprus’ energy security and seamless integration with the European energy grid.