A belated effort by the government to meet its green obligations with the European Union has brought solar energy back on the table after virtually no action was taken by the state to promote Renewable Energy.
For almost a decade since undertaking a set of EU obligations, the state had been idle say Renewable Energy Source (RES) companies and experts.
Cyprus, with its 2004 accession to the EU, took on the obligation to liberalise its energy market from day one but was given a 10-year grace period after a request by the government.
However, 2014 found Cyprus at square one, while essentially nothing was done for the following five years, said Fanos Karantonis, Cyprus association of Renewable Energy Enterprises chief.
He told the Financial Mirror that the government is promoting the creation of solar parks while pushing investors who wish to engage in the energy market to engage in RES projects, aiming to kill two birds with one stone.
He said that the state was idle during the past decade and a half due to political and regulatory reasons. Not wanting to elaborate on the political will of the state, Karantonis said that investors willing to go ahead with RES projects, particularly solar parks, are faced with a wall of red tape.
“Just to acquire a town planning license, an investor has to submit applications to 14 different state departments. This is very frustrating and time-consuming, and in many cases discourages investors,” he said.
Karantonis also stressed that projects are being put back into investor’s drawers as there is a serious lack of financing.
“Cyprus banks are less than willing to finance such projects, leaving investors to seek alternative financing, in many cases bringing funds or investors from abroad. This could mean that a series of projects could be taken over by non-Cypriot companies.”
He added: “Despite all the difficulties faced and the latest efforts by government coming in at the final hour, investors have shown a vigorous interest to invest in RES projects, particularly PV solar parks”.
Karantonis said that 83 out of 203 applications for construction of solar parks filed this year were approved in June and are set to move on to the next stage.
Investor interest was confirmed by the Environmental Department of the Ministry of Agriculture which stressed that there are massive opportunities for investments in the sector.
According to an official, they are currently in the process of examining another 80 applications filed in the past few months.
The official added that five times more applications for big Photovoltaic parks with a capacity of more than 1 MW were filed in 2018 than in the previous year.
She said that the trend is towards bigger solar parks, with some having a capacity of 10 MW that is 8 to 10 times bigger than the parks already in operation today.
Interest is mainly from local investors, with 90% of applications being filed by Cypriot companies. “The interest for solar parks has exploded as many of the companies are filing up to 20 applications for different projects,” said the official.
“There are great prospects in the sector. It is indicative that even the Church has filed in 4 or 5 applications for solar park projects. One of which is a joint venture with the Electricity Authority of Cyprus (EAC) for the construction of a photovoltaic park in Agios Ioannis in Malounda (Nicosia).”
EAC and the Church plan to build the largest photovoltaic system in Cyprus, covering a total area of 1,928,000 sq. m.
The project consists of two phases. During the first phase, two photovoltaic parks with a capacity of up to 8MW each will be installed and during the second phase, a large photovoltaic park with a capacity of about 50MW will be established.
EAC has another application pending examination, this time regarding the construction of a solar park in Akrotiri, Limassol, with a capacity of 20 MW.
One of the local energy companies considering building a solar park is Petrolina. With its subsidiary Petrolina Solar, the group of companies is already active in the field of energy production with Renewable Energy Sources, as the company specialises in installing Photovoltaic systems.
Dinos Lefkaritis, CEO of the Petrolina Group, said that the company is intrigued by the prospects of the sector.
“A solar park is in our future plans, but for the moment we are concentrating on our PV projects,” said Lefkaritis.
He said that nine of Petrolina’s petrol stations are now self-sufficient as far as energy consumption is concerned.
Too little too late
Echoing the arguments that Cyprus had not done its share for the promotion of RES, Green MP Charalambos Theopemptou said that despite investors showing a vivid interest in the field, nothing had been done in previous years to promote projects.
“This will probably result in Cyprus missing all its EU 2020 related targets,” said Theopemptou.
“Under EU 2020 targets, Cyprus should see 13% of energy consumed be a product of RES. We are currently at 9% with things not looking bright as even the new solar parks will take some time to be built and connected to the country’s grid,” he added.
Theopemptou said that Cyprus needs to have 10% of energy consumed in transport being produced using RES, however, the country is performing very low, with only a 2.6% of energy transport is green.
“We have not done anything in previous years to produce energy for transport using RES. We could have been promoting electric cars,” said Theopemptou.
He also noted that even the 2.6% percentage was only achieved because Cyprus is adding biofuel to Diesel used in a large number of Cypriot cars.
Furthermore, Theopemptou said that the country is in danger of failing another EU 2020 target, that of eliminating emissions containing Sulphur.
“If Cyprus had turned to RES, and particularly solar energy which is in abundance on the island, it would have met the target in a greener and cheaper manner. Now the government plans to spend some EUR 60 mln to install filters to remove Sulphur from emissions produced by EAC’s plants,” he argued.
Come 2020, with Cyprus having missed a series of EU targets, the country will have to pay a series of fines.
“Cyprus will also have to resort to the emissions trading system, paying significant amounts,” said the MP, adding that these penalties will be paid by the consumer as taxes imposed on fuel will go up.
