The government aims to solve energy storage within the next 18-24 months so the grid does not reject green energy, said Energy, Commerce and Industry Minister George Papanastasiou.
Addressing a press conference of the Green Energy Group in Nicosia, the minister said the energy system is undergoing complete restructuring, focusing on efforts to operate a competitive electricity market.
He added that 41% of the budgeted resources of the Recovery and Resilience Plan concern the green transition, while the ministry secured €590 mln for 2021-2027.
It will be used mainly to grant financial incentives to households, businesses and public institutions for investments in energy efficiency and RES.
“Due to the small and isolated size of the Cyprus market, RES penetration is particularly difficult, also underlying the absence of storage systems and seasonal demand,” Papanastasiou said.
Cyprus still depends on imported oil products and is vulnerable to oil fluctuations in international markets.
“It is vital to strengthen the security of the country’s energy supply, to ensure the uplift of energy isolation and the operation of the competitive electricity market and the internal natural gas market.”
Some €5.4 mln from the “Cyprus-Tomorrow” programme is for the management system of the competitive electricity market, and a fund of €100 mln for the Euro-Asia Interconnector, the Cyprus-Greece-Israel electrical connection.
And €120 mln has been secured from European funds for the network’s expansion, upgrade and digitisation through smart meters, and €40 mln for energy storage systems.
The minister said his ministry is intensifying the actions for implementing the liquefied natural gas import terminal in Vassiliko and the natural gas supply for power generation through a pipeline from Israel to reduce electricity prices while strengthening the security of the energy supply.
“Natural gas would bring numerous benefits since it would allow independent power producers to operate, creating competition in the electricity market, reducing gas emissions in power generation and offering the necessary flexibility to conventional generation to promote RES further.”
Asked if there is a “Plan B” if Cyprus fails to reach EU climate targets, the minister said the alternative is the purchase of emissions rights from other countries.
“But this should be avoided because the cost will be transferred to consumers.
“The EU targets are very high, and while we may be approaching them in electricity generation, we are still far behind in transport, where measurements also include aviation and shipping.”