GSI bound by EU energy directive, says chamber of commerce

A European union directive by which a set percentage of energy used by member state residents must be derived from an interconnected source, means Cyprus must press ahead with the Great Sea Interconnection (GSI) and tie up the project’s loose ends, Cyprus Chamber of Commerce and Industry (Keve) general secretary Marios Tsakkis said on Wednesday.

The ultimate linking up of the Greece-Cyprus electric systems to Israel is also an imperative for the enterprise to “make sense” Tsakkis said.

The Keve rep said the information had been shared during an extended and “productive” meeting with Energy Minister George Papanastasiou on Tuesday, during which the latter presented this item as a further justification of the need to forge ahead with the GSI project.

The EU has set an interconnection target of at least 15 per cent by 2030 to encourage EU countries to link up their installed electricity production capacity.

It is unclear at the time of writing whether this recommendation is a requirement which carries consequences for non-compliance and to what degree it applies equally to island and continental member states.

However, the stipulation is a “significant one, previously unknown to the us” Tsakkis told state broadcaster CyBC.

The minister also confirmed reports that the state had agreed to funding the project for a total of no more than €125 million from the country’s ETS (emissions trading system) fund at instalments of €25 million for five years, Tsakkis said.

The minister assured that this figure was a non-negotiable maximum for which the state could be held liable, regardless of any eventuality, and that consumers would therefore not be burdened by any upfront cost.

Asked about the final leg of the GSI with Israel, Tsakkis said the cost for this would certainly be borne by the Israeli state, however, he could not detail how this would affect the 67/33 per cent cost sharing already determined for Cypriot and Greek consumers by the project provider, Greek independent transmission operator Admie.

The geopolitical significance of the project particularly in regards to its linking up Europe with Israel, was underscored by the energy minister during the meeting, Tsakkis also said.

Director of the president’s press office Victoras Papadopoulos on Tuesday urged patience after media reports and intense reactions from some quarters about imminent GSI decisions, saying that stakeholders were still negotiating.

Energy committee Chairman and MP Kyriakos Hadjiyiannis, who has been vocal about the project’s information gaps from the start, also on Tuesday sent a letter to the President Nikos Christodoulides demanding clarity as to the project’s mode of financing and the state’s intentions.

The letter was signed by the majority of MPs with Disy, Akel and the Greens in agreement with its contents.

Other MP’s however, have called estimates of the risk of the project’s €2 billion cost ballooning “exaggerated” and have urged for speculations and fear-mongering to cease.

They hold that the EU’s willingness to fund the project with an earmarked €657 million should be provide assurance and sufficient proof of the project’s viability and benefit.

It is understood that the extraordinary meeting with MPs which had been expected for Wednesday will not happen, and the discussion will follow set procedures, being brought to the House plenary after cabinet reaches its final decision.