Cyprus and Greece have finalised the state-to-state agreement for electrical interconnection after months of negotiations.
Philenews sources indicate that the agreement was signed by the Ministers of Energy, Giorgos Papanastasiou and Theodoros Skylakakis, and has been communicated to the involved parties and relevant authorities of both states.
The agreement was signed a few hours after CERA’s (Cyprus Energy Regulatory Authority) decision yesterday to change the regulatory framework established on July 2, 2024, and effective from January 2023, to meet the requirements of the interconnection implementation body regarding investor acquisition.
The final agreement text informs us that there is an extensive reference to the CERA’s decision and the remaining decisions that Cera and RAAEY (Regulatory Authority for Energy, Waste and Water in Greece) must make to modify the cross-border cost allocation (CBCA).
Specifically, the regulators are committed by the agreement to redefine the cost-sharing as 50-50 between consumers in Cyprus and Greece in case the project is canceled due to an external factor or incident.
The current cost-sharing is 63% for Cyprus and 37% for Greece.
The modification of the CBCA will take place after the Hellenic Parliament passes legislation stating that the additional potential cost for consumers in Greece (13%) will be funded by the Greek government and not directly by electricity consumers.
The Cypriot side’s request for a 50-50 cost-sharing of the potentially higher project cost, above the budgeted 1.94 billion, was not accepted by the Hellenic side and is not included in the agreement.
Regarding Cyprus’s participation in the Great Sea Interconnector’s shareholder structure with 100 million euros, the agreement states that the final investment decision will be taken after the Cypriot government conducts a due diligence study.
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