We read yesterday’s announcement from the Electricity Market Association in response to the parliamentary debate on allowing Cyta to operate in the energy sector, and we must say we detected between the lines an attempt to express concern—even anxiety—yet nowhere does it state clear opposition from private electricity producers to the bill.
Nowhere in the announcement does the association ask MPs to vote against the bill. Are they not frightened by Cyta’s entry into the competitive market? Or are they looking forward to collaborating with it—either to sell their electricity or for some to offload their parks at a good price?
Yet whilst the association is extremely cautious in its announcement, the association’s president, Giorgos Chrysochos, in statements we read in Stockwatch, positioned himself clearly against Cyta’s entry into energy. He said, for example, that “competition with Cyta will not be fair because of the dominant position it holds in the telecommunications sector,” which he claimed “it will use to reap advantages in the electricity sector.”
He added: “In a country where state monopolies become a curse, a player who will have a huge advantage due to their dominant position in another sector—in telecommunications—is now coming to use that position to ensure success.”
It’s clear that Mr Chrysochos, as an investor in energy, doesn’t want serious rivals nipping at his heels—and certainly not the state’s most successful and powerful organisation. And without the regulatory weights shackled to EAC’s feet. It’s logical that he wouldn’t want Cyta in energy, but it would be illogical for us citizens—consumers—to share Mr Chrysochos’s wishes, or those of others in the energy market.
Cyta is obliged by the legislation governing it to act with the public interest and consumer service as its criteria (even in the most remote location), not unbridled profiteering as its main compass. It makes profits—plenty of them—but reinvests a large portion and the state takes another portion as dividends. And in its place, a private organisation would likely demand and make higher profits.
We note the careful phrasing in the Electricity Market Association’s official announcement and the clear disagreement of its president with Cyta’s business activity in electricity. This differentiation may well prove significant and surface soon enough.
We’ll also wait for Cyta to show its hand, so we can learn how it will make its entrance into energy once the bill is approved. From the first months of operation of the so-called competitive electricity market, we’ve seen the concerns of many technocrats vindicated: for many half-hours per 24-hour period, the prices of cheap photovoltaics lock in at the prices of EAC’s expensive engines, and from this impasse—which suits private generation but batters consumer interests—it’s very difficult to escape any time soon.
Within such a market framework, we’ll wait to see how Cyta will manage to achieve the goal its president expressed in Parliament: to provide cheap electricity to the household consumer, whom today’s private renewable energy producers don’t even bother to look at. Cyta will have to play by the same rules as the private producers in the competitive market, and if we exclude the bilateral contracts it can agree outside the exchange, within the day-ahead market its product will also rocket to conventional generation prices. Unless those who promised to monitor the market in its early steps and make changes if they deem it appropriate don’t sit on their hands forever.
And since Cyta is taking this big step—which we all hope will be successful—let the Regulator also permit EAC to make contracts with private producers for the supply of electricity that’s as cheap as possible. Unless the state doesn’t love all its children equally.
