CYPRUS DOMESTIC ENERGY
A TRANSFORMATION FOR THE CYPRUS POWER SECTOR
NEW RENEWABLE ENERGY TO BE AVAILABLE SOON
Over 300 megawatts of new renewable energy is set to transform the Cyprus power sector in the near future. Now available for trading, this energy currently represents approximately one-third of the average energy demand across the island. This marks a major step towards the country’s energy transition to a more sustainable model. Additionally, the private sector has recently invested over €800 million in renewable energy projects. This has brought the total renewable production capacity in Cyprus to just over 1,000 megawatts.
SEVERAL NEW APPLICATIONS
In light of this, several new applicants have completed procedures to join a new competitive energy market. This new model is expected to begin in the near future across the island, and a total of ten new suppliers are expected to be operational in the near future. The new model will comprise five renewable energy aggregation representatives and five renewable energy producers. This will mark a significant milestone for Cyprus, positioning the country for further investment in renewable energy, supplying direct support for the country’s long-term energy and sustainability goals.
NEW GRANT PROGRAMS
A series of new grant programs to support the installation of storage systems alongside renewable energy projects is also becoming readily available. This follows several other financial incentives already in place aimed at enhancing energy efficiency for large businesses.
ENERGY PRICES IN CYPRUS REMAIN HIGH
A MULTIFACETED ISSUE
The challenge of combating high energy prices in Cyprus has become a multifaceted issue. Energy sector pricing is still heavily influenced by reliance on imports, infrastructural challenges, market dynamics, and geopolitical tensions. In light of this, most government officials are in agreement that addressing these challenges requires strategic investment in renewable energy and infrastructure modernisation across the island at a governmental level.
A SIGNIFICANT CONCERN
Although crucial steps toward achieving energy independence and cost stability for the future have been taken, progress towards this is slow. The whole sector, as a result, is under scrutiny. While energy prices remain high, there is still significant concern for all consumers across Cyprus.
A HEAVY RELIANCE ON IMPORTED FOSSIL FUELS
Cyprus still relies heavily on imported fossil fuels. The absence of substantial natural energy reserves necessitates the importation of several essential commodities, which include gas and fossil fuels. This often subjects the Cypriot economy to global price fluctuations. As international energy prices soar, so too do the costs for Cypriot consumers.
A VOLATILE ENERGY MARKET
Energy infrastructure in Cyprus still presents several challenges. The electricity generation sector on the island still predominantly relies on fossil fuels, which are subject to volatile market conditions. Efforts to diversify energy sources and integrate renewable energy technologies have been slow to materialise, meaning that Cyprus remains vulnerable to external shocks.
LIMITED DOMESTIC COMPETITION
Regulatory and market structures also play a crucial role in this sector. Despite recent reforms aimed at liberalising the energy market, competition remains limited. This lack of competition has created a monopoly, leading to higher prices. As a result, consumers do not have the benefit of switching to and from multiple suppliers, as is the case in other European countries.
ENERGY SECURITY & PRICING
Geopolitical factors and the regional dynamics in the Eastern Mediterranean still affect energy security and pricing. Tensions between neighbouring countries can disrupt supply chains and impact energy availability, further driving up costs.
EFFORTS UNDERWAY TO REDUCE HIGH ENERGY PRICES
A CLOSER EXAMINATION: Recent high energy prices have become a significant concern for both consumers and businesses across Cyprus. Several worrying factors, which are contributing to the overall situation, have been identified, and some of these are now warranting a closer examination of Cypriot energy infrastructure.
A CRUCIAL RESPONSE: Cyprus authorities, in response, are taking crucial steps towards achieving energy independence and cost stability for the future. Their strategy includes employing several strategic investments in renewable energy and modernising the island’s infrastructure. Progress towards achieving cheaper, more reliable energy, however, is proving difficult and slow.
CHEAPER ELECTRICITY FOR CYPRUS
A REDUCTION ON VAT FOR ELECTRICITY
The government has announced a 10% reduction in VAT on electricity for all households. This is part of the ongoing government initiatives to make domestic energy more affordable across the island. This announcement comes alongside several other ongoing tax reform proposals and key measures. Moving forward, the Cypriot government maintains that it remains focused on sustainability and cost reduction in the energy sector.
GREEN COMMUNITY PROJECTS
A new regulatory framework is now in place for communities across the island, intending to boost energy efficiency. The pilot launch of the ‘Green Community project’, in Kato Pyrgos, Tillyria, is one such service. This service, in particular, has overseen new smart meter installations across the whole region. This service, as a whole, has already helped to improve the national electrical grid by boosting energy efficiency across the island.
NEW SMART METERS
A 20 MINUTE INSTALLATION
The mass installation of single-phase electric smart meters for homes and businesses across the island is continuing. The Electricity Authority of Cyprus maintains that although all smart meter installations are free of charge, each installation requires a short interruption of power. This interruption, which is necessary for the safe replacement of each new meter, will usually last no more than 20 minutes.
SEVERAL LONG-TERM BENEFITS
The Electricity Authority of Cyprus, in a joint statement, has stated that the installation of smart meters is necessary to keep all electricity systems on the island up to date. It has also assured the public that the upgrade will offer several long-term benefits, including better energy monitoring and an improved overall service.
WHAT DO ELECTRICITY SMART METERS MEAN FOR CONSUMERS
Smart electricity meters are digital devices that record electricity consumption in real-time. The information that is communicated to both the supplier and consumer is transparent and can be used to provide potential savings. This gives more control to consumers and also offers several important benefits. Although these devices are welcome and allow consumers to monitor electricity use more efficiently, they do, however, also come with data privacy issues. Although rigorously tested, some health concerns have also been raised.
BENEFITS FOR CONSUMERS
- Real-Time Monitoring: Smart meters allow consumers to track electricity consumption instantly. This helps consumers understand how and when most energy is being used.
- Energy Savings: With better awareness, consumers can adjust habits with a view to reducing energy waste, potentially lowering bills.
- Accurate Billing: Smart meters provide precise data on energy use. This helps to reduce billing errors and the need to estimate bills.
- Time-of-Use Rates: Some utilities offer variable pricing based on when electricity is used. Smart meters enable billing based on peak and off-peak times, encouraging off-peak use.
- Faster Service and Outage Detection: Utility companies can identify and respond to outages more quickly, improving service reliability.
- Environmental Impact: Promoting efficient energy use can reduce carbon footprints. This ultimately supports sustainability goals.
FURTHER CONSIDERATIONS & CONCERNS
- Privacy: Smart meters collect detailed usage data that some consumers worry could be misused or lead to privacy breaches.
- Health Concerns: Although extensive research shows they are safe, some individuals have concerns about radiofrequency emissions.
- Cost and Implementation: Some regions may see costs passed on to consumers or experience delays in deployment and infrastructure upgrades.
REDUCING ENERGY COSTS
ENERGY EFFICIENCY
In an era marked by rising energy prices and heightened environmental consciousness, reducing energy costs has become a priority for all consumers. Implementing cost-effective strategies not only contributes to financial savings but also promotes sustainability. Reducing energy costs requires an approach that combines technological investment, behavioural changes, and ongoing evaluation.
ADOPTING NEW STRATEGIES
By adopting certain strategies, all can achieve greater energy efficiency, leading to significant financial and environmental benefits. Reducing energy costs can have a significant impact on the monthly monetary budget and implementing a few simple adjustments can lead to noticeable savings on energy bills.
PRACTICAL TIPS TO HELP SAVE ENERGY & REDUCE MONTHLY COSTS
Energy Audit: A thorough energy audit can identify areas where energy is wasted and improvements in areas of insulation or more efficient appliances, which can significantly reduce energy consumption, should be considered.
Temperature: Setting the thermostat a few degrees lower in winter and slightly higher in summer can make all of the difference to the overall annual cost of energy.
Appliances: Investing in energy Star-certified appliances can lead to substantial savings over time. Appliances that have good ratings use less energy while maintaining performance. This ultimately lowers monthly utility bills saving money in the long term.
Adopt Smart Technology: Smart thermostats and energy management systems allow for precise control over energy use. They will also enable the accurate scheduling of both heating and cooling systems based on occupancy patterns. These new technologies can lead to significant reductions in energy expenditure.
Renewable Energy Sources: Exploring options for solar panels or wind turbines can provide a long-term solution for reducing dependency on traditional energy sources. While initial costs may be high, available incentives and the potential for reduced utility costs make renewable energy an attractive option.
Insulation: Check for drafts around windows and doors and use weather stripping or caulking to seal any gaps. Effective insulation and sealing of windows and doors will prevent heat loss in winter and heat gain in summer. This will ensure that heating and cooling systems will operate more efficiently, whilst significantly reducing energy usage.
Light Bulbs: LED light bulbs are initially more expensive, but they use significantly less energy and last much longer than conventional light bulbs creating notable savings in the long term.
Phantom Energy: Electronics tend to consume energy even when turned off. Power strips will easily turn off multiple devices.
Smart Meters: If available, smart meters will track energy consumption, which can help identify energy patterns and areas for improvement.
Regular Maintenance: Keeping heating and cooling systems well maintained with regular checks, filter changes, and servicing will improve energy efficiency.
Ventilation: Use fans instead of air conditioning when possible.
Timing: Using appliances such as washing machines and dryers during off-peak hours will save on energy costs.
