EAC hits back at ‘greedy’ private RES providers

Private renewable energy (RES) companies are trying to squeeze the electricity authority (EAC) out of the running, the authority’s board of directors chair, said on Tuesday.

Giorgos Petrou made his statements to the CyBC, in the wake of contrary arguments on Monday by the head of the (private) Electricity Market Association, who said it was the EAC which was keeping a chokehold on its competitors.

Private RES company rep, Fanos Karantonis had said the association objected to actions undertaken by the EAC to “grow its size” and infiltrate the RES market, as this blocked free market competition.

“New entrants should not be stifled to the benefit of the dominant organisation,” Karantonis said, evidently referring to the EAC.

Private RES companies have long objected to the EAC making forays into the renewables’ sector.

The EAC’s Petrou, however, took a different tack over the matter, claiming that RES companies are merely trying to safeguard their enormous profits by trying to keep the EAC out of the running.

Fair competition and an open market would in fact dictate for the EAC to have equal access to land parcels and permits, he argued.

“The private RES sector sells its electricity to business interests, under the guise of offering them a 10 per cent discount on EAC rates,” Petrou explained, when instead they could be shunting the electricity they produce into the EAC grid mix, thereby lowering electricity costs for all consumers.

Cost of [photovoltaic] production is no more than 7 cents per kilowatt, Petrou said, but private companies sell it to businesses for 27 cents per kilowatt.

“They don’t want the EAC to enter the [RES] competition, because they would have to charge less,” he claimed.

Karantonis on Monday argued that since 2021 the private sector and independent suppliers served approximately 9 per cent of consumers, who paid less than EAC customers do.

In his attack on the private PV companies, Petrou further said they demanded outrageously high prices for their electricity when offering to sell it to the EAC–which they could do for as along as pricing was linked to fossil fuel production.

“They make 300 per cent profits, while the EAC’s profits are pegged at 4.6 per cent,” he said.  

Moreover, the RES companies’ requests to be granted fast-tracked permits for energy storage systems on their grounds [rather than in EAC designated areas] was also unfair and improper, he said.

“Battery storage systems are large installations and they require proper handling and procedure,” he said.

The EU had already proposed that RES companies supply their electricity output at a reasonable cost, to be stored in EAC-designated installations, Petrou added.

As for the upgrades to the Dhekelia power station, a topic of heightened concern amid fears of supply sufficiency, highlighted during the recent heatwaves, Petrou revealed that the two new flexible generators, with a total capacity of 80 megawatts which were to be purchased, are still in the tendering process.

Private RES companies have meanwhile also shown interest in taking over the outdated power station nonetheless deemed crucial by experts.

This part of the puzzle is also likely to get mired in potential conflict should the cost of upgrades be borne by all electricity consumers and not just EAC customers, which is what the EAC is pursuing.

Initial information suggests that the EU would take issue with private electricity supply companies (mainly large commercial and industrial consumers) being called to cover any costs relating to the EAC’s new generators.

Private companies would gain from “selling out” the EAC and the [eventual] closure of Dhekelia, Petrou said.

He said the taking over of the power station by private interests was nonsensical.

“Dhekelia can’t be given to five [private] businesses to manage,” he said, adding that the EAC had years of expertise which no other institution in Cyprus could match and, should Dhekelia be privatised, prices would surely go up.

“Putting the EAC out of the running will not result in lower electricity prices,” he said.

“Had the private RES companies put their energy in [to the EAC grid mix] we would already have lower prices,” he maintained.