Competitive market to slash electricity bills, EAC says, surprised by EMA demands

The Electricity Authority of Cyprus (EAC) says the aim of all involved in the competitive electricity market was to contribute to the lowest possible price of electricity for all consumers, households and businesses and was thus “surprised” with a list of demands put forward by the Electricity Market Association (EMA).

Independent energy producers on Monday accused the EAC of keeping a chokehold on competitors by placing obstacles in the way of the full opening up of the market.

Replying to the demands, the EAC says it has adopted a completely new way of operation on the basis of international models to guarantee separate operation and logistics, which was a precondition for the independent functioning of the energy market.

On EMA’s proposition that the already licenced current renewable energy projects should be exempt of the obligation to go through the whole licencing procedure for the installation of energy storage systems, the EAC says that all necessary licences were determined and issued according to regulations and laws, which all contributors were obliged to observe.

To the suggestion that the provision for hybrid systems, which stipulates that owners should sign contracts with the EAC, should not apply, the EAC says the aim of the energy ministry’s plan was to slash electricity prices for all consumers, which could only be achieved through the EAC and approved by the Cyprus Energy Regulatory Authority (Cera).

The EAC says the retail price of energy from renewable energy sources depended to a great extent on the contracts between producers and providers.

It adds that EAC Supply buys energy from renewables at 11 cents per kW and incorporates it into the total energy cost, to the benefit of its consumers.

In its press release, the EAC says EMA asks President Nikos Christodoulides to offer countermeasures for the stoppages in the production of electricity from photovoltaics.

These stoppages, the EAC says, are made seasonally during low-demand periods, to secure the stability and safety of the whole energy-producing system.

It adds that the EMA’s proposal would lead to an increase in the cost of electricity.

The solution, the EAC says, would be storage for the excess produced during low-demand periods.

Proposals have already been made for the installation of storage systems from EU funds with zero cost to the consumers, it adds.

To EMA’s demand that Cera gives priority to private investors to invest in conventional plants, such as the one in Dhekelia, the EAC explains that the plant in Dhekelia is the property of the EAC and any plans are implemented by the EAC itself.

It adds that no one is stopping private enterprises from finding their own sites and obtaining permits to develop new conventional plants.

“The EAC clearly and unequivocally reiterates its support to a competitive electricity market, in which the participants will trade freely. The restrictions in closing contracts between producers and suppliers do not work in favour of free competition and increase the cost for the consumers.”

It adds that, as a matter of principle, it has always supported and will continue to support the equal treatment of all participants in the market.

“The aim should be joint: to reduce the price of electricity for the households and businesses of the country,” the EAC says.