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The Great Sea interconnector, a €1.9 billion subsea cable linking the electricity grids of Cyprus and Greece, promises significant savings for Cypriot households. Manousos Manousakis, Chairman of the Independent Power Transmission Operator (IPTO), announced that the project could reduce annual electricity bills by €400 for an average household.
Manousakis, alongside IPTO officials, presented an updated Cost and Benefit Analysis (CBA) to Cypriot Minister of Energy George Papanastasiou and technocrats from the Ministries of Energy and Finance. The Cypriot government is considering a €100 million equity investment in the project.
Minister Papanastasiou stated that an independent advisory firm would review the complete study, conducted by Exergia and the National Metsovio Polytechnic, before making a final investment decision. The Ministry plans to launch a tender for this advisory firm.
The CBA explored two scenarios: with and without the interconnector. Manousakis emphasized that with the interconnector, an average household consuming 5 megawatt-hours annually would save at least €400. Consumers will incur a €30 annual charge from 2025 to 2029 to cover construction costs, totaling €150. Despite this, savings would surpass costs from the first year.
Manousakis noted that regulatory authorities should impose the charge from the project's start, asserting that a €30 annual cost for €400 savings should not strain relations with the Cyprus Electricity Regulating Authority (CERA).
An IPTO press release highlighted that the CBA predicts up to 30% annual savings for Cypriot consumers by 2030. The study compared the interconnector's costs with those of installing batteries to store excess renewable energy. Batteries would require €4 billion in capital expenditure versus the interconnector's €1.9 billion, with higher operational costs.
The IPTO concluded that the interconnector would yield a total social benefit of approximately €6 billion, through fuel substitution and emission cost reductions, surpassing its construction cost. The social benefit ratio of the interconnector is about 19%, more than double that of an isolated energy development.
[Information sourced from CNA]
