Brussels piles on pressure over Greece-Cyprus-Israel electricity cable

By Makis Georghiou

Just when the Greek Energy Minister thought he could take a short August break, after a hectic first 30 days of the Mitsotakis administration, a stern warning from Brussels has exposed the wavering attitude that Athens has chosen by succumbing to pressure from the Chinese-controlled transmission system operator ADMIE over the Attica-Crete subsea electricity cable.

On Monday, ADMIE-subsidiary Ariadni Interconnection opened the first tender bids for the Attica-Crete section of the Israel-Cyprus-Greece interconnector, in defiance of European Commission warnings and probably entangling Greece in a new standoff with Brussels, with the latter obliged to commence infringement procedures.

This prompted Deputy Director-General at the Commission’s DG Energy Klaus-Dieter Borchardt to write to Energy and Environment Minister Kostis Hatzidakis warning the Greek side that if it insists on building the Attica-Crete interconnection as a ‘national’ project, the country would once again be threatened with the risk of losing access to EU funds for trans-European infrastructure projects.

Athens-based Fileleftheros newspaper reported the letter spelt out that if Greece goes it alone and builds the Attica-Crete section of the cable as a ‘national’ project, and not as part of the cross-border EuroAsia Interconnector as the energy regulator RAE unilaterally decided, then other bodies, like the Ariadne Interconnector are not eligible for EU funds and cannot claim a Project of Common Interest (PCI) status.

Borchardt called on Hatzidakis and ADMIE to agree to the technical roadmap that had been proposed in October 2018, to ensure the interoperability of the entire 1,518km cable connecting Israel to Cyprus, and then to Crete and Attica.

He urged the new minister to abandon the previous decision by Syriza and return to the negotiating table with EuroAsia Interconnector, a meeting he said he is willing to facilitate.

“Otherwise, EuroAsia Interconnector will remain the only recognised project promoter of the entire system, and as a PCI is the only body eligible to receive funding from the Connecting Europe Facility,” Borchardt reportedly said.

The project was left in limbo after the previous Syriza government inexplicably changed its mind over the project that PM Alexis Tsipras had publicly endorsed for the past four years and opted to support the Ariadni startup which will burden all Greek consumers by an additional €400 mln and take 12-18 more months to build than the EuroAsia Interconnector that is ready to start immediately.

Ironically, it was the then-opposition deputies of New Democracy who had raised the same arguments, chastising the previous Syriza administration of this about-face that would leave Crete exposed to extreme power shortages, a higher cost on the taxpayer and maintaining the risk of energy isolation of Cyprus.

Last October, Cyprus Energy Minister Yiorgos Lakkotrypis urged his Greek counterpart “to examine the request by the company Euroasia Interconnector Ltd, for the signature of the document with which the Greek government gives its consent to the submission of the application [to the Connecting Europe Facility], so as not to lose the opportunity that exists at this moment, to receive funding from Europe for the electricity interconnection between our countries.”

“The project is important to us because it is the only one that can lift the energy isolation of Cyprus and interconnect the Cyprus market with the European electricity single market.”

Following that, 32 deputies of the then-opposition New Democracy, including the present-day Energy Minister Kostis Hatzidakis, criticised the Syriza government for “denying access to the licensing and financing facilities applicable to major European infrastructure Projects of Common Interest”.

They raised a series of parliamentary questions about the Greek government’s intention to support the Greece-Cyprus-Israel electricity interconnection, whether it would proceed as a PCI, what would happen with the energy efficiency of Crete in the wake of decommissioning outdated diesel power stations, and how the project would be financed without funding from the CEF programme.

All questions remained unanswered, just as the same questions remain unanswered by the present Greek government.

In a parliamentary debate on December 19, 2018, then-MP and present-day Deputy Minister for the Common Agricultural Policy Kostas Skrekas asked the Energy Minister at the time, Giorgos Stathakis, why Syriza had this obsession with the national project and did not want to go for the EU-funded EuroAsia solution?

“What is hidden behind all this, what are you hiding? Greece will lose 300 million [euros] that it does not have today. This is what you have achieved so far.”

In a letter to Hatzidakis last Friday, EuroAsia’s management offered a conciliatory approach, suggesting the suspension and extension of the bid process for both ongoing Ariadni tender competitions “to avoid further confusion, commitments and legal measures with the Project Promoter and the European Commission.”

The letter also called for a resumption of the roadmap “and immediate start of consultations between stakeholders and the European Commission” by setting up a technical committee that will “define the common technical specifications and the best bidding procedure with immediate priority being the implementation of the Crete-Attica section within 2022.”

It also called on RAE to revoke its initial illegal decisions to unilaterally award the Crete-Attica project to the ADMIE subsidiary, Ariadni, concluding that “consultations within the roadmap can be completed in a short time and within September.”

The writer is a columnist on energy, geopolitical and maritime affairs