House approves overhaul in Cyprus’ power grid

The Cyprus Transmission System Operator is calling on people and companies who wish to take part in the electricity market to register for training seminars, following the passage of legislation that aims to put an end to state monopoly after years of debate and EU warnings.

A full session in the House of the Republic of Cyprus unanimously passed three bills on Thursday, essentially enabling the opening up of the electricity market to competition after years of endless debate and a final warning from the European Union.

While previous legislation already provided for an open market in the energy sector, which included the possibility of multiple generation and retail supply firms operating in a competitive environment, lack of regulations in the marketplace meant Cyprus Electricity Authority (EAC) held almost 100% of the entire retail supply and over 90% of generating power.

But this week the three successful bills introduced rules for the regulation of the electricity market, the law for the establishment and operation of the Cyprus Energy Regulatory Authority (CERA) and the Law on the Regulation of the natural gas market.

Officials estimate that a new marketplace will be in full swing in about one year from now.

Stakeholders including individuals and companies wishing to take part in the new market place are advised by CTSO to register for practical training seminars and activities, in order to familiarize themselves with the new market concepts and procedures. 

According to the Cyprus News Agency, the first bill introduces a new licensing scheme for the production, transport, distribution, supply, and storage of electricity.

The bill also focuses on consumer protection by safeguarding affordable and transparent prices, open market access, and enabling third parties to access transmission infrastructure, all being prerequisites needed for the country to harmonize national legislation with European Union laws.

CERA operation laws have also been modified in another bill to harmonize national legislation with EU directives, while the third one introduces amendments to legislation in order to comply with the first two bills passed by the House.

Energy Minister Natasa Pilides has welcomed the vote, referring to “the most important reform in the electricity market since Cyprus joined the EU.”

While previous legislation did not make it easy for the energy regime to change over the years, Pilides noted that the three bills now “pave the way for a competitive model in the market.”