Newsroom
A brewing dispute within Cyprus’ government over the Cyprus-Crete electricity interconnection project is turning into a serious political headache just as €25 million is due for disbursement to Greece’s ADMIE, the project operator.
According to Kathimerini's Apostolos Tomaras, Finance Minister Makis Keravnos has publicly refused to approve the release of the first €25 million payment, citing unresolved conditions and concerns about the project’s viability and geopolitical risks. His position clashes sharply with Energy Minister George Papanastasiou, who insists the cable is vital for Cyprus’ energy security and must move forward. Meanwhile, the presidency remains officially neutral but is closely watching the fallout.
Keravnos challenges the presidency’s claim that the €25 million annual payments until 2029 will not hit electricity bills but will be covered by taxpayers instead. He calls that a “false dilemma,” pointing out that the Cyprus Energy Regulatory Authority (CERA) has already approved the first installment. His refusal risks straining Cyprus’ agreements with Greece and the EU, as the country has committed financially to the project under a September 2024 memorandum of understanding.
The rift isn’t new. Since summer 2024, the finance and energy ministries have clashed over the cable’s uncertain outcome amid rising geopolitical tensions, particularly involving Turkey. Energy officials argue the project is a critical EU infrastructure project that must proceed with backing from Greece and Brussels. But Finance warns of heavy financial risks.
The dispute escalated after work east of Crete was temporarily halted, reigniting tensions within the government. Sources close to the Ministry of Finance reveal that refusal to release funds also stems from American expert opinions that deem the project unviable, as well as a European Investment Bank study favoring battery storage over costly cables.
Despite public disagreements, some insiders suggest both ministers share a common goal: to pressure stakeholders and protect Cyprus’ interests, even if it means risking their own political futures. Both Keravnos and Papanastasiou are reportedly prepared to resign if the impasse deepens, signaling the high stakes for the government’s stability.
For now, the presidency is trying to manage the crisis behind the scenes. Officials say no formal government rift exists, viewing the ministers’ opposing stances as tactical moves rather than outright conflict. But diplomatic sources warn Cyprus could face wider complications with Greece and the EU if the dispute isn’t resolved soon.
With €25 million hanging in the balance and the future of the Cyprus-Crete power link uncertain, the tug-of-war between finance and energy ministers is testing the resilience of the government and the island’s energy future.
