Energy & Mining

Renewables in Cyprus

Eastern Mediterranean Energy

Cyprus: a “golden-green leaf thrown into the Sea“ and land of “wild weather and volcanoes,“ in the words of the Greek Cypriot poet Leonidas Malenis.

Cyprus: a “golden-green leaf thrown into the Sea” and land of “wild weather and volcanoes,” in the words of the Greek Cypriot poet Leonidas Malenis.

This was how the first settlers of the Mediterranean island of Cyprus described their home, an island which since the beginning of written history has stood as a cultural, linguistic, and historic bridge in Eurasia.

The pearl of Eastern Mediterranean, Cyprus is blessed with fertile lands, endless sun, high mountains, and natural beaches, and its spectacular landscape calls out for preservation.

And one of the most efficient ways to keep its environment safe is by shifting toward renewable energy sources (RES).

Cyprus holds the top position among EU countries in terms of dependence on fossil fuels, an issue which stands as a key challenge for the island.

Currently, a little less than 90% of the country’s energy need is generated from imported fossil fuels and this is equivalent to as much as 8% of the total GDP.

Thanks to the ever-growing tourism industry, the country experienced a massive increase in energy demand.

The challenges for Cyprus are set out in the EU energy policy goals for 2020.

These include the development of indigenous energy resources, the enhancement of security energy supply, and increasing competitiveness and the protection of the environment.

In this regard, Cyprus is obliged to reach a share of 13% of renewable energy in its gross final energy consumption.

It is forecasted that solar thermal systems will contribute the most to the total renewable energy share with 46% by 2020, followed by heating generation through biomass 21%, 13% from electricity production via wind farms, and 8% electricity utilization from PV systems.

Three main sectoral targets were set by the national renewables action plan to achieve 2020 goals: a 23.5% share of renewables in cooling and heating systems, 16% renewables share in electricity production, and biofuels giving a 10% share in transport.

Solar energy offers arguably the greatest potential given that Cyprus is such a sunny nation.

According to Cyprus Renewable Energy Roadmap, the island will be able to produce 25% to 40% of its total electricity via solar power by 2030. Currently-installed solar PV systems generate around 121MW a year, and the goal is to increase this production up to 288MW by 2020.

Government investment will also help increase the share of wind power from 157.5MW to 175MW and biogas from 12.8 MW to 15MW.

The government has already moved into action. In 2013 and 2014, the Ministry of Energy, Commerce and Industry and Tourism announced support schemes to promote electricity generation via solar energy wherein 2,000 photovoltaic systems were initially installed in vulnerable households thanks to government subsidies.

Each of these produced 3KW of electricity and were connected to the grid.

In this system PV owners save up credits for additional electricity, and export excess to the grid which then can be offset against their electricity consumption.

The idea is that the surplus energy generated by the households is not wasted but goes back to the Electricity Authority of Cyprus (EAC) grid where other consumers can access it.

According to stakeholders in this project, the net metering system can reduce electricity bills by up to 80%. After the success of the initial process, a further 3,000 PV systems were installed under the same support scheme.

The Cyprus Energy Regulatory Authority (CERA) has been working on a full liberalization of the energy market which is expected to be finalized by 2021.

The intention is to grant consumers the choice of their suppliers and to encourage renewable energy installation by the private sector for commercial purposes. In this respect, a new scheme was announced in 2017, which was later amended in 2018, to promote the installation of PV systems up to 8MW, wind systems up to 17.5 MW, and biomass utilization systems up to 5MW.

As the EU renewables directive has binding targets, a shortfall of 13% in energy production from renewables could result in massive fines which will be calculated daily. Although the daily fine has yet to be defined, the EU commission has recommended an EUR11,404.80 penalty for each day until the indicated percentage of renewables is reached.

Cyprus seems to understand the binding nature of the EU directive as the government announced that a total of EUR59 million was included in the 2019 budget for energy subsidies, around EUR30 million of which are directly dedicated to producing electricity from renewables.

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