Negotiations for electricity interconnection between Greece and Cyprus

The energy ministers of Greece and Cyprus discussed yesterday the details regarding the implementation of the Great Sea Interconnector project, through which a submarine cable would be installed regarding the transport of electricity between the two states, members of the European Union. Although the project is important for both states, the government in Nicosia continues to maintain uncertainty, as it has not yet resolved, from a regulatory point of view, the realization of this project, a regulation that is the basic precondition for the French company Nexans not to suspend the implementation project, according to the Greek publication New Money. In fact, the Cypriot authorities do not want to invest at this moment in the realization of the interconnector, but want to use the allocations from the state budget to complete other projects in the energy field.

The cited source mentions that the American undersecretary for energy affairs, Jeffrey Pyatt, and Julie Fisher, the American ambassador in Nicosia, claim that through this project Cyprus has an opportunity that should not be missed, given that it is a member state of the European Union that will implement Green Deal, i.e. green energy. However, Greece's energy minister, Theodoros Skylakakis, is unhappy with the way the project is being implemented and has called for the intervention of Nikos Christodoulidis, the president of Cyprus, to move forward with the interconnector cable between the two states. The latter said last week that the authorities in Nicosia will first complete other large projects of strategic importance, the priority being the liquid fuel terminal in the port of Vassiliko.

"Our decision will be based on real data and will not have any ambiguity, constructive or not," Nikos Christodoulidis said, according to the quoted source.

In addition to the realization of the interconnector between the two states, whose fate will be decided at the political level, the government in Athens is concerned about the volatility of electricity prices in the Balkans and in South-Eastern Europe, the Greek publication also says. The developments in these prices during the summer season led Greek Prime Minister Kyriakos Mitsotakis to declare that "something is not working correctly in the European market and we will fight to correct these distortions".

"In the coming days, I will raise the issue through a letter that I will send to the President of the European Commission, about the extreme fluctuations in wholesale electricity prices," said the Greek Prime Minister.

In this sense, the Greek Minister of Energy, Theodoros Skylakakis, announced a common front in Brussels with Romania and Bulgaria, the common goal of the three states being for the EU Executive to recognize the emergence of new crises that increase energy prices, to recognize the European responsibility for the situation that has been created to the detriment of the citizens and the economies of the states of South-Eastern Europe and to find solutions so that the single European market in this area becomes functional.

Theodoros Skylakakis stated: "The problem of high energy prices in South-Eastern Europe is a European problem and joint action is necessary, because we may have differences in energy prices of 500 euros between neighboring states, differences that do not are justified in any way and which show that there is a serious problem affecting the operation of the European electricity system and its connections. The lack of electrical interconnections and the algorithms that control them are the causes for the high prices that consumers pay in South-Eastern Europe".

Greek officials believe they have an obligation to protect household consumers from the volatility of energy prices and say firms can deal with high prices by entering into bilateral contracts (PPAs).