Cyprus activates emergency mechanism for electricity supply stability

The Cyprus Energy Regulatory Authority (CERA) has activated Article 34 of the Electricity Market Regulation Law in cooperation with the Ministry of Energy to establish a capacity mechanism to prevent power shortages. This decision follows an assessment of a worst-case scenario where the introduction of natural gas and the planned electrical interconnection are delayed beyond 2029. By 2030, the retirement of aging units at the Dhekelia power station, which currently provide approximately 720 MW, creates a significant risk of energy deficit.

CERA Chairman Polyvios Lemonaris informed the parliamentary Energy Committee that the mechanism serves as a safety net to avoid power outages. The implementation involves potential costs that will be passed on to consumers. Officials noted that the original targets for natural gas arrival (2022) and electrical interconnection (2021) were missed, necessitating these emergency measures to ensure grid security while transitioning away from polluting power sources.

Looking ahead, CERA is working with the Ministry and the Transmission System Operator to finalize these measures. The authority emphasized that this intervention requires EU approval and carries long-term financial implications for the national economy and household electricity bills, similar to experiences seen in other European jurisdictions.