EAC to pay €183m for CO2 emissions this year

For this year the state-run power corporation estimates it will spend €183 million on purchasing greenhouse gas emissions allowances, while the cost of fuel purchases is projected at €485 million.

The numbers came up Monday at the House finance committee, reviewing the 2022 budget of the Electricity Authority of Cyprus (EAC) – a semi-governmental organisation.

According to the EAC, its emissions during 2022 will come to an estimated 2.96 million tonnes of carbon dioxide.

The entity has budgeted €183 million for the purchase of greenhouse gas emissions allowances – based on October 2021 prices where one allowance went for €62. By comparison, the EAC’s 2021 budget provided for €72.9 million for the allowances.

Meanwhile the Republic’s revenues from auctioning these allowances for 2021 stand at €120 million.

Since 2020, EU member-states are not allowed any free greenhouse gas emissions allowances and must buy them all.

The EAC anticipates that its CO2 emissions will drop by 25-30 per cent with the advent of natural gas, replacing heavy fuel oil in electricity generation.

For 2022, the entity expects to burn 579,200 metric tonnes of mazut, plus 344,800 metric tonnes of internal combustion fuel (diesel).

The €485 million price tag for conventional fuels covers the actual fuels, transport to EAC silos, port fees, fuel analysis expenses and other freight.

The EAC also expects to buy €346 million worth of energy from renewable sources this year. Once the electricity market opens up in July, the organisation will also purchase electrical energy from the Market Operator.

Overall, the EAC’s budget for 2022 amounts to €1.76 billion in expenditures, with revenues projected at €1.44 billion.

The expenditure side includes €131 million in payroll, €194 million in capital outlays, and €231 million in ‘unforeseen expenses’.