The platform for the competitive electricity market (CEM), which also includes the energy exchange, will be ready to operate by the fourth quarter of 2022, the Transmission System Operator (TSO) announced.

TSO Executive Director Stavros Stavrinos, told the Cyprus News Agency: “We are in the final stages of receiving the electronic platform, through which the CEM will operate in Cyprus, in the last quarter of 2022, as expected.”

Stavrinos said the competitive electricity market was based on the European net pool market model and would regulate all transactions of purchase and sale of electricity at a wholesale market level.

More specifically, he said the CEM will include financial markets of the stock market type, which are the futures market and the day-ahead market, but also other types of markets, such as the real-time balancing market, which will ensure the energy balance between production and demand.

He said the TSO had signed a contract with the Cyprus Stock Exchange (CSE) on October 20 for the provision by the CSE of the services of the Clearing House, when CEM starts to operate.

Stavrinos clarified that the main clearing would done monthly with the issuance of an invoice, but there would also be daily clearings that would concern the day-ahead market.

He said production should always be balanced with demand because if there was a large imbalance between production and demand, there might be a blackout.

Stavrinos said that the CSE had already submitted to the TSO the regulations for the securities. These are currently being examined and will be sent to the energy regulator Cera for approval.

He added that the regulations govern the way in which the participants in CEM will be considered creditworthy to avoid insolvency that would cause an imbalance in the market if financial obligations were not met.

He noted that as a securities body, the CSE would ensure that participants in the competitive market would have sufficient guarantees.