Those hoping for immediate relief from the continuous surge in energy prices may be disappointed in today’s meeting on the issue, with top officials instead looking towards longer-term solutions.
President Nicos Anastasiades held a key meeting on the energy and related price crisis on Friday where he called in the energy and finance ministers, along with the Cyprus Energy Regulation Authority (Cera) and the Electricity Authority of Cyprus (EAC).
They decided on seven main points, which centre on investing in and diversifying the island’s energy portfolio – relying on EU funds to secure more green and renewable energy.
Specifically, it was decided that they will increase staffing at the EAC – “to enhance the organisation’s network”, while the government will also invest €80m (from EU funds) in greater energy storage units.
It was further stated that those involved at the meeting will investigate how to tax or end the steep profiteering of those selling on energy produced from renewables.
Also announced was that the government is evaluating new measures which can be brought in from August 31 when the current VAT reductions on electricity are set to end. It’s worth noting that in May the cabinet decided to extend the reduction in VAT on electricity from 19 per cent to 9 per cent for all households, and from 19 per cent to 5 per cent for vulnerable groups until August.
Elsewhere, it was agreed at the meeting that they will investigate ways to increase the percentage of renewable energy produced by the EAC – which will necessitate cooperation with Cera.
And, finally, an information campaign is planned to help enlighten the public on ways to save energy.
The government sought to reiterate that €100m in funds have been made available to upgrade the energy production and efficiency of both households and businesses.
Analysts expect that there is room for electricity prices to rise higher.
According to Eurostat, during the second half of 2021 the average price of electricity for Cypriot households was 23 cents/kWh – of which, a whopping 37 per cent was due to taxes. The comparative numbers respectively for Greece were 19.5 cents/kWh and 20 per cent, and for Malta 13 cents/kWh and five per cent. All within EU tax guidelines. The rise in electricity prices in Cyprus last year was the third highest in Europe, over three times the EU average.