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Minister makes urgent call for energy prices to come down

Υπουργείο Ενέργειας – Τελετή παρά
Energy Minister George Papanastasiou

Electricity prices must come down, as expensive energy is sapping people’s disposable income and also raising the cost of production for businesses, new Energy Minister George Papanastasiou stressed on Tuesday.

“It is urgent for electricity to become cheaper, so that households do not fear opening up their electrical bill, so that industry can operate normally,” Papanastasiou said at the House energy committee.

It was his first meeting with MPs since being appointed minister.

Papanastasiou said he was personally concerned about poor people, and vowed the new administration would roll up its sleeves and work to find ways of bringing down the cost of energy.

One way to do that would be to increase the absorption of electricity generated by renewables into the grid.

“It’s unfortunate that we are not able to include all renewables in the grid. We will be looking at both the transmission and distribution grids, we will apply pressure to rectify all these things,” he told MPs.

It does not stand to reason that a country blessed with so much sunshine cannot make full use of it, he added.

The minister also pledged he would redouble efforts for importing natural gas, which is hoped will reduce the cost of electricity.

He was alluding to the LNG import terminal at the port of Vasilikos -a project dogged by repeated delays.

As reported by the Cyprus Mail a year ago, the project was still stuck at 4 per cent completion more than two years after the signing of the initial contract.

In comments to the media later, Papanastasiou said all options would be looked at.

Conventional energy should co-exist with renewables so as to drive down energy costs. The transmission and distribution grids may have shortcomings in this regard, and to this end the minister said he’d speak with the experts and then decide what can be done to up the system’s use of solar-powered electricity.

MPs – including from main opposition Akel – welcomed the minister’s comments, saying they looked forward to working with him closely in the future. Papanastasiou himself promised he’d be “a regular visitor” at the House energy committee.

But beyond the niceties, Akel deputy Costas Costa reminded the new minister that he will have his plate full with a multitude of issues that need addressing.

These included the ‘fines’ paid by Cyprus to the EU for its greenhouse gas emissions, ‘profiteering’ in petrol sales, the opening up of the electricity market, and promoting the offshore hydrocarbons exploration programme.

On the latter, Costa recalled the deadlock in talks between Cyprus and Israel over the development of the Aphrodite natural gas reservoir.

“We also stressed [during the committee session] that we will stand by him whenever he takes the correct decisions and actions which serve the public interest, but that we will oppose him for decisions which damage the public interest or which serve other interests.”

Also discussed was the proposed introduction of a ‘household basket’ – a weekly list of lower-priced staple goods. Under the proposal, the prices of products included in the ‘basket’ should be lower than those off the list. Listed products would carry a special mark so that customers could easily identify them.

Papanastasiou said he liked the idea of the ‘basket’, describing it as a useful tool that will boost transparency. But he added that he is in favour of “organic change” – cheaper energy so that manufacturers can make cheaper products.

“The real issue,” he stressed, “lies with the energy needed to make a product that is more competitive, both in the domestic market and for exports.”

In parliament, representatives of supermarkets and employers organisations expressed their disagreement with the ‘basket’ – for which the government is drafting legislation.

They said it would apply only to businesses with an annual turnover of €8 million and above, noting that this could potentially create problems with competition – particularly as smaller supermarkets would not be included in the ‘basket’ system.

Papanastasiou promised his ministry would bring the ‘basket’ bill to parliament in a month’s time.

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