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Energy minister: State at fault for high energy prices

Peo, EAC, energy minister, George Papanastasiou, Giorgos Papanastasiou
Energy Minister George Papanastasiou

The Electricity Authority of Cyprus (EAC) is partly to blame for Cyprus’ energy woes and high prices, but the state has let the people down, Energy Minister George Papanastasiou said on Thursday.

The minister sought to speak frankly and honestly of the failures and current state of the energy market but vowed that Cyprus can and will turn the page.

He promised that natural gas will be exploited – despite potential geopolitical tensions this may cause – and the EAC beefed up so it can work properly, resulting in energy prices coming down.

He said the EAC had become a dogsbody which is blamed for everything – “whenever someone sees something expensive, they blame the EAC, but I say the EAC is not to blame”.

“It may be partly to blame but the state should be blamed much more, and I wish to apologise on its behalf,” he told a meeting of EAC-related trade unions.

He further apologised to consumers for the state not doing what was needed to ensure that the EAC was able to drive prices down, adding that the body is directionless as it was restricted by the state.

Papanastasiou further stressed his determination to upgrade Cyprus’ energy market by utilising natural gas both from deposits within its EEZ and the wider region, as a means of lowering electricity prices.

“Although I am a recent addition to the ministry, I can say honestly that we have not given the EAC the tools it needs to be the price setter – the one who sets the price of electricity downwards, not higher,” he said.

“The price of electricity must go down, we will give the EAC the tools it needs to get the prices down – we will give it natural gas, we will give it the freedom in green energy production so the EAC can show us what it can do,” Papanastasiou emphasised.

Critics of the EAC have long expressed their exasperation at what they say is the EAC’s inability to get prices down, work more efficiently and make the upgrades needed – despite being a monopoly.

But Papanastasiou said he is adamant that the situation can be resolved but warned that importing LNG will not offer an immediate reduction in prices as the product has become more costly since Russia’s invasion of Ukraine.

The minister said there are plans to get natural gas which were approved by President Nikos Christodoulides.

“There will be geopolitical reactions but this country must finally stand its ground and stand tall because this is a proud nation, but we have made is to that we are not proud of anything,” he stressed.

He concluded by saying that Cyprus cannot be dependent on the choices made by others: “We will get gas from the neighbourhood, perhaps even our own [deposits], Cyprus first and then the rest – Cyprus comes first.”

Earlier this month, Papanastasiou revealed he would return to Israel for talks with his counterpart there aimed at hammering out a deal for a pipeline transferring natural gas from Israeli gas fields to the island for liquefaction.

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