Cyprus could face serious electricity supply problems by 2030 if natural gas is not introduced by then, Energy Minister Michael Damianos warned on Tuesday, insisting that completing the long-delayed Vasiliko liquefied natural gas terminal is the country’s only viable option.

Speaking at the House energy committee, Damianos said the Vasiliko project “must be completed before 2030 – and it certainly will be completed before 2030.”

He argued that pursuing an alternative interim solution would likely take just as long, if not longer, because of the public procurement process, which would require new tender specifications, bidding procedures, possible legal challenges and construction from scratch.

“Our decision is to continue with the Vasiliko project because we need it. We need natural gas,” he said.

Damianos had earlier told the Cyprus Mail that it is not only a priority for the government but it is also the “main priority in this ministry, to finish this as soon as possible” as “LNG is cheaper than diesel.”

“Vasiliko and renewables are connected, they are the two main things we need,” he said.

Damianos said a technical assessment carried out by engineering company Technip and received by the government at the end of 2025 found the project to be incomplete.

“Whether it is 40 per cent or 60 per cent complete is a highly technical question, but the only real solution is to finish this project,” he said.

The minister said tender documents are expected to be finalised by the end of July, while a new board of directors has recently been appointed at the Natural Gas Public Company (Defa), allowing Natural Gas Infrastructure Company (Etyfa) to complete the tender process.

The government aims to award the contract by the end of 2026 or during the first quarter of 2027, he said, expressing hope that the process will not be delayed by legal challenges, allowing construction to resume as soon as possible.

The issue of electricity adequacy has become increasingly urgent because Cyprus has committed to the European Union to retire the ageing generators at the Dhekelia Power Station by the end of 2029.

Damianos said the electricity currently produced by those units must be replaced from 2030 onwards.

The Electricity Authority of Cyprus has already ordered three new lower-emission generators, with two due to arrive in 2028 and a third in 2029.

While all three are expected to be operational by the end of 2029, Damianos said they have a lower generating capacity than the units they will replace.

“Replacing the Dhekelia generators can only be achieved with the arrival of natural gas through the Vasiliko project,” he said.

Damianos said the Transmission System Operator has awarded a contract for 120 megawatts of battery storage, which is expected to be delivered by January 2027 and operational before the summer of that year.

The batteries will allow Cyprus to make greater use of solar energy, reduce curtailments of renewable electricity and limit the number of household photovoltaic systems that have to be disconnected from the grid.

“Once we have 120MW of storage in our energy mix, it will also contribute to electricity adequacy,” Damianos said.

However, he stressed that battery storage alone is insufficient.

“On days without sunshine, you will obviously still have a problem, and that is why we need natural gas.”

Damianos also said EAC is developing a further 180MW of storage capacity, while the transmission system operator has granted terms to 16 licences to private-sector battery projects totalling 150MW.

By 2027, the ministry expects around 450MW of storage capacity to be connected to the grid, a level it believes will be sufficient to support greater renewable energy penetration.

Damianos added that increasing the share of renewable energy should also help reduce electricity prices over time.

Finally, Damianos said the ministry intends to work with the EAC to restore electricity credits that were unfairly removed from between 7,000 and 10,000 households with rooftop photovoltaic systems.

Under contracts signed in 2021 and 2022, he said, those credits should not have expired until around 2036 or 2037.