Filenews 22 October 2021
Cyprus has taken a number of measures to deal with the increase in the price of electricity, which will be implemented earlier than in most EU countries, said Minister of Energy, Trade and Industry Natasha Pilidou, who presented her Ministry's budget to the Parliamentary Committee on Finance on Friday.
Mrs. Pilidou noted that Cyprus has the second lowest increase in the cost of electricity in the EU, but was one of the first countries to adopt the measure of a 10% reduction in electricity costs for four months, as well as a series of other measures that push both households and businesses to adopt green policies.
"Certainly the aim of the measures should be the green transition in addition to reducing costs," she said, adding that the best measures for everyone are the adoption of green practices, which also reduce electricity costs.
Speaking to the Commission, she said that the toolbox prepared by the EU has already been studied and meetings have been held with a view to long-term measures and a shift to green growth. At the same time, she said that the fact that Cyprus does not yet have natural gas contributes to the non-skyrocketing of electricity prices, since the price of natural gas has increased significantly.
We are moving forward with our drilling plans despite the opposition
Asked about the energy programme and whether she is concerned about Turkey's reactions to the impending drilling in block 10 of the Cyprus EEZ, the Minister said that there are certainly reactions and said that they will be addressed and addressed.
"There are definitely reactions, I believe they will be addressed and they are being addressed and we are moving forward with our plans as they have been announced. We hope that the confirmatory drilling will have positive results and that the quantities, which were detected in the first drilling, will be confirmed," she said.
Speaking to the Committee, she noted that while due to the pandemic many projects were abandoned worldwide, in Cyprus there was no cancellation of any project.
She also said that as far as the Aphrodite - Egypt pipeline is concerned, there are very rapid developments.
Responding to criticisms by the Chairman of the Finance Committee Christiana Erotokritou that we have been stagnant for years regarding the co-exploitation agreement with Israel, which concerns the "Aphrodite" deposit, the Minister said that we are in the field of arrogation and that there are timetables for its completion within six months. She also noted that there is no question of an agreement with Israel to move "Aphrodite" forward and the companies are moving forward with their contractual obligations.
Regarding the creation of a gas terminal, she said that this possibility has been discussed with ExxonMobil and if there are quantities there is an intention to do so, but the indications with the companies are rather that the pipeline to Egypt will be a preferred option.
Increased subsidies and European funds raised in 2022
Presenting the budget, Mrs. Pilidou said that in 2021 the Ministry focused on the practical support of businesses and households in the midst of the pandemic, while measures were also taken to address the price of electricity prices. Sponsorship plans for businesses and for the promotion of energy upgrading of homes, amounting to more than €126 million, an amount equal to what was spent in the previous programming period 2014-2020, were announced, she said, and will increase to €166 million at the end of year, beginning of 2022.
In September, she added, compensatory measures were announced due to the price of electricity prices. Among other things, a 10% reduction for two months and implementation of a sponsorship plan to replace energy-intensive household appliances in vulnerable households, a plan that will be announced in November.
For the planned 2022 projects, the Yeeb is expected to draw €32.5 million from the Resilience and Recovery Plan (SDS). In total, the Ministry will raise €337 million during the period 2021-2026. from the SDS and during the period 2021-2027 €209 million. of the European Structural Funds, the Cohesion Fund and other Funds, of which 61% are for the green economy, 38% for businesses and the remaining part for infrastructure.
In 2022, said the Minister, our effort is to provide incentives to businesses, households and the public sector, which will combine the strengthening of entrepreneurship and growth, with the promotion of the transition to a green economy. Among other things, a sponsorship plan for the circular economy of €13 million, a sponsorship plan for the energy upgrade of businesses and local authorities of €40 million will be announced. and a sponsorship plan for energy upgrading of homes of €35 million. (plus another €7 million from the RES & ES Fund).
Under study, she said, are other plans to provide incentives for energy storage systems, creation of partnerships in the business sector, energy efficiency in new buildings, participation of businesses in international exhibitions and extroversion of Cypriot businesses.
The total Budgeted Expenditure of the Ministry for 2022 is increased compared to 2021 by €32,946,879 or by 37%. Regular Expenses for 2022 compared to 2021 show an increase of €11,999,352.
As far as the various services of the Ministry are concerned, the priority of the Hydrocarbons Service for 2022 is the research and confirmatory drilling program of the licensees within the Exclusive Economic Zone of the Republic, following the respite that was compulsorily caused due to the pandemic. "We are working intensively and wisely, aiming at the optimal and sustainable exploitation of Cyprus' hydrocarbons," she said.
She also noted that in January 2022 Cyprus will assume the Presidency of the East Mediterranean Gas Forum (EMGF), with the aim of further strengthening regional cooperation in the field of natural gas and green energy transition, as well as strengthening the role of Cyprus in the Mediterranean region.
As far as the Energy Agency is concerned, she said that the aim is to implement a multidimensional strategy. She also mentioned that a steering committee of technocrats of the co-competent Ministries is proceeding with the process of revising the National Energy and Climate Plan. "In 2022 we will set our even more ambitious targets on the basis of the Commission's proposal to reduce emissions by up to 55% in 2030."
In relation to the RES and Energy Saving targets, she said the Ministry has exceeded the target of 13% for RES in gross final energy consumption and is at 17%.
She also said that work is ongoing on the construction of infrastructure for the import of liquefied natural gas and its gasification, at a cost of €289 million.
Regarding the opening of the electricity market, she said that the procedures for the integration of the TSO's software, through which the competitive electricity market can be put into operation, are being set in place. She said the opening is expected to take place in Fall 2022 and expressed optimism that the timetables would be met. At the same time, she said that the framework for energy storage is also progressing at the same time. As she said, with the opening of the Market, energy storage will be allowed to households but also to energy autonomous communities that will be able to have their own small network and expressed the hope that this will be embraced by municipalities and communities.
Regarding the lifting of energy isolation, she said that €25 million will be given for the implementation of the EuroAsia Interconnector project of Common Interest for the electrical interconnection of Cyprus, Israel and Greece. A proposal was also submitted to the European project Connecting Europe Facility by an implementing body for European funding.
Regarding trade, she mentioned that efforts to promote Cypriot products and services abroad are continuing more intensively, with sponsorship plans 2022 for participation in exhibitions, totalling €3.6 million.
The Minister described the creation of a national identity of Cypriot products as important. As she said, in 2022 it is expected that the visual identity for Cypriot wine will be completed and applied, as well as the actions of the study on the national identity for Cypriot products will begin to be implemented. In the first quarter of 2022, the study for the promotion of halloumi will be launched in international markets.
She also said that in 2022 the practical support of businesses through targeted sponsorship schemes continues, which are an incentive for further investments and strengthening their competitiveness.
She also referred to the National Action Plan for strengthening the circular economy 2021-27, which includes policy measures and specific actions for the promotion, promotion and development of the circular economy in Cyprus.
Regarding the total amount of Sponsorship Schemes for tenders in 2022, she said that it will approach €130 million.
As far as the Consumer Protection Agency is concerned, she referred to the development of a new software framework for assessing the prices of petroleum products. Following an open tender held in 2021, the contract for the creation of the new framework was awarded to a consortium, which has already started the implementation of the project.
Regarding the Department of the Registrar of Companies and Intellectual Property, she referred to new actions 2022 in the context of reorganization and modernization.
As far as the Insolvency Service is concerned, she referred to the intensive work being done to complete the reforms required for the full implementation of the National Insolvency Action Plan, "in order to be able to respond more effectively to the requirement to provide second chance to citizens and businesses". She added that there has been progress in the automation and creation of the department's website, while where there is indeed an issue is in the staffing of the department and for this reason actions are being taken with the YPIK.
Party interventions
In his speech during the discussion, DISY MP Onoufrios Koulas referred to the multifarious work carried out by the Ministry, in which many objectives concerning RES, energy saving, competitiveness, exports, insolvency, green growth, entrepreneurship, etc. have been placed. He also said that the Ministry has fallen on the greatest burden of the Recovery Fund and the other co-financed funds that concern the private sector as a whole. He also expressed certainty of a 100% absorption of the funds.
AKEL MP Costas Costas referred to the very good and serious work that has been done in some sectors in recent years, but expressed some concerns regarding the hydrocarbons sector. As he said, the issue of hydrocarbons can change the future of the country and needs quick and decisive planning, while the government often uses them as a communication tool. He expressed concerns about the delays in the research programme and expressed the hope that no more extensions would be given to companies for their contractual obligations. He expressed concern about whether a liquefaction terminal would be built, but about the negotiations for the development of Aphrodite, but also about the problems Turkey is creating for the research vessel for EastMed.
DIKO MP Panicos Leonidou described the course of things as positive and noted the personal role of the Minister and her associates, stating that the difference appears. He added that the Ministry and all of us should work to avoid any more delays in the exploitation of the natural energy sources of Cyprus. He also expressed concern at the non-conclusion of negotiations with Israel. He also referred to the need for measures for the citizens of cities and the countryside, and said that in relation to increases in electricity, citizens should be respected by the new policy to be pursued.
EDEK MP Ilias Myrianthous said that as an economy we are mainly introductory and we should see the creation of an extroversion of the Cypriot economy to cover the huge needs covered by imports today. Our industry in cooperation with the primary sector, he said, has huge potential and should be examined how to produce and decentralize development geographically, so that the entire Cypriot territory can be developed.
DIPA MP Alekos Trifonidis said that this is a very important and developmental ministry and said that they agree to the transformation of Cyprus into a regional energy centre, with the exploitation of bilateral agreements with neighbouring countries. He added that there should be no more delays in Cyprus' research programme and expressed concern about a delay in infrastructure projects and the advent of natural gas. As regards renewables, he noted with satisfaction the achievement of the 13% target, but said that this had not been achieved in the transport sector. He also said that the passage of bills to open up the competitive electricity market is positive. He also spoke of the need for closer monitoring and market controls to be precise and a reduction in the VAT rate for electricity.
The MP of the Movement of Ecologists – Citizens' Cooperation Stavros Papadouris said that they expect a lot from the Ministry of Energy, especially on the issue of RES. He also noted a delay in the arrival of natural gas and spoke of the need to reduce VAT on electricity. He also called for the creation of a section on the green and circular economy so that citizens can get guidelines on how they can benefit from the different programmes. Regarding the insolvency framework, he said that there are serious delays and they have not reached even a third of the targets for 2021, while he said that the department is understaffed, despite the fact that auctions have already been released.
