Filenews 23 November 2022 - by Chrysanthos Manolis
Compared to 2022, the total expenditure and revenues of the Electricity Authority of Cyprus will increase by one billion euros in 2023, according to the budget approved by the Ministry and submitted to the Parliament. The EAC budget for 2022 foresaw expenditure of €1.7 billion while expenditure of €2.7 billion is foreseen for 2023. Fortunately, EAC's revenues are expected to increase equally. Revenues of €1.4 billion were budgeted for 2022 while revenues of €2.4 billion are budgeted for 2023.
It follows from the above numbers that EAC will continue this year, as last year, to have a significant deficit in its activities, compared to profits it made in previous years. For both 2022 and 2023, the budgeted deficits amount to around €300 million annually.
The main reason for the large increase in EAC's expenses (and revenues) in 2023 is the obligation that the organization will have from now on to pay through the Market Operator (Cyprus Transmission System Operator) for the electricity that will be provided by EAC Production. Until now, EAC bought this electricity directly from EAC Production, without the amount being a budgetary expense. In the same way, i.e. through the Market Operator, EAC's electricity sales will also take place, which is why in the budget there is a corresponding amount as revenue of the Authority from the Market Operator, for the sale of energy.
Of the €2.7 billion that EAC plans to spend in 2023, €142.5 million relates to remuneration for staff.
By a huge margin, the largest expenditure for the Authority concerns the purchase of fuel for electricity generation, the purchase of electricity from other producers and the payment of the Market Operator (as explained above) for the electricity that EAC will be supplied in the context of the competitive electricity market by EAC Production. In total, this expenditure will amount to almost €2 billion in 2023. (€1,991,162,000).
In particular, for the purchase of fuel (oil and natural gas, if the LNG terminal in Vasilikos is operational by September 2023) EAC budgeted €682 million. €200 million more than the 2022 budget. The final cost of EAC will depend on the prices that will be formed in the international market.
For the purchase of energy from private renewable energy companies, it is planned to buy energy worth €110 million. For the purchase of electricity from EAC Production, through the Market Operator, a cost of €734 million is foreseen.
Another €283 million for pollutants!
The annual cost of purchasing greenhouse gas emission allowances is evolving into an ever-increasing wound for the Cypriot economy and society in general - as well as the environment. According to the 2023 budget, EAC will pay €283,313,000 to emit the gases corresponding to the necessary electricity production, given that it still uses fuel oil and diesel. However, for 2023, EAC budgeted (probably for the first time in its history) the purchase of 40,500 metric tons of natural gas, without it being certain that the use of gas will finally be possible within the next year. For 2022, EAC had budgeted an expenditure of €183 million for the purchase of emission allowances, but due to the skyrocketing allowance price per tonne it is estimated that the final actual expenditure will be greater. For 2021 the corresponding cost was €165 million.
146 new positions and... Individuals
Of the 370 new posts requested by the Board of Directors and the EAC management from the Ministries of Energy and Finance, 146 were approved. Mostly recruitment will be to meet needs in the networks. Fifty of the new positions concern technicians, 31 positions of network workers and assistant network technicians, 13 installers, 13 meter recorders and 11 assistant network engineers and network engineers. It should be noted that the Ministry of Finance informed EAC that "any additional staffing needs in EAC Distribution should be covered by purchasing services from the private sector, which has relevant know-how". It also calls for the large number of vacancies in the EAC to be taken advantage of.
