Filenews 14 July 2024
Extensive and quite informative about the current and future decisions of EAC was the speech of the Chairman of the Board of Directors George Petrou at the presentation of the activities of the Electricity Authority for 2023, last Tuesday.
According to Mr. Petrou, EAC is focusing on the opening of the electricity market, the cross-border electricity interconnection, the advent and use of natural gas, the upgrading of the Dhekelia Power Station and the operation of the new production unit at Vasilikos Power Station.
From the long speech of the EAC President, we selected some of the most important sections, which give a good picture of the performance and problems of 2023 as well as the goals for this year.
Priorities
– The main challenges for the organization include the opening of the electricity market and competition, the cross-border electricity interconnection, the advent and use of Natural Gas, the upgrade of the Dhekelia Power Station, the operation of the new production unit at Vasilikos Station and the upgrade of infrastructure.
– The transition to green energy and the reduction of greenhouse emissions is a top goal for EAC. The expansion to Renewable Energy Sources, the addition of green energy to EAC's production mix and energy storage are the only way. Only in this way will it be possible to stabilise and then gradually reduce the price to all consumers, domestic and business.
– In addition to the photovoltaic park in Tseri, the photovoltaic park in Akrotiri, Limassol was also put into operation in 2023. The energy produced from it costs just 5 cents per kilowatt hour. This results in the first, albeit small, reduction in energy costs for all consumers.
– The 8MW Achera Park will soon be put into operation. At the same time, new photovoltaic parks are planned in various areas of Cyprus and permits for new projects are progressing, such as the 2ndphase of the 34MW Achera PV Park.
– EAC's participation plan in Renewable Energy Sources, as approved, allows the gradual development of photovoltaic parks with a total capacity of 600 MW by 2032. Construction permits have already been secured for photovoltaics with a capacity of approximately 168 MW.
– The development of RES projects also underlines the need to create infrastructure for storing the produced green energy. With a relevant application to CERA, EAC proceeds with the licensing of a large storage system in Dhekelia (160 MWh), after securing the permits.
– The Main Regulated Transmission Activity (EAC), in cooperation with the Cyprus Transmission System Operator (TSO), have proceeded to a preliminary study for the installation of energy storage systems, through batteries, with a total capacity of 240 MWh. The budget of the project amounts to 60 million euros, funded by European funds.
Financial situation and profits
– EAC's total revenues in 2023 amounted to €1.3 billion.
Total expenses reached €1.2 billion.
– Profit of €61m and net profit for the year of €36m.
– The profit of operations corresponds to a return of 3.1% on the average net employed asset (ed. the allowed by EAC is approximately 4.6%).
– Operating expenses decreased by €98.5m. The decrease is mainly due to the reduction in fuel costs and the decrease in the purchase price of energy from third parties (from €103.9 million to €63.3 million). The purchase of energy from third parties (11 cents/KWh, by decision of CERA) includes the purchase of energy from RES and the purchase of energy from the transitional market (avoidance costs/KWh).
– The reduction in costs by about 39% is mainly due to the decrease in the purchase price of energy from RES. This, according to CERA's decision, from May 1, 2023 cannot exceed 11 cents per kilowatt hour at low voltage. The overall cost reduction was also contributed by the reduction in units purchased from RES, which is of the order of 24.8%.
– Fuel costs decreased from €671 million. in 2022 to €575 mil. in 2023 (a decrease of 14%).
– The cost of greenhouse gas emission allowances increased by €8 million. in 2023 and amounted to around €256m. The increase is mainly due to the increase in the average price of allowances purchased during the year, which amounted to €83.93/allowance, compared to €80.02/option in the previous year.
– From the beginning of 2024 there is a decrease in the price of allowances. Taking advantage of the decrease in prices, EAC has purchased a significant number of additional rights from the beginning of January 2024 until today, in order to use them when their market price increases. The average purchase price of the additional allowances is approximately €64.
Development projects and planning
In 2023, the installation of the new Combined Cycle Gas Turbine Unit (MUSK 6) at Vasilikos Power Station, with a capacity of 160 MW, continued. The plant will be able to use natural gas as the main fuel and diesel as an alternative fuel, with limited operating hours (500 hours per year). The expected completion date of the new Unit is within 2025.
– EAC has taken the necessary steps to ensure that the production units are fully ready for the use of natural gas, as soon as it becomes available for electricity production. The necessary coordination with the manufacturing companies remains for final arrangements in the production units and the organization of the necessary tests and controls, once the date when the natural gas will be available is determined.
– Soon, the dismantling of the steam units of Moni station is completed. The four gas turbines (37.5 MW each) remain available, ready to be put into operation in case of high electricity demand, or to deal with emergencies. The future use of this site is examined in the context of the study of the EAC Development Programme.
Extension of electricity transmission and distribution network
– In 2023, phase B was completed for the project concerning the New Moni Transmission Substation.
– Works were carried out for projects that continue to be implemented in the context of the further penetration of RES in the Transmission Network and the upgrading of the Transmission Network. Specifically, the upgrading works of the Substations of Orounta, Strovolos, Ypsonas and Mari are in progress.
– Co-financed projects for the installation and upgrade of transmission substations, with a total value of €43 million, are also in progress. The European Union covers 70% of the costs.
– The upgrade of transmission lines with the €10 million pipeline reconductoring method begins. By upgrading these lines, the interconnection capacity of more RES projects is achieved. In particular, the projects concern: Construction of new 132kV Transmission Lines and dismantling of existing connections such as Kofinou – Alhambra Substation, Ypsonas – East Transmission Substation, Ypsonas – Trimiklini Substation, Installation of a New Primary Substation New Port in Limassol, upgrading of Ypsonas Substation, and other equally important projects, aiming at the further penetration of RES in the Transmission Network.
– From EAC Distribution's Activity, in 2023 215 km of Medium and Low Voltage overhead lines, 323 km of Medium and Low Voltage underground cables were installed, while 113 overhead transformers and 128 terrestrial Distribution Substations were installed.
– During 2023, 18,500 new PV self-consumption systems were connected to the EAC network. In total, to date, 55,000 PV systems of this type have been installed, mainly for residential use, with a total capacity of 320 MW.
Applications for Dhekelia
In the context of ensuring security of supply and stability of the system and with the aim of strengthening Dhekelia Power Station as a second power point, the Production Department proceeds with the licensing for the installation of storage systems and conventional units.
EAC has already submitted the relevant applications to CERA for the installation of 2 open cycle units, with a total capacity of approximately 80MW (2 x 40MW), as well as a storage system (capacity 40MW/160MWh). A specialized consultant prepares the specifications for the tender for the supply and installation of two production units, with a total capacity of 80MW (2X40MW).
