It is said that the great white shark does not have a sense of satiety. It eats tons of small fish and, even though it has eaten to the point of bursting, it continues unscathed.
Something similar has been happening for seven years in the long-suffering Cyprus, with the so-called "transitional electricity market". It has created phenomena of insatiability, similar to those of the white shark. The cost of this fattening is not in tons of fish, but in millions of euros — specifically, it is estimated at €350 million.
What happened in the transition market?
In the context of the transitional market, which operates until today, private suppliers (intermediaries) secured electricity only from Photovoltaic Parks, either from their own or by buying from other parks.
For example, how do they manage the total production of e.g. 100 kilowatt hours until sunset in a month (CERA's decision the energy was cleared every month, i.e. what you produced, bought and sold in a month as a supplier)?
CERA allowed them to find customers whose total consumption, based on the example, would be close to 100 kilowatt hours on a 24-hour basis. Thus, they avoided buying electricity from EAC, unless they had to cover any overruns. That is, they only bought from EAC if their customers increased their consumption or the production of their photovoltaics was not as expected within the month in question.
Although EAC units also produced electricity for the private suppliers' customers, during the hours without sunshine, private suppliers were not charged accordingly — as CERA had configured the system so that they would not be burdened with these costs.
In other words, these individuals—especially those who were both producers and suppliers—operated as if they had a net metering system. Their photovoltaic parks were like a "home roof" and the EAC network operated as a "battery". The main difference is that they pay a grid fee (pass it on to their customer) for all the energy they sell, while the average consumer with net metering only pays for the energy imported into their home.
Nevertheless, the prices they charged their customers were almost the same as those of EAC, which produces with expensive fuel.
What changes with the competitive market?
The introduction of the competitive market on October 1 puts a small brake on the "party". Because;
Because, during the hours of sunshine, private suppliers who currently draw energy only from RES will have to buy electricity from EAC as well.
The inertia provided by EAC thermal units to stabilize the system — and thanks to which photovoltaics can also operate — will now be charged to everyone.
Until now, this cost has only been borne by the ordinary consumer – i.e. the EAC customer.
And now that the rules are coming, the complaints have begun. The private individuals who have benefited from the distortions in the system so far, are now reacting. Some even target institutional actors of the state. However, this practice shows how much they have learned. They can't stand the small brake on eating, they don't want limits. They want the whole system for their own sake, just as the great white shark wants the entire marine ecosystem.
They even go so far as to be annoyed by warnings that, if distortions continue in the competitive market, the state will intervene. Perhaps some think that it is a "state within a state".
The need for stability and security
With the functioning of the competitive market, some units were rightly characterized as "must run". These are EAC units that are mandatory to be included in the system by the Cyprus Transmission System Operator (TSO) due to technical or operational requirements. At the moment there is no other technology or other independent producer with fuelled units that provide the technical and operational requirements.
The main reason is the one that was mentioned:
Inertia and stability: Combustion plants (EAC today) provide inertia and stability to the system – an element that renewables, for the time being, cannot offer. Without them, the system is threatened.
What is inertia has been explained in another post. Those who question it as necessary for the system, should also ask the Spaniards. At the same time, the operation of combustion plants offer support to RES. Renewables are variable and in order to be able to operate, they need these thermal units next to them.
The "compulsorily integrated units" (without which the system is threatened with collapse) will be paid outside the market, and these costs must be distributed to all suppliers (EAC and individuals) through special mechanisms managed by the TSO.
Trailing:
The competitive market is not a panacea, but it certainly reduces the distortions of the previous regime. Until now, all the burden was borne by the EAC consumer, while some "paralyzed" private individuals made profits at the expense of the common interest.
Postscript: Is it a coincidence that a political person who participates in the Parliament – as an alleged representative of the people – has been constantly questioning for a long time the necessity of the operation of these units that ensure the security of the system?
