Filenews 7 October 2025 - by Chrysanthos Manoli
IPTO announced on Sunday that it does not dispute the Cyprus-Greece Understanding Framework on how and when it recovers the costs it incurs for the electrical interconnection.
And he denied our publication, in which it was stated that with the objection he submitted against the decision of CERA in July 2025, the agreement of the two governments and the regulatory framework, which do not allow the recovery of costs at the construction stage of the project, except for an amount of €125 million, is undermined and attempted to overturn, within the five years until 2029.
The framework of understanding - and the decisions of the regulators - also provide that CERA does not approve IPTO's requests for approval of the recovery of its costs for the project "by the kilo". They provide that CERA examines the requests, requests supporting documents and accordingly approves or requests more evidence. And it reserves the right for new approvals of future payments when the submission of invoices for each expense is completed. Exactly what is happening with EAC projects?
But if IPTO really accepted that it is not going to be paid by Cypriot consumers while it is carrying out the project, it will only receive €25 million per year from the state and the rest that will be approved for it along the way will be taken over a period of 35 years, why did it appeal to the Cypriot Justice requesting that three decisions of CERA (of 2024) that regulate payments in a way that is undesirable for the implementing body be declared illegal, unconstitutional or even contrary to the EU acquis?
And why did he submit an objection a few days ago to the last - related - decision of July 2025, asking for its annulment?
Is it because IPTO is trying to annul in court the decisions that do not allow it to take all its expenses while it incurs them? Is it because this remains, unacknowledged publicly, the main financial difference between IPTO and CERA? Is it because the €25 million are not enough for him, the time to finance its commitments for the project, in the absence of other financiers, and does it want to order through a court to recover its costs during the construction phase?
So far, IPTO has filed three appeals with the Administrative Court of Cyprus, seeking the annulment of the following decisions of CERA as illegal or unconstitutional:
–Decision 215/2024, date: 02/07/2024:
It concerned suggestions of the Implementing Agency (IPTO) for "Amendment of CERA Decision No. 22/2023 "Methodology for the Adjustment of the Permitted Revenues and Tariffs of the Regulated Activities of Ownership and Management of the Interconnection Line".
CERA decided not to approve IPTO's request to be given the regulatory incentive to recover expenses during the construction period, because it was given another regulatory incentive, the preferential rate of return on capital of 8.3%. And it stressed in that decision that "any expenses related to this period (of construction) will not be recognized and/or recovered in any way before the start of commercial operation of the project".
IPTO appealed to the court to annul the decision. This was followed by the Understanding Framework of the two governments and the amendment of the regulatory framework to be consistent with the framework (the well-known 5x€25 million between 2025-29), but we understand that the appeal was not withdrawn by IPTO.
–Decision 284/2024
With this decision, CERA determined that in case of delay or cancellation of the project without the responsibility of IPTO (force majeure), then it will decide to take measures to mitigate the damage for the interconnection implementing body. The decision also provides that if the responsibility for the delay or cancellation of the project is judged by the two regulators to belong to IPTO, CERA decides on its own for the damages in Cyprus and for the possible compensation measures but also for the estimated (lost) benefits for consumers from the non-timely implementation of the project. IPTO also appealed against this decision, essentially requesting that IPTO's compensations to Cyprus be co-decided with the Greek regulatory authority.
–Decision 302/2024
With this decision, CERA determined - together with the Greek regulatory authority - the amount of capital expenditure that will be returned - later - to IPTO if it implements the specific projects. The total amount approved for the planned projects of a specific regulatory period (2023-25) was €571,477 million, for which supporting documents of expenditure will then have to be submitted in order to be recovered. IPTO considered the amount insufficient and filed an appeal with the Court. Among other things, he disagreed with the decision to approve only €12 million of the €48.8 million who testified that he paid EuroAsia Interonnector to deliver the project to him.
–And the recent objection against decision 280/2025
This decision approved IPTO to recover investment expenses amounting to €82 million "on the basis of the data submitted by the Implementing Agency up to and including July 21, 2025" and "setting as the allowable revenue to be recovered for the period January 1, 2025 to December 31, 2025 the amount of €25 million."
IPTO filed an objection and it is possible that it will resort to Justice with an appeal, as it did for the other decisions of a financial nature taken by CERA. This is a 21-page objection, with very negative comments against both this decision of CERA and previous ones, focusing on the overall criticism of the non-recovery of the costs from the construction stage of the project but also the recognition of only €82 million of the €251 million claimed by IPTO, plus the €48.8 million paid to EuroAsia. Obviously because he claims a very different regulatory framework, more favourable to him.
