Cyprus activates mechanism over risk of electricity shortage by 2030 — Cyprus Mail

The Cypriot government has activated Article 34 of the Electricity Market Regulation Law, which makes it possible to begin the procedure for introducing a capacity mechanism. The decision is linked to the risk of a significant electricity shortage by 2030, Cyprus Mail reports.

Risk of a 720-megawatt shortage

Polivios Lemonaris, head of the energy regulator Cera, told lawmakers that under the worst-case scenario, Cyprus could face a shortage of approximately 720 megawatts of capacity. This calculation assumes that by 2030 the country will have neither natural gas for electricity generation nor an electricity interconnection with another country.

One of the main reasons for the potential gap between demand and supply is the mandatory decommissioning of turbines that do not comply with EU environmental standards. This concerns six turbines at the Dhekelia power station and another three at the Vasiliko station.

What the capacity mechanism provides for

A capacity mechanism is a market system under which power plants, energy storage facilities and demand-response service providers receive payment for being ready to be available to the system during periods of high demand or low renewable energy generation.

More current news is available on the UA.News Telegram channel Telegram.

According to the regulator, if the mechanism is put into practical operation, different technologies may be used depending on the needs of the power system. Consumers will ultimately bear the costs of its implementation. Such mechanisms are considered a form of state aid and therefore require approval from the European Commission.

The activation of Article 34 does not yet mean the start of tenders for new capacity. A decree by the energy minister, which must define the application procedure, the required capacity volume in megawatts and the conditions for its provision, has not yet been issued. It is to be prepared after consultations with Cera and the transmission system operator, while the procedure is currently at the consultation stage.

Disy MP Nikos Georgiou said that the situation regarding the country's energy adequacy had become critical. According to him, lawmakers asked the authorities to provide a specific action plan and timetable.