The electricity authority (EAC) has been given the clear go-ahead to upgrade the Dhekelia power plant with two new flexible generators and is in the process of evaluating tenders, Energy Minister George Papanastasiou said on Friday. 

It is not yet clear who would bear the cost of the investment, he said, but the “state has spoken” as far as the imperative to ensure energy security for the country.

Negotiations are underway at the EU level as to who will pay for the investment, with the European Commission suggesting that the entire cost had to be borne by EAC customers, while the state had pushed for it to be borne by all grid users, regardless of whether their energy was self-generated.

Despite arguments that the estimated €150 million cost was high, “the cost of a blackout would be much higher”, Papanastasiou warned.

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The current situation with “overproduction” of energy from renewable energy sources and power cuts when weather conditions are unfavourable, could not be permitted to continue, he said.

“As a public organisation, the EAC must follow the direction of the state,” he said. In this case, the mandate to upgrade the capacity of conventional energy production on the island to guarantee sufficiency under any conditions.

As for covering the cost of the investment, discussions were underway with the EU Directorate-General for Competition and the state aid Commissioner as to how this could be secured, the minister said. 

The EAC is the main producer, as well as a supplier, of energy on the island, with 92 per cent of all electricity consumers under its umbrella. Papanastasiou said this is expected to be the case for several years. 

The remaining eight per cent are large commercial and industrial consumers who generate their own supply but still make use of the EAC-owned grid. 

The EU’s approval of the method of payment for the investment in Dhekelia is not a prerequisite for the installation of the new generators to go ahead, the minister said, although the state is seeking to convince the commission that all EAC grid users and not just direct EAC customers must bear the cost.

“We won’t place the state’s energy supply at risk because of an issue at the EU level,” the minister said. 

President Nikos Christodoulides had given clear instructions to everyone to proceed with procedures for the procurement and installation of new, flexible gas turbines for Dhekelia at Tuesday’s energy meeting at the Presidential Palace, he added.

Papanastasiou had confirmed last week that the EAC is “already going through the tendering process” to procure the equipment to install two flexible 40-megawatt generators.

Asked about the potential timeframe for the generators’ installation, he said that if the tenders for their purchase are awarded “in the coming days”, they could be installed within the next year.

The announcement of new generators at the Dhekelia power station comes after local residents had staged a protest there last month, demanding it be upgraded with “less polluting machinery” to be “less harmful” to both the environment and human health.

Antonis Photi, the mukhtar of nearby Ormidia, declared that the continued operation of the power station in its current form is “unacceptable”, describing its current machinery as “ancient”.

“It pollutes the oxygen we breathe and our environment, resulting in health problems for the people of the wider area,” he said.

The European Commission had initially demanded that Cyprus close the power station, given that it does not meet the EU’s emissions targets, but Cypriot government promises to modernise it to mitigate those emissions saw the deadline extended twice.