The Great Sea Interconnector (GSI) could cost a great deal more than the €1.9 billion, which is the latest estimate for the project, the finance minister said on Tuesday, while also questioning whether the interconnector would bring down electricity costs as previously advertised.
Makis Keravnos told MPs that the €1.9 billion figure – often cited in the media as the capital expenditure (capex) for the GSI – covers the cost of the subsea cable alone.
Other expenditures – such as insurance coverage, warehouses and maintenance works – should be factored into the final cost.
Without up-to-date financial data and a clear picture as to the project’s viability, Keravnos stressed, the government cannot take a decision to become an equity investor in the GSI.
Such a considerable investment would impact public finances and expenditure margins dictated by EU rules.
Should the state not invest in the project, the cost would be borne by consumers.
Keravnos cited an earlier estimate (2017) by Cyprus’ energy regulator which found that the cost to consumers from an operational GSI would come to 3.7 cents per kilowatt-hour.
“We’re not sure that the price of energy would come down [with the GSI],” he told MPs.
He also recalled a feasibility study previously done on the GSI by an American firm on behalf of the government, the results of which were not encouraging.
For this reason, said the minister, the government asked for an updated study, the findings of which are still pending.
More to follow
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