Energy analyst Christos Tsingis has alleged that serious market distortions and oligopolistic conditions exist in Cyprus's electricity sector, arguing that the low cost of generating power from solar energy is not being passed on to consumers.
Speaking on Politis radio programme Morning Briefing, hosted by Katerina Eliadi, Tsingis questioned the way electricity prices are formed, particularly in relation to large-scale photovoltaic parks.
Tsingis said a competitive tender for solar projects in Cyprus had previously produced electricity prices of around eight cents per kilowatt-hour. He also referred to data from an EAC photovoltaic park in Akrotiri, which he said indicated production costs of just over five cents per kilowatt-hour.
'New oligopoly' in renewables
According to Tsingis, the problem lies not only with electricity producers but primarily with the structure of the market and the role of suppliers.
He claimed that around 80% of electricity generated from renewable energy sources (RES) is controlled by six suppliers, some of which are also active in electricity generation.
Rather than tackling oligopolistic conditions in the electricity market, he argued, Cyprus has effectively created a new oligopoly within the renewable energy sector.
Tsingis said private suppliers focus mainly on large consumers such as hotels, factories and supermarkets, meaning households do not benefit to the same extent from the lower production costs associated with green energy.
Criticism of market arrangements
The analyst was particularly critical of the so-called transitional electricity market arrangement, arguing that it remained in place for seven years and favoured certain large photovoltaic projects.
According to Tsingis, cheaper renewable energy should be incorporated into the overall energy mix and lead directly to lower electricity bills for consumers.
He also expressed support for taxing windfall profits in the energy sector, noting that the issue has previously been raised at a political level.
He stressed that he was not opposed to business profits, but to what he described as excessive profits generated through market distortions.
Calls for regulatory changes
Tsingis also criticised regulatory and supervisory authorities, claiming they have failed to effectively address longstanding market problems.
He specifically referred to the retention of available grid capacity by projects that have not progressed, arguing that this prevents more mature projects from connecting to the electricity network.
He announced plans to send a letter to the President of the Republic calling for changes to the relevant regulations and advocating priority access for projects that are ready to proceed.
According to Tsingis, proposals already exist for the introduction of a solidarity levy on excess profits.
He argued that the debate over the cost of green energy and the extent to which consumers benefit from it should once again become a central issue in public policy discussions.
