articles | 07 December 2015

EAC privatisation no longer on the table

Energy Minister George Lakkotrypis said in an unexpected turn of events that the Electricity Authority of Cyprus (EAC) ought to remain fully in state hands but the administrative split of the organisation will move ahead.

EAC administration and union members met with President Nicos Anastasiades, along with Energy Minister George Lakkotrypis, in an effort by the administration to prevent a strikeand possibly power outages.

Lakkotrypis said the discussion will move forward, adding very unexpectedly that the privatisation option is no longer on the table. Removing the privatisation option comes two months after the Cyprus government had received advice on a partial privatisation and institutional split of the EAC. The consulting company, Exergia, had stated that any amount of privatisation could have worked successfully if there was healthy competition in the market.

Under Lakkotrypis’ initial plan, the EAC would be split into two entities, the network on one hand and production and supply on the other, but the state would maintain majority control of shares while private investors would be able to acquire the rest.

While the privatisation scenario had been removed for the EAC, Lakkotrypis said an administrative split of the organisation will go forward. Such a move is also supported by international lenders, which has spoken in favour of a better business model for the EAC.

The workers had threatened to go on strike last Friday but were persuaded to abort their measures in exchange of getting a private audience with the President.

There was no update on union plans to strike, but a representative stated that union officials would meet with EAC administrators to figure a way forward until a mutually agreeable solution is reached.

Source: InCyprus

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