At the event, held at the University of Cyprus, Energy Minister Yiorgos Lakkotrypis said the consultation is very important, as the new model for the electricity market is included in the broader effort to improve the market to the benefit of consumers.
Speaking on the sidelines of the presentation, Lakkotrypis said the new model aims to incorporate renewable energy sources (RES), as well as independent energy producers into the electricity market, explaining that the point of opening the market is so that other producers can sell electricity to their customers, without having to sell to the state-owned electricity authority (EAC) – currently the sole power company.
“The new model is part of a broader effort that started last year to improve the market to the benefit of consumers, which will be achieved in various ways, including the consolidation of the EAC, the overseas connections sought by Cyprus, the change inthe energy mix, and even the practical opening of the electricity market,” he said.
Asked whether the benefit to consumers of opening the electricity market has been estimated in real numbers, Lakkotrypis said the ministry is carrying out a cost-benefit analysis, which assumes the full independence of the Cyprus Transmission System Operator (TSO).
“A cost-benefit analysis is being carried out right now, but we certainly expect increased competition in an open market, which would incur lower prices,” he said.
Lakkotrypis exalted the copious preparation carried out by the ministry, CERA and the TSO, and said CERA proposed the amendment of current regulations of theelectricity market on the basis of a hybrid model that will initially combine two successive stages, the day-ahead and the forward market.
“Shortly after the two first stages have been implemented, a third one will be introduced – the intra-day market,” said Lakkotrypis.
At the same time, he argued, increased competition arising from the new model will allow for the operation of RES on an equal footing with conventional energy generation, and the attraction of new electricity producers in addition to the EAC.
In his own address, CERA head Yiorgos Shammas said the authority’s efforts were always aimed at adopting the simplest possible and financially viable model, which would allow the maximum and speedier introduction of competitors – independent producers and renewable energy source producers.
“But the CERA’s primary concern and obligation was to offer electricity to consumers at the lowest possible price, which is expected with the introduction of competition in production and distribution, with the development of RES production,” he said.
TSO head Christos Christodoulides expressed the wish that the public consultation leads to a market framework that will promote the creation of real competition in the production and supply of electricity, promote RES, attract investment, and “most importantly, contribute to decreasing the price of electricity.”
“We will make every effort to fulfil our role so that the electricity market becomes operational by June 2016,” he said.
However, he noted that in order to achieve this goal, state support is required – namely, the Energy ministry, CERA and the House – in order to secure all necessary financial and human resources, with the first step being approving the TSO’s budget.
Source: Cyprus Mail