€95 million to be allocated for the modernisation of Cyprus’s electricity grids

Approximately €95 million is planned to be invested in the modernisation of key sections of Cyprus’s electricity grids. Part of the costs will be financed through European Union funds.

The main aim of the project is to increase the capacity and flexibility of the energy system so that more renewable energy facilities can be connected and electricity storage systems developed. The project is being implemented under the Cohesion Policy Programme «Thalia 2021–2027» and is expected to be completed by December 2029.

The work includes modernising existing infrastructure, installing new equipment and digitalising the electricity transmission and distribution system. In particular, substations in Strovolos, Orounda, Akoursos, Papakosta, Ypsonas and Mari, as well as the main substation in Lanitio, are to be modernised. In addition, a new main substation will be built at the New Port of Limassol.

New power transformers, high- and medium-voltage equipment, as well as protection, remote monitoring and control systems, will be installed at the sites. The modernisation is expected to increase the grid’s capacity, eliminate existing bottlenecks and improve the reliability of electricity supplies.

A separate part of the project concerns grid digitalisation and the automation of electricity distribution. The plans include introducing SCADA/ADMS systems, establishing a National Distribution Network Control Centre, modernising substations, laying a fibre-optic network and implementing a geographic information system.

The strengthening of the grid is expected to enable more efficient use of electricity generated from renewable sources. At present, when the system’s capacity is insufficient, some of the green energy produced has to be curtailed for reasons of safety and energy-system stability.

Approximately 70% of the project’s total cost, or around €67 million, is planned to be covered by European funds through the Just Transition Fund.

The Ministry of Finance notes that this will reduce the amount of expenditure that could otherwise have been passed on to consumers through electricity tariffs.

At the same time, the investment will not lead to an immediate reduction in electricity prices. In the long term, more efficient grid operation and the ability to connect more renewable energy facilities and storage systems could make the energy system more efficient and flexible.