With the most important pieces in the big puzzle of the Cyprus-Greece electrical interconnection agreement still not in place, it starts at 11.00 a.m. Maximos Palace the crucial meeting of the Greek Prime Minister, Mr. Kyriakos Mitsotakis, with the President of the Republic of Cyprus, Mr. Nikos Christodoulidis, regarding the project. In Athens, according to government sources close to the negotiations who spoke to the “Economic Post”, the disappointment is evident after the decision of the Cyprus cabinet last Tuesday.
The red lines of Greece
“Red line” for Greece are two issues, for which if the two sides do not agree there will be no final agreement. The first concerns the Cypriot government taking a decision on its shareholding in the cable with 100 million euros, as was initially agreed.
However, in the text of the cabinet on Tuesday, as reported by Greek government officials, it is pointed out that the participation of the Cypriots will be taken in December, when the European Investment Bank evaluates the Cost Benefit Analysis (CBA) of the project. The reluctance to immediately take this decision is “translated” by Athens as Cyprus questioning the usefulness of the cable and signals its reluctance to continue the project.
Hard bargains for cost sharing
Also, Greece considers it a fundamental issue for Cyprus to stop questioning the 2017 agreed ratio of the two parties provided for in the cross-border cost allocation of the project (Cross Border Cost Allocation – CBCA). The Cypriot side on Tuesday set a new condition in the decision of its cabinet. According to information, the text states that, in the event that the final cost of the cable exceeds 1.94 billion euros, then the additional amount will be shared 50% – 50% between the two countries. The existing CBCA provides for a 63% apportionment for Cyprus, which benefits the most from electricity interconnection, and 37% for Greece.
The gap between the two sides
In the remaining open issues, the gap between the two sides, as reported by competent sources, can be bridged. After all, the Greek side relented in terms of sharing the geopolitical risk equally between the two countries, i.e. 50%-50% in case the electrical interconnection project is affected by external risks, which may prevent the completion of the interconnection or its operation without responsibility of the implementing body.
In exchange, he allegedly asked for Cyprus’ participation in the share capital, which was ultimately not granted. The initial distribution was 63% for Cypriots and 37% for Greek consumers.
As for the recovery of the amount of 125 million euros during the five-year 2025-2030 construction of the project (i.e. 25 million per year) the pending, despite the optimistic statements of the Minister of Energy of Cyprus Mr. George Papanastasiouappears to be maintained. And this is because in the text of the decision of the cabinet it is mentioned that the amount can reach up to 125 million euros (so it may be less).
In any case, in the last 24 hours the clouds over the Great Sea Interconnector electrical interconnection project have thickened as have the question marks as to whether “white smoke” will finally come out of Maximus today for a final agreement.
Source: ot.gr
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