The Cabinet meeting was postponed from 10.30 in the morning to 4 in the afternoon, the General and the Assistant Attorney General were called to the Presidential Office to give their light, but in the end the body did not deal with the electrical interconnection, says in a publication the Liberal Cyprus.

According to the publication, the Cypriot government is not ready to ratify it agreement she made last Monday with the European Commission, the Greek government and ADMIE, as the implementing body.

And from the statements, later, of the government representative Constantinos Letympiotis, the impression is created that the Cypriot government has informally put the interconnection project in a hasty re-evaluation in terms of its usefulness for electricity consumers. This evaluation of the facts will be done hastily and without having been evaluated by a foreign firm the cost-benefit study already submitted by ADMIE and without government agencies doing theirs.

Information indicates that in this urgent re-evaluation of the data and perspectives of the Cyprus-Crete cable, the content of a very recent communication between the government and the Ministry of Finance with the European Investment Bank (EIB), which is said to be considering a new request, will be used once from ADMIE, for lending the project with hundreds of millions of euros.

“What did we ask for”

Mr. Letympiotis stated after yesterday’s Cabinet meeting that a new meeting will be held this morning. He said that clarifications were requested (without mentioning from whom) and depending on these clarifications the Ministry will probably be called upon to make decisions based on the proposal that will be submitted.

“What should be taken into account, however, is the benefit for the Cypriot consumer, the benefit for the electricity bill of each of us. And that is what is evaluated. These clarifications have been requested. As a responsible Government, with due diligence, with due responsibility, we must evaluate all these parameters and when and if the answers to the clarifications that have been requested are received and on the basis of these clarifications any informed, responsible decision will be made, with the aim of course, as I have said, I will repeat it, so that the electricity bills are not burdened, additionally, before the completion of the project” added Mr. Letymiotis.

They were not convinced of the benefit

And just the mention of the government representative that “we have to evaluate all these parameters” (for the usefulness of the project) points to the feeling of the government – and personally of the President of the Republic – that this evaluation was not done or if it was done, it is not considered sufficient.

It is inferred from the representative’s statements that the Government, at the highest level, has not reached a definitive conclusion that the interconnection will bring about reductions in the price of electricity. And he wants to find it again. It is unknown how, since it does not have in its hands an evaluation of the cost-benefit study from a foreign house, as it had promised to do.

In addition, the Government is called upon at this stage to ratify an agreement that it negotiated and participated in shaping and which only concerns the regulatory framework (in fact only on whether to start charging consumers from 1/1/2025 or whether the state will somehow pay 125 million until 2029 to cover some of the costs of the interconnection implementer). The decision that the Government is asked to take today – tomorrow does not concern its investment participation in the project.

Even if the Cypriot government decides that from ’25 consumers will not pay, either directly or indirectly, any amount before the interconnection is operational, ADMIE has a legal right to proceed with the project – if it finds investors and lenders – expecting to recover all costs after the operation of the project or at some subsequent stage of its construction. Because this is provided for by the previous decisions (regulation) of the European Commission, with the consent and participation of the Anastasiades Government, and the existing regulatory decisions of CERA.

In practice, however, it is more likely that ADMIE and the EU will react strongly if the Government avoids taking a decision to ratify Monday’s agreement, or if they announce a freeze or cancellation of the project. From the side of ADMIE, it has already become clear to the Cypriot side that the issue must be closed by tomorrow Friday.

The fear that the world will pay for something that might not happen is burning

It was not officially mentioned by any government official yesterday, but the information converges that in paragraph five of the official decision from the Ministry, the government hesitated, considering the great risk that will be taken on its part, if it gives the green light for the disbursement of money to the body implementation, without him taking the risk of the financial destruction of the investment if any intervention by Turkey leads to a wreck of the interconnection.

For its part, ADMIE is asking for the complete opposite: That the Cypriot government – directly or through CERA – and the Greek government (in the final analysis the electricity consumers) assume all the geopolitical risk. So that they can assure him from now on that he will get back all the money he will spend, if hopefully the project does not go ahead without his own responsibility.

State officials argue that paragraph 25 in the regulatory decision of 2023 (it also existed in a previous decision and was reworded in ’23), with the infamous “may”, does not protect the interests of Cyprus in the event of reversals by Turkey’s responsibility.

They believe that regardless of how the wording of the paragraph remains, ADMIE (and Nexans) retains serious rights to claim damages of millions of euros, if the project is hindered by a foreign factor or other threat.

But can the Government claim today to change the regulatory decision in order to transfer the geopolitical risk to ADMIE or elsewhere? Obviously not, without immediately wrecking the project and canceling the 657 million EU grant.