Progress in Crete-Cyprus Electricity Interconnection Talks: Key Issues and Anticipated Agreement

Discussions among the stakeholders in the Crete-Cyprus electricity interconnection project seem to be making progress following a recent meeting led by the Cypriot President. The primary focus now is on resolving concerns raised by the Cypriot side to finalize the agreement.

The Greek side submitted the final draft of the agreement to Nicosia on Wednesday night, and the Cypriot response is anticipated. If developments proceed as planned, the agreement might be officially announced on Friday. This would allow the Cypriot cabinet to make a political decision, and then the Cypriot energy regulator (RAEK) would address any remaining regulatory matters.

Cypriot Energy Minister George Papanastasiou has highlighted the project’s significance for Israel, citing its potential to bolster regional energy security.

Key issues include managing geopolitical risks and recouping the €125 million project cost over five years. Nicosia is reportedly prepared to invest €100 million in equity for the Great Sea Interconnector, with the remaining details still under negotiation. In exchange, Greece will take on 50% of the geopolitical risk, a shift from the previously agreed split of 37% for Greece and 63% for Cyprus.