Cyprus must upgrade grid for wind and solar

By Dr. Charles Ellinas

Cyprus must upgrade its electric power grid to take full advantage of wind and solar renewables.

With the EU Green Deal in place and net-zero carbon emissions by 2050 about to be enshrined into European law, renewable energy sources (RES) – solar and wind – are gaining ground in becoming Europe’s primary energy sources.

The extent of RES penetration in power generation will gain additional momentum once – as expected – the European Council approves the target to achieve 55 per cent cut in carbon emissions by 2030, in comparison with 1990 levels.

On the basis of these developments the European Commission intends to review each 2021-2030 National Energy and Climate Plan (NECP), including that of Cyprus, and make concrete recommendations to national governments on how to improve them in line with the new emission targets. It will then start checking member states’ progress towards achieving the new climate targets from June 2021.

This is expected to have a profound, and unavoidable, impact on Cyprus’ NECP, with a significant increase in the target to cut carbon emissions by 2030, currently at 24 per cent, and in the implementation of RES, currently at 23 per cent. Both will need to increase significantly.

In a recent article, Andreas Poullikkas, chair of the Cyprus Energy Regulatory Authority (CERA), suggested that Cyprus may have to increase its RES target to 30 per cent of total primary energy by 2030 and to 75 per cent by 2040.

These are ambitious targets that, he states, will require the setting-up of “an institution which will be the link that will coordinate all the actions by the various Ministries, so that with transparency and proper planning it is possible to prepare a comprehensive long-term, science-based, NECP, including political and social consensus.”

In order to achieve such targets, there will be a need for major improvements in electricity systems, operations, market design, business models and regulations so that adoption of RES receives the priority and support it deserves.

A starting point is Cyprus’ electricity grid, often cited as the bottleneck limiting the amount of RES that can be integrated at any one time due to the variable nature of renewable electricity –  generating electricity only when the sun is shining and the wind is blowing.

These issues were considered in a RES roadmap prepared by the International Renewable Energy Agency (IRENA) in 2015, but still valid. It concluded that RES could provide 25-40 per cent of Cyprus’ total electricity supply in 2030, mostly through solar power but also biomass and wind, with solar power offering the greatest potential.

IRENA also commented on the need to strengthen the grid and for putting in place interconnectors to neighbouring countries that could help reduce the technical challenges of integrating a high share of variable renewables into the power grid.

An interconnector – with Euro-Asia and Euro-Africa now looking more likely – introduces flexibility allowing more variable renewable energy to enter the power generation mix. Additional electricity storage combined with smart grids would have a similar effect.

Critical also is the introduction of a truly liberalised electricity market, with a functioning TSO and DSO, even possible including energy aggregators. This is not yet the in place. After 5-years of delays, the TSO now says that the required software will not be ready before the end of 2021.

Cyprus hopes to receive close to €1billion in grants from the European Recovery Plan, with the condition is that over one third of these funds should be earmarked for green projects. This presents a golden opportunity to upgrade, reinforce and reconfigure the electricity distribution network and transition to a smart grid to promote implementation of RES at a much larger scale than planned so far.

This can bring electricity costs down, but also help Cyprus meet its new renewables and emissions targets. The International Energy Agency warned in its latest World Energy Outlook that growth of renewables could be undermined by inadequate grid investment. This is exactly what is happening in Cyprus.

Interest by companies, including financial institutions such as EBRD, to invest in renewables in Cyprus, especially solar power, abounds. What is holding it is the inadequacy of the grid system, but also the political will to commit wholeheartedly to clean energy at the expense of fossil fuels.

This can be supported by Cyprus’ universities and institutions where pioneering, innovative, research is being carried out, for example at UCY’s FOSS Research Centre for Sustainable Energy, CyI’s CSP-DSW project, the Helios Power project, the EOS Green Energy project, to name but a few.

Cyprus energy sector is in need of reform that in any case will be required in view of the EU’s prioritisation of clean energy and net-zero emissions. Cyprus should take its cue from Greece. Its NECP requires renewables to supply 35 per cent of final energy consumption in 2030, including a massive 61 per cent of the country’s electricity consumption. It has also committed to reduce carbon emissions by 55 per cent by 2030 in comparison to 2005.

In 2019 Cyprus produced a meager 0.2 TWh electricity from solar PV, in comparison with 4 TWh by Greece. Instead of being a laggard, Cyprus has the potential to become a solar power leader in Europe. One area where Cyprus does well is on the use of rooftop-installed PV panels by households, mostly for hot water but increasingly also for electricity generation. This scheme may benefit from EU Recovery Plan funding.

The decisive turn to clean energy, renewables and decarbonisation in Europe, combined with funds from the EU Recovery Plan, provide Cyprus with a unique opportunity to unlock potential and increase RES ambition. And in process in can bring emissions and electricity costs down.