Commitment of the Minister of Energy to reduce electricity costs in businesses

Screenshot 6 1 Government, MINISTER OF ENERGY

A new commitment that the Government will try, through short and medium-term measures, to reduce the cost of electricity, which is one of the biggest costs for businesses and industries, was given on Monday by the Minister of Energy, Trade and Industry, Giorgos Papanastasiou, addressing the event to kick off Industry week.

The contribution of the industrial sector to the Cypriot GDP, despite the continuous challenges of recent years, increased from 8,1% in 2020 to 8,5% in 2022. At the same time, employment in the sector in 2022 rose to 9% of the workforce, from 8,1% in 2020, while exports in 2022 were set at €1,6 billion.

Both in his greeting and in statements after the event, Mr. Papanastasiou acknowledged that due to the conditions prevailing in Cyprus, the cost of electricity is one of the biggest burdens faced by businesses and industries.

"I think that in industries one of the highest costs is electricity and we will try to find ways either in the short term or in the medium term to give solutions to the industries so that they can be profitable and sustainable and not only that but other production industries in Cyprus", he emphasized.

In his speech, Mr. Papanastasiou highlighted, among other things, the photovoltaic project for businesses, which was initially started to support hotel units, while it was then extended to all businesses.

As he said, in the new plan we have allowed for virtual netting, with the power from 150 kilowatts increasing to 0,5 Megawatts without storage, while the plan power from 0,5 MW has gone to 1 MW with storage.

"This plan gives a good boost for those who can choose it for the purposes of electricity production but also for self-consumption, realizing that the issue of electricity is probably one of the biggest costs for businesses," he said.

€14,4 million for the transition to the circular economy
Mr. Papanastasiou also said that an important part of our Industrial Policy until 2030 is also the actions we take to transform our economy into a green and circular one.

For this purpose, he said, the Ministries of Energy and Agriculture, together with the Deputy Ministry of Research, have collaborated to prepare the National Action Plan for the Circular Economy, in the context of the valuable work being done in Technical Committee 10, of the National Governance System for European Green Deal.

He also noted that the Ministry of Energy, Trade and Industry has already prepared a draft of the Plan Guide, which is now before the General Directorate of Development and the competent Technical Committee, for final evaluation and approval. As he said, the goal is to announce the plan at the beginning of 2024, which concerns sponsorships to small and medium-sized businesses totaling €14,4 million, for the implementation of investments that will allow them to switch to a circular business model.

Through the Plan, he said, it is expected that more than 40 small and medium enterprises will receive support, with a maximum amount of funding of 400.000 euros and an intensity of aid that reaches 50% of the investment.

Besides, speaking on behalf of the Minister of Agriculture, Rural Development and the Environment, the Director General of the Directorate General for the Environment, Kostas Hatzipanagiotou, stated that the transition to a green circular economy is the EU's new development strategy for a modern and efficient Europe in terms of the use of resources and waste.

Our collaboration with the Ministry of Energy and Industry to create the first comprehensive National Action Plan for the Circular Economy in the context of a climate neutral and circular economy is important, as solid pillars and timelines for implementation have been defined, he added.

The action plan, he concluded, aims to contribute to the development of the industry, while also promoting new business models and supporting the circular design of production processes and products and the most efficient way of consuming them.

€110 million plans within 2023 and 2024
At the same time, Christos Fotiadis, Director of the Industry and Technology Service at the Ministry of Commerce, referred to the provisions of the new Industrial Policy 2019-2030 and the progress in its implementation, with the aim of increasing the sector's contribution to the economy and further strengthening innovation and increasing of exports.

As he said, exports are a fact that marked a huge increase from €962 million in 2016 to €1,6 billion. in 2022 recording an increase of 14,5% in the said period, while the first half of this year saw an annual increase of 6%.

Mr. Fotiadis referred to the projects, with a total budget of approximately €110 million, which will be implemented starting from December until the end of 2024.

This is the plan for energy upgrading and strengthening the competitiveness of large businesses with €17 million, the plan for new business activity with €10 million, the plan to save/upgrade homes with €40 million, which indirectly also supports businesses

Also expected is the sponsorship plan for the creation, modernization and digital upgrade of agricultural products processing and/or marketing units with €3 million, the plan for digital upgrading of businesses with €10 million, the plan for processing and marketing in the agricultural sector (status 4.2) with €10 million, while the plan for the creation and development of partnerships (clusters) with €5 million was included as a new project.

Regarding the plan for the Circular Economy, amounting to €14,4 million, Mr. Fotiadis emphasized that the Ministry has prepared the first draft and has received the comments from the General Directorate of Development of the Ministry of Finance.

He noted, however, that because the plan is linked to the Recovery and Resilience Plan, there is a time limit for the actions, adding that until June 2026, if no extension is given, not only the grants should be implemented but also paid.

Source: KYPE