The Parliament of Cyprus approved legislative amendments aimed at regulating the timelines for implementing electricity generation projects and developing energy storage systems. The bill was initiated by DISY party MPs Kyriakos Hadjiyiannis and Nikos Sykas, Famagusta district MP Michalis Yakoumis, and the head of the Ecologists movement Stavros Papadouris.
During the vote, the document received the support of the majority of parliamentarians: 21 MPs voted in favor, while 13 voted against. Representatives of the AKEL party and Nicosia MP Irene Charalambidou did not support the initiative. The adopted amendments concern regulation of the energy market and are aimed at accelerating the implementation of renewable energy projects, as well as increasing the transparency of processes for connecting new facilities to the country’s energy system. The law became part of a broader strategy of Cyprus to modernize its energy infrastructure and gradually reduce dependence on fossil fuels.
Extension of licenses for energy projects
According to the new rule, the Cyprus Energy Regulatory Authority receives the right to extend the validity of licenses or exemptions issued for the construction of power plants and energy storage facilities. Such a decision may be made at the request of the investor if justification is provided and the investor’s technical and financial capacity to implement the project is confirmed.
One of the mandatory conditions is that the investor must pass through the “one-stop shop” service, which was created to simplify administrative processes in the energy sector. This should reduce bureaucratic delays and accelerate the implementation of infrastructure projects.
The extension of a license may be granted for a maximum of one year at a time, while the total duration of such extensions may not exceed five years. This measure is intended to give investors more time to complete projects that often face delays due to permitting procedures, shortages of equipment, or problems connecting to the grid.
New rules for connection to power grids
The law also establishes additional requirements for projects seeking connection to the national energy system. Already at the first request for a license extension, investors must provide information about an application submitted for connection to the grid. For subsequent extensions, confirmation will be required that the network operator has already issued a technical proposal for connection.
In addition, electricity distribution and transmission system operators will be required to publish information on the order of priority for connection applications. Such data must be displayed separately for each substation node and must cover both projects for electricity generation from renewable sources and energy storage systems.
This measure is aimed at increasing market transparency and reducing conflicts among investors who previously faced non-transparent rules for the allocation of grid capacity.
Priority for ready projects and energy storage systems
According to the new regulatory model, the connection of energy projects will be carried out based on maturity criteria that will be developed by the Ministry of Energy of Cyprus after consultations with the regulator and energy system operators.
It is expected that priority will be given to projects that are already at an advanced stage of readiness and can begin generating electricity in a short period of time. Particular attention is given to facilities that combine renewable energy generation with energy storage systems, such as battery stations. Such projects are considered key for the stability of the energy system because they help compensate for fluctuations in solar and wind energy production.
Restrictions on reserving grid capacity
One of the important innovations is the rule according to which electrical capacity in transmission and distribution networks will not be reserved for projects that have not received all necessary permits and approvals. This decision is intended to prevent situations in which grid capacity is effectively “frozen” by projects that are not implemented for many years. The freed capacity can then be used by more advanced projects, which will accelerate the development of renewable energy on the island.
The law also introduces rules for cases when the system operator is forced to limit electricity generation for reasons of safety and grid stability. Such restrictions are sometimes applied to solar power plants during periods of excess generation.
In addition, any changes to the ten-year electricity network development plan must now be submitted for public consultation in advance. This approach is intended to ensure the participation of industry companies and experts in planning future infrastructure.
A separate provision also allows part of the capacity of transformer substations to be reserved for renewable energy projects implemented by consumers themselves—for example, companies or households installing their own solar panels. The specific criteria for allocating this capacity will be determined by the Minister of Energy.
Cyprus’s energy transition in 2025–2030
The adoption of the law takes place against the backdrop of Cyprus’s accelerated energy transition. In recent years, the country has been actively investing in solar generation, as the island has one of the highest levels of solar radiation in Europe. According to the Ministry of Energy, the share of renewable sources in electricity production in Cyprus continues to grow and may increase significantly in the coming years thanks to new solar plants and the introduction of energy storage systems. These technologies are expected to reduce electricity costs, improve the resilience of the energy system, and bring the country closer to the climate goals of the European Union. The adopted legislative changes are considered an important step toward attracting investment in energy infrastructure and accelerating the implementation of projects that will help Cyprus transition to a more environmentally friendly and modern energy model.