The protection of the semi-governmental Cyprus Electricity Authority (AHK) concerns us all

 

Article by Eleni Mavrou, AKEL Political Bureau member

Sunday 5 June 2022, “Haravgi” newspaper

At a time when you’re scared to open and see your electricity bill, what the trade union organisations of the Cyprus Electricity Authority (AHK) revealed a few days ago is provoking outrage.

In a nutshell: CERA (Cyprus Energy Regulatory Authority), the authority that supposedly regulates the proper functioning of the electricity market, recently made public two plans for renewable electricity generation that effectively exclude AHK from developing renewable energy projects for the generation of electricity power.

What does this mean? It means that AHK cannot reduce its costs either by developing its own renewable energy or by buying cheap energy from third-party renewable energy producers. And this, by extension, means that AHK isn’t given the opportunity to lower the prices of the electricity we buy.

However, CERA does give this possibility to private suppliers who, in fact, are taking advantage of the fact that AHK cannot compete, not to sell cheaper, but to maximise their profits. As a result, the benefit of cheaper electricity production does not go to the consumer, but into the pockets of a few big businessmen!

By the way, this isn’t for the first time. It is happening despite the Audit Office’s remarks that “CERA is handcuffing the Electricity Authority” and increasing its costs, and all this despite the Competition Protection Commission’s opinion issued on 31 May that AHK does have the right to operate in the renewable energy sector.

Why is this happening? Because, quite simply, the government ruling forces have put their ideological obsession through privatisations (and the economic interests they serve) at the very forefront of their policy.

They are doing so despite the fact that numerous studies (even including the one carried out by the World Bank) have shown that:

• The dogma that anything private benefits and anything public harms is not substantiated (examples abound).
• There is no documented correlation between privatization and better prices for the consumer (in fact many EU countries that have implemented the same practices have already seen the price of electricity skyrocket).
• No correlation is documented between privatisation and the provision of a better quality of service.

After the Limassol port privatisation farce and the sell-off of the Cyprus Cooperative Bank one really has to wonder with what audacity the government ruling forces continue to insist that their policies serve society or the country’s economy.

Many experts have already predicted that with the liberalization of the electricity market in the last quarter of 2022, electricity will become even more expensive, especially for residential consumers and small and medium enterprises. Furthermore, the occasional consumer subsidy, which burdens public coffers while leaving the excess profits of suppliers untouched, is not a solution.

It is no coincidence that AKEL has received no response whatsoever to the proposals it submitted months ago to the President of the Republic and Minister of Energy on the electricity market and the role that AHK should – and can – play.

Yet another semi-governmental organisation is therefore being threatened from powerful private interests. Its future, however, is tied to the interests of the country and the Cypriot people.

And we must protect it.