{"id":10709,"date":"2026-07-16T08:31:38","date_gmt":"2026-07-16T05:31:38","guid":{"rendered":"https:\/\/newsfire.gr\/en\/?p=10709"},"modified":"2026-07-16T08:31:38","modified_gmt":"2026-07-16T05:31:38","slug":"former-cera-chief-gsi-costs-wont-auto-raise-power-bills","status":"publish","type":"post","link":"https:\/\/newsfire.gr\/en\/former-cera-chief-gsi-costs-wont-auto-raise-power-bills\/","title":{"rendered":"Former CERA Chief: GSI Costs Won’t Auto-Raise Power Bills"},"content":{"rendered":"

Andreas Poullikkas<\/strong> explained that public discussion of the multi-billion euro Great Sea Interconnector frequently fixates on headline costs or assumes consumers will inevitably shoulder the entire financial burden, yet the actual regulatory architecture is far more sophisticated and tightly controlled than commonly understood.<\/p>\n

As a designated Project of Common Interest under European Union guidelines, the Great Sea Interconnector operates under European rules that prevent arbitrary or one-dimensional cost recovery, the former regulatory authority chairman noted. Instead, the framework combines market-generated revenues, regulated tariffs, and a cross-border cost allocation mechanism to distribute financial responsibility.<\/p>\n

Cost Recovery Framework Follows Benefit Principle<\/h2>\n

The fundamental question is not merely the total project cost, but rather which nations benefit, what proportion each country assumes, how much revenue the interconnection itself generates through operation, and what residual amount, if any, must ultimately be recovered through electricity tariffs, Poullikkas outlined.<\/p>\n

European regulatory requirements mandate that all European grants or subsidies be subtracted from the project’s overall cost before any regulated recovery begins. Only the remaining net amount then proceeds through a two-stage recovery process.<\/p>\n

The first recovery source comes from the electricity market itself through revenues generated by allocating cross-border transmission capacity, commonly termed congestion rents, under European Union Regulation 2019\/943. The cross-border cost allocation mechanism activates only if those market revenues prove insufficient.<\/p>\n

Cyprus and Greece Share Costs Based on Net Benefit Analysis<\/h2>\n

Under European Union Regulation 2022\/869 governing Projects of Common Interest, national regulatory authorities allocate remaining costs between countries deriving net benefits from the project, rather than simply following geographical proximity.<\/p>\n

This principle has already been applied to the Greece-Cyprus electricity interconnection. Based on studies and the investment dossier submitted under European regulation, regulatory authorities concluded that both countries would benefit from the project, though not equally.<\/p>\n

Consequently, the cost of the Cyprus-Crete section is allocated at 63 percent for Cyprus and 37 percent for Greece, Poullikkas explained. However, this ratio does not mean either country immediately pays that amount in cash, nor does it automatically transfer the entire burden to households.<\/p>\n

Instead, the allocation determines how the eligible recoverable cost of the cross-border section is shared according to net benefits identified in regulatory studies.<\/p>\n

Market Revenues Offset Consumer Tariff Impact<\/h2>\n

In a simplified illustration, if annual allowed revenue requiring recovery totaled 10 million euros, then under the 63-37 allocation, 6.3 million euros would correspond to one country and 3.7 million euros to the other. Yet those figures still do not automatically translate into electricity bill charges because revenues generated by the electricity market are deducted first.<\/p>\n

Regulators first determine the annual allowed revenue required by the project promoter to cover operating costs, depreciation, and a reasonable return on the regulated asset base. They then subtract revenues generated through interconnection operation, primarily from auctions of transmission capacity.<\/p>\n

If market revenues are sufficiently high, they reduce the amount requiring recovery through regulated network charges. If market revenues fall short, only the remaining balance is recovered through national network tariffs under each country’s regulatory framework.<\/p>\n

Each member state establishes its own revenue requirement after accounting for operating costs, its share of capital expenditure, revenues from transmission capacity sales, and any grants received.<\/p>\n

Misleading Claims About Consumer Burden<\/h2>\n

Assertions suggesting consumers will pay the project’s full cost are misleading, Poullikkas emphasized. European funding, cross-border transmission capacity revenues, the allocation of costs between countries, and national regulatory methodology all intervene before tariffs are affected.<\/p>\n

In hypothetical scenarios, if the project required 10 million euros in annual revenue and the electricity market generated the same amount, the entire requirement would be covered through market revenues with nothing recovered through consumer tariffs. If market revenues covered only half, the remaining 5 million euros would be allocated between countries according to the benefit-sharing ratio, with each nation recovering its share through its own regulatory framework.<\/p>\n

The European regulatory architecture governing Projects of Common Interest thus provides multiple layers of consumer protection, ensuring that market mechanisms absorb significant portions of project costs before any impact reaches household electricity bills.<\/p>\n

With information from Cyprus Mail<\/a><\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

European regulatory safeguards ensure Greek and Cypriot consumers won’t automatically face higher bills from the Great Sea Interconnector as costs are recovered through market revenues and cross-border allocations.<\/p>\n","protected":false},"author":39,"featured_media":10708,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[122],"tags":[9368,213,9369,9370,159,9367,100],"nfg_topic":[134],"class_list":["post-10709","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-andreas-poullikkas","tag-cyprus","tag-electricity-tariffs","tag-energy-regulation","tag-european-union","tag-great-sea-interconnector","tag-greece","nfg_topic-europe"],"_links":{"self":[{"href":"https:\/\/newsfire.gr\/en\/wp-json\/wp\/v2\/posts\/10709","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/newsfire.gr\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/newsfire.gr\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/newsfire.gr\/en\/wp-json\/wp\/v2\/users\/39"}],"replies":[{"embeddable":true,"href":"https:\/\/newsfire.gr\/en\/wp-json\/wp\/v2\/comments?post=10709"}],"version-history":[{"count":1,"href":"https:\/\/newsfire.gr\/en\/wp-json\/wp\/v2\/posts\/10709\/revisions"}],"predecessor-version":[{"id":10716,"href":"https:\/\/newsfire.gr\/en\/wp-json\/wp\/v2\/posts\/10709\/revisions\/10716"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/newsfire.gr\/en\/wp-json\/wp\/v2\/media\/10708"}],"wp:attachment":[{"href":"https:\/\/newsfire.gr\/en\/wp-json\/wp\/v2\/media?parent=10709"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/newsfire.gr\/en\/wp-json\/wp\/v2\/categories?post=10709"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/newsfire.gr\/en\/wp-json\/wp\/v2\/tags?post=10709"},{"taxonomy":"nfg_topic","embeddable":true,"href":"https:\/\/newsfire.gr\/en\/wp-json\/wp\/v2\/nfg_topic?post=10709"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}