Mitsotakis after Meridiam buy-in: Interconnector will end Cyprus’ energy isolation

Greek Prime Minister Kyriakos Mitsotakis on Wednesday declared that the planned Great Sea Interconnector project will “end Cyprus’ energy isolation”, after French asset management firm Meridiam took a controlling stake in the project’s holding company. “The project will put an end to Cyprus’ energy isolation and strengthen the energy security of the eastern Mediterranean and Europe’s resilience in the energy sector. We are joining forces for a European project of common interest,” he said at the buy-in’s signing ceremony, which was held at the Maximos Mansion, his official residence in Athens. He added that Meridiam’s buy-in constitutes “a strong vote of confidence in Greece’s energy sector” and said that “the participation of one of the largest European investment groups creates a new state of affairs for the project’s development”. Wednesday’s deal sees Meridiam take control of a majority stake in the interconnector project, which, if completed, will connect the energy grids of Cyprus, Greece, and Israel, with the project previously having been majority owned by Greece’s independent transmission system operator, Admie. Admie had taken over the running of the project from Cypriot-owned firm EuroAsia Interconnector Ltd in October 2023, with the company then being wound down. In total, the construction of the interconnector is expected to cost almost €2 billion, of which around €658 million was to be provided by the European Commission. The interconnector project was first announced in 2012, but progress has largely been slow since then, despite the European Commission declaring it a project of common interest the following year. In response, a rival interconnection project was touted by Turkey and the Turkish Cypriot authorities, which foresaw a cable being built to link the island’s energy grid with that of Turkey, with Turkey and the Turkish Cypriots stating that their own planned cable would be quicker and cheaper to construct. Turkey, like Greece, is interconnected with the wider European grid, but the European network of transmission system operators for electricity (Entso-E) has not included plans for a cable linking Turkey and Cyprus in its ten-year development plan. It also said that the Great Sea Interconnector “is the only interconnector project connecting the Republic of Cyprus” in its plans, and added that it “will not consider any project for inclusion in the [development plan] that would be proposed or developed without the consent of the Cyprus [transmission system operator] TSO”. It added that the Republic of Cyprus’ TSO is “the sole transmission system operator certified for the entire territory of the Republic of Cyprus under EU law”. More recently, the governments of the Republic of Cyprus and Lebanon last month agreed to prepare a preliminary feasibility study regarding the possibility of the connection of the two countries’ electricity grids. The agreement was reached by Cypriot Energy Minister Michael Damianos and his Lebanese counterpart Joseph Al-Saddi, with both governments saying that it “marks an important milestone in the cooperation between the two countries”. They said it is “aimed at exploring opportunities to strengthen regional energy connectivity, enhance energy security, and promote sustainable economic development in the eastern Mediterranean”.