JRC supports Cyprus on revising network tariffs for renewable and low-carbon energy self-consumption

JRC supported the Cyprus Energy Regulatory Authority (CERA) on a revision of the network tariffs in order to promote self-consumption and also to allow a fair, cost-reflective, allocation of network costs.

Up to now oil products have been predominant in Cyprus’ energy mix leading to great dependency on energy imports. In line with EU policy targets, the Cyprus authorities aim at a much more sustainable energy system providing at the same time affordable prices to end consumers and enhanced security of supply.

The Cypriot Government promotes PV installations in residential and commercial premises – a dynamic sub-sector in renewable electricity deployment in Cyprus- through various support programmes, such as net-metering and net-billing schemes. However, these schemes should be carefully designed in order to promote self-consumption and avoid discrimination between different types of consumers regarding allocation of network costs. JRC supported CERA on a revision of the network tariffs for such installations (based on Renewables or high efficiency Combined Heat and Power) and the new regime came into effect on 28/01/2020.

Under the new CERA decision based on JRC suggestions, there is now a level-playing field between all producers of electricity, being self-consumers or other type of generators: no surcharges are paid anymore by owners of PV panels to inject their energy into the electricity network. In parallel, full network charges are imposed to the electricity withdrawn from the grid, thus avoiding discrimination against non-active customers. Overall, the new network tariffs regime promotes self-consumption and also allows a fair, cost-reflective, allocation of network costs.

JRC scientists based their proposals on the new Electricity Market Design in the context of the Clean Energy Package for all Europeans. EU policy puts customers at the centre of the transition into a more sustainable, secure and competitive energy system, empowering them, among others, to actively participate in electricity generation and promoting especially self-consumption under the "energy-efficiency first" principle. Mobilising the potential of active customers requires among others reforms in network tariffs regimes throughout the EU to provide a level-playing field among all market participants.

JRC has based its proposals to CERA on a quantitative analysis of anonymised smart-meter data, assessing the impact of different network charging schemes, providing to CERA a prototype tool for further use. This is an example of the potential of advanced metering infrastructure for making, among others, informed regulatory decisions.

Related Content

CERA Decision (only in Greek)