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Electricity Authority Of Cyprus Invests in Dekeleia Energy Upgrade to Boost Green Power

Advancing Energy Security And The Green Transition

In a decisive move towards enhancing energy security and accelerating the green transition in Cyprus, the Electricity Authority of Cyprus (EAC/AHK) is modernizing its Dekeleia Power Station. With a substantial investment of €180 million, the authority is spearheading the installation of new generation units and advanced energy storage systems, marking a pivotal step away from aging, high-emission steam turbines.

Comprehensive Investment And Environmental Oversight

The project, which integrates state-of-the-art Open Cycle Gas Turbines (OCGT) capable of operating on diesel initially and transitioning to natural gas as it becomes available, showcases both flexibility and a clear path toward cleaner energy solutions. The initiative is currently subject to an Environmental Impact Assessment (EIA), with formal public consultations scheduled to conclude on February 28, 2026. This transparent process ensures that all stakeholders are informed as AHK modernizes its infrastructure.

Enhancing Production Capacity And System Reliability

The proposed expansion involves deploying a new OCGT unit with a capacity between 60 and 115 MWe. Designed to boost production capability and system stability, this unit is expected to significantly reduce the carbon footprint of the Dekeleia facility. Ultimately, the project aims to gradually retire the outdated steam turbines, thereby curtailing emissions and aligning with broader environmental goals.

Integration Of Advanced Battery Energy Storage

A central element of the project is a 160 MWh Battery Energy Storage System (BESS). The system is intended to stabilize the grid and enable greater use of renewable energy. It will consist of modular battery units, likely based on lithium iron phosphate or similar technology, housed in prefabricated enclosures with cooling, flame detection and fire-suppression systems.

Robust Operational And Safety Measures

The new OCGT unit and planned natural gas supply system will be located within the existing Dekeleia site, primarily on the western side of the plant. The facility operates under SEVESO safety regulations, which are designed to limit the impact of potential industrial incidents. Additional safeguards include selective catalytic reduction (SCR) systems to reduce NOx emissions and leak-prevention measures.

Financial Strategy And Broader Impacts

The modernization project is financed through the authority’s reserve resources, with significant backing from the European Investment Bank (EIB) via grants. This strategic financing not only upgrades critical infrastructure without adding to public debt, but it is also projected to yield lower electricity prices for both households and businesses. Currently, the Dekeleia Power Station contributes approximately 34.5% of AHK’s total electricity production, emphasizing its central role in Cyprus’s energy framework.

A Legacy in Transition

The Dekeleia facility, operational since 1953, has evolved from the pioneering Dekeleia A, with its early 84 MW capacity, to the larger Dekeleia B complex consisting of six conventional steam turbine units with a combined capacity of 360 MW. Supplementary internal combustion units (MEC 1 and MEC 2) further bolster production, ensuring the facility’s adaptability to rising energy demands. As the transition to modern OCGT and cleaner fuels gathers momentum, the legacy infrastructure that once defined Cyprus’s energy production is being reimagined for a sustainable future.

Looking Ahead

This transformative project underscores AHK’s commitment to a robust, reliable, and environmentally responsible energy system. With technologically advanced generation units, integrated battery storage, and rigorous safety measures, the Dekeleia Power Station stands at the forefront of Cyprus’s journey towards a cleaner and more efficient energy landscape. The strategic modernization not only meets current demands but also paves the way for the future integration of renewable sources, ensuring long-term stability and reduced environmental impact.

Cyprus Reduces Fuel Tax By 8.33 Cents As Prices Continue To Rise

The latest surge in fuel prices is putting unprecedented pressure on consumer purchasing power, forcing government intervention amid volatile global energy markets. Historic highs at the pump have compelled officials to enact further consumption tax cuts in a bid to stabilize household budgets while international trends remain unpredictable.

Government Intervention And Policy Measures

Authorities plan to approve an 8.33 cent per liter reduction in consumption tax on premium unleaded gasoline and diesel, effective from April 2026. This will be the third intervention since 2022, when fuel prices rose following the Russian invasion of Ukraine, and after a further adjustment in November 2023.

Historical Context And Comparative Analysis

Fuel prices have increased over recent years. In March 2022, premium unleaded stood at €1.442 per liter and diesel at €1.500. By November 2023, prices rose to €1.550 for gasoline and €1.709 for diesel. As of March 2026, gasoline reached €1.571 per liter and diesel €1.819. Compared with 2023 levels, gasoline prices increased by 1.8 cents per liter, while diesel rose by 10.9 cents.

Global Market Dynamics Impacting Local Prices

International benchmarks continue to influence domestic fuel prices. Brent crude remains above $100 per barrel, while the price of heavy Brent oil has increased by about 58% since February 2026. Market indicators such as the Platts Basis Italy index show increases of 52% for gasoline, 89% for diesel, and 88% for heating oil. These trends affect import costs and pricing across the local market.

Consumer Concerns And The Search For Relief

The planned tax reduction may provide short-term relief for transport fuels. Heating oil prices remain higher, reaching about €1.30 per liter, approximately 6 cents above previous levels. No tax reduction has been announced for heating fuel. According to Konstantinos Karagiorgis, reliance on private vehicles increases the impact of fuel price changes on households, given limited public transport options.

Outlook And Future Considerations

The tax reduction is expected to offset part of the recent increase in fuel costs. Consumer groups, including the Cyprus Consumer Association, have called for similar measures on heating oil. Further developments will depend on global energy prices and geopolitical conditions.

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