Breaking news

Expert Urges Structural Reform In Cyprus’ Electricity Pricing Model

by THEFUTURE.TEAM

Urgency For A Pricing Overhaul

Energy systems expert and former Cyprus Energy Regulatory Authority chairman, Andreas Poullikkas, has underscored the imperative need to decouple renewable energy prices from the volatile fossil fuel market. As Cyprus positions itself to implement the European Target Model, this transformative step is poised to harmonize the nation’s energy policies with broader EU directives.

Unique Market Challenges

Cyprus faces distinct hurdles given its small market size, energy isolation, limited interconnection with the European grid, and heavy dependence on imported fossil fuels. Poullikkas emphasizes that these structural peculiarities can facilitate market power abuse and artificially drive up electricity prices, thereby undermining the stability and fairness of the market.

Decoupling Prices: A Strategic Imperative

Highlighting vulnerabilities exposed during the dry-run phase of recent market reforms, Poullikkas advocates for segregating renewable pricing from conventional unit fluctuations. This adjustment is essential to foster transparency, mitigate systemic risks, and ultimately stabilize the electricity market.

Proven Mechanisms To Mitigate Volatility

Poullikkas proposes the introduction of two well-established mechanisms: the ex-ante market power mitigation and the price shock absorber. The ex-ante measure, widely applied in US markets such as PJM, NYISO, CAISO, and ERCOT, leverages default energy bids based on short-run marginal cost. Any deviation beyond set thresholds automatically triggers corrective actions.

Conversely, the price shock absorber mechanism, a response to the 2022 energy crisis, continuously monitors renewable energy sources. When the accumulated inframarginal rent exceeds predefined multiples of the levelised fixed cost, the system imposes a temporary cap on conventional generation pricing, thereby decoupling the impact of soaring fossil fuel prices while allowing for adequate cost recovery.

Safeguarding Long-Term Investments

These corrective mechanisms are strictly confined to the day-ahead market, preserving the integrity of long-term contracts and forward market operations. This selective intervention ensures that renewable energy producers continue to secure stable revenues through forward contracts while benefiting from improved spot market pricing.

Implementation And Regulatory Adaptations

Transitioning to these new pricing strategies in Cyprus will involve technical adaptations, including software modifications and the development of algorithms for automatic bid monitoring. Moreover, the overhaul requires regulatory amendments, aligning the national framework with Directive 2019/944 and ensuring transparent, market-driven price controls.

Economic Impact And Future Outlook

The anticipated benefits of this reform are substantial. Lower electricity costs are expected to boost business competitiveness and alleviate household expenses, a critical advancement for an energy-isolated economy reliant on imported fuels. A phased pilot approach will allow stakeholders to address potential challenges, ensuring that these mechanisms remain adaptable to evolving market conditions.

In essence, Poullikkas’ strategic recommendations aim to craft a more predictable and robust electricity market in Cyprus, setting a benchmark for effective regulatory practices and long-term economic stability.

Cyprus Expected Working Life Reaches 39.5 Years, Above EU Average

by THEFUTURE.TEAM

People in Cyprus are expected to spend 39.5 years in the workforce, around two years longer than the European Union average of 37.5 years, according to the latest Eurostat data for 2025.

The figure places Cyprus among the EU countries with the longest expected working lives.

Cyprus Ranks Above EU Average

Only a handful of member states recorded higher figures than Cyprus. The Netherlands topped the ranking at 44 years, followed by Sweden at 43.4 years, Denmark at 42.6 years, and Estonia at 41.5 years.

At the other end of the ranking were Romania with 32.7 years, Italy with 33.0 years, Bulgaria with 34.6 years and Greece with 35.3 years.

Gender Gap Remains Wider Than EU Average

Men in Cyprus are expected to remain in work for 42.1 years, compared with 36.7 years for women. The gap of 5.4 years exceeds the EU average gender gap of 4.1 years.

Across the bloc, Lithuania, Latvia and Estonia were the only countries where women were expected to spend longer in employment than men. Finland recorded the smallest positive gender gap at 0.7 years.

Italy posted the widest gap at 8.9 years, followed by Romania at 6.9 years, Greece at 6.7 years and Malta at 6.3 years.

Working Lives Continue To Lengthen

Between 2016 and 2025, expected working life in Cyprus increased by 3.5 years, placing the country among the strongest performers in the EU over the period. Men’s expected working life rose by 3.3 years, while women’s increased by 3.6 years.

Across the EU, every member state recorded an increase. Malta posted the largest gain at 4.9 years, followed by Hungary and Ireland at 4.2 years each, and the Netherlands at 4.1 years.

Malta’s increase was driven largely by women, whose expected working life rose by 7.8 years, the biggest increase recorded across the bloc.

By comparison, Romania, Spain, Italy, Germany and Austria recorded gains of two years or less over the same period.

Women’s Working Lives Increase Faster Across Europe

Women’s expected working life increased faster than men’s in most EU countries. Denmark, Romania, Sweden and Greece were the main exceptions.

In Cyprus, gains for men and women were broadly similar, alongside Bulgaria, Belgium and Slovenia.

eCredo
Aretilaw firm
The Future Forbes Realty Global Properties
Uol

Become a Speaker

Become a Speaker

Become a Partner

Subscribe for our weekly newsletter