Cyprus is evaluating the Great Sea Interconnector (GSI) with skepticism about whether it will actually lower electricity prices for Cypriot consumers, amid technical, financial, and political complexities.

Cyprus supports the GSI in principle but will decide on participation in its capital after the European Investment Bank completes a viability study expected by year-end, while considering updated costings and a detailed business plan.

The Council of Ministers in early 2024 underscored the project’s geopolitical importance but tied progress to due diligence, revised costings, and a viable business plan.

There is internal discord over framework agreements, suggesting possible policy shifts as unanswered questions cast doubt on how the government intends to proceed.

High-level engagements with Athens and Brussels are planned to advance the interconnector agenda and secure broader support.

Cyprus’ commitment to involvement is asserted as definite, countering claims that the project could proceed without Cyprus.

Energy Minister Damianou stressed the GSI’s role in energy adequacy and security, with Meridiam’s stake bringing momentum but more investors are needed.

Cyprus maintains a cautious, risk-averse stance to avoid accountability for potential costly missteps, aligning with historical policy patterns.

The 3+1 format (Greece, Cyprus, Israel, United States) and ties to the India-Middle East-Europe Corridor may constrain Cyprus’ diplomatic flexibility and heighten dependence on a fragile Eastern Mediterranean backdrop.

A decision on state participation remains pending pending updated financial data and viability clarity, given potential impacts on public finances and EU spending rules.

Critics argue the government stalled earlier plans from 2013-2023 on renewables and storage, contributing to higher electricity costs and occasional supply issues.

Meridiam’s 66% stake has added certainty but raised concerns about protection of the cable and reliance on European contractors.