The European Commission has given assurances that it will use “all the diplomatic means at its disposal” in order to protect the Great Sea Interconnector (GSI) after reports this week revealed the project was being monitored by Turkey from a distance.
According to the Cyprus News Agency, the Commission’s General Directorate of Energy gave its assurances in an official letter after a research vessel conducting surveys of the seabed for the proposed subsea electricity cable was being monitored by the Turkish navy.
It was not clear to whom precisely the letter was addressed, although the Cyprus Mail was able to confirm such a communique was sent by the European Commission. It’s also understood that the written communique followed earlier verbal assurances regarding the same matter.
Greek media reported that the Italian-flagged Ievoli Relume was on Monday carrying out a new round of surveys near Kasos, the southernmost island in the Aegean Sea.
While turning towards the direction of Crete, a Turkish frigate was spotted on radar. However, the Turkish ship – sailing in international waters – kept its distance, at approximately 25 nautical miles from the Ievoli Relume.
Previously, on July 22 and 23, the same survey vessel had drawn the attention of Turkish gunboats. In response, the Greek Navy dispatched its own ships to the area. The matter was resolved diplomatically.
The Commission’s assurance letter states that the GSI is a project of common interest under EU Regulation 2022/869 concerning the trans-European energy infrastructures and is included in the EU’s list of projects of common interest (PCi) adopted in November 2023.
As part of that, the project received a multi-million subsidy through the Connecting Europe Facility. Based on these facts, the Energy Directorate promises in the letter that “the European Commission will use all the diplomatic means at its disposal to protect against the geopolitical risk mentioned.”
The geopolitical risk to the GSI has caused the project promoter – Greece’s independent power transmission operator or Admie – to seek ironclad guarantees of full reimbursement in case of the abandonment of the project due to reasons beyond their control, such as hostile acts by the Turkish navy.
Such compensation for expenses was alluded to in a decision issued by the Cyprus energy regulator in 2023, at a time when a Cypriot private company was still the project promoter. That decision stated that, in the event of events beyond the promoter’s control, the promoter “may” recoup the expenditures made until the point of scrapping the project.
But the wording may be ambiguous, which is why Admie now wanted a more explicit commitment in writing.
In terms of financing for the project, end of August is seen as a crucial deadline. By then Nexans – the manufacturers of the subsea electricity cable – expect to receive from the project promoter a ‘final notice to proceed’. By issuing such a notice to the contractor, Admie would undertake full liability for the entire amount of the €1.4 billion estimated cost of the cable.
But Admie has concerns that it cannot undertake such liability unless and until a steady revenue stream is guaranteed. Greece’s own energy regulator has agreed that Greek consumers will pay a fee towards the construction of the project starting in January 2025. However, Cyprus’ own energy regulator argues that Cypriot consumers should not chip in before the cable goes live – expected in 2030.
The Cypriot regulator is under pressure to revise that decision.
Financing for the Crete-to Cyprus segment of the interconnector is split at 33 per cent for Greece, 67 per cent for Cyprus.
