PARLIAMENT yesterday approved legislation stripping the energy regulator of the right to issue private licences for natural gas supplies, allowing authorities to control future imports.
The amendments submitted by DISY and AKEL, affect the law regulating the Cyprus market for the introduction of liquid natural gas. They were approved by the Plenum amid heated discussions.
Among other changes, the law stripped the Cyprus Energy Regulatory Authority of the ability to issue licensing for private companies to trade in LNG.
The legislation is the first step in declaring the Cypriot market “emerging”, a status which would allow the island to control supplies through the creation of a public utility company, or a preferred supplier.
The alterations were approved with 32 votes in favour (AKEL, DISY, EDEK and the Green Party), while the eight DIKO deputies that were present abstained.
The bill regulating the LNG market was approved unanimously, with just one abstention – that of EDEK’s Marinos Sizopoulos.
The legal provision to circumvent the energy regulator came after angry debates in parliament regarding the future of the market, and misgivings from the government about excluding the watchdog.
“Parliament and the government had the same aim, to declare the market emerging. But in the government’s case, it wanted the regulator to maintain its role in being able to issue, and to revoke licences, and declare the market emerging once the natural gas got here,” a government source told Reuters.
Cyprus has set up a public utility, known as DEFA, which would be allowed to import and sell gas.
Charilaos Stavrakis, chairman of the EAC, said it would hold a 39 per cent stake in DEFA.
Parliament’s decision, he said, effectively endorsed the views of the EAC which had disagreed with the issuing of private licences in the interim period before DEFA became fully operational.
A heated debate broke out between DISY leader Nicos Anastassiades and DIKO deputy Nicolas Papadopoulos during the discussion, prompted by the former’s claim that the bill’s approval would avert a second crime.
“The first crime was the delays in the transfer of natural gas, which were loss-making for the consumers,” he said.
Anastassiades also stressed that Papadopoulos should not participate in the procedure due to his involvement in his father’s law firm in the registration of certain companies.
In response, Papadopoulos pointed out that Anastassiades’ law firm had made millions from the registration of many other companies.
“I dare Mr Papadopoulos to submit evidence on at least one company of my law firm that had anything to do with public offers – to prove it or else what he is saying is slander,” said Anastassiades, adding: “If something like that is really happening, I will apologise and resign from politics”.
Meanwhile, the unions of the Electricity Authority of Cyprus (EAC) yesterday expressed their satisfaction over the Plenum’s decision.
Speaking on behalf EAC union SEPAIK, Sotos Savva said: “The amendments that were approved comply totally with what all the experts had said.”
He added that the newly passed law made no mention to the creation of an offshore LNG terminal.
The EAC has been against the creation of an offshore terminal, while the government has promoted an exploration of the option, while a land-based unit is being built.
“Based on the legislation passed today, things have changed. All that remains now is a political decision by the government to appoint a company for the introduction and sale of natural gas in Cyprus, through a land-based terminal,” Savva concluded.
Cyprus now relies solely on heavy fuel oil to fire its energy grids, but is under commitment to the European Union to introduce natural gas by 2009.
“This [legislation] closes a loophole which could have been exploited at the expense of the EAC,” Stavrakis told Reuters.
The island needs to wean itself off its reliance on heavy fuel oil firing its power grids, emitting carbon dioxide blamed for climate change.
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