Renewable Energy Sources in Cyprus: The new national legislation favorable for ambitious projects

For the purposes of partial harmonization with the Directive (EU) 2018/2001 of the European Parliament and of the Council of 11 December 2018 on the promotion of the use of energy from renewable sources, the Law on the Promotion and Encouragement of the Use of Renewable Energy Sources Law of 2022 (L.107(I)/2022), came into force and replaced the previous law of 2013.

This Law establishes a common framework for the promotion of renewable energy sources determining-

(a) a binding Union target for the overall share of energy from renewable sources in the gross final energy consumption of the European Union in the year 2030; and

(b) rules for the financial support of electricity produced by renewable sources, for self-consumption of similar electricity, for use of energy from renewable sources in the heating, cooling and transport sectors, for regional cooperation between the Republic of Cyprus and the EU member states and between Cyprus and third countries, for the guarantees of origin, for the administrative procedures and for information and training.

The Renewable Energy and Energy Saving Fund, which has been established in accordance with the provisions of article 9 of the Promotion and Encouragement of the Use of Renewable Energy Sources Laws of 2013 to 2018 which, as aforesaid, have been already repealed, continues to exist and operate and has the responsibilities provided for in this Law.

The purpose of the Fund is to grant and/or subsidize various investments and/or activities promoting energy from renewable sources and energy conservation, including high efficiency co-generation, with the aim of contributing to the achievement of the binding national overall goals of the Republic of Cyprus regarding energy and climate.

In accordance with the Law of 2022 on the Operation of the Fund for Renewable Energy Sources and Energy Saving (108(I)/2022), the following investments and activities may be financed from the Fund:

(a) Sponsorship Plans in accordance with the provisions of article 5 of the above law, i.e. plans related to the provision of financial incentives in the form of sponsorship and/or subsidy for:

(i) investments in installations and equipment of energy from renewable sources;

(ii) the production or, as the case may be, the purchase of electricity produced from energy from renewable sources;

(iii) services and investments in energy saving measures and equipment and/or the improvement of energy efficiency in all sectors;

(iv) various programs to promote energy from renewable sources, including high efficiency cogeneration;

(v) investments in facilities and/or the operation of upstream or downstream electricity storage systems produced partly or entirely from      renewable sources, which are not fully integrated network elements, as well as to facilitate the participation of such systems in all stages of the electricity market; and

(vi) the production of hydrogen from renewable sources.

(b) training and enlightenment actions in matters of energy from renewable sources and energy saving upon approval by the Minister;

(c) studies and research aimed at the promotion of energy from renewable sources and energy saving upon approval by the Minister.

With the approval and entry into force of the above two new legislations in 2022, the legal framework for renewable energy sources changes (RES) to a significant extent.

With the new law, measures and policies are established for the promotion of RES and the achievement of national goals regarding their use, and in particular, rules are defined for the use of RES in the electricity, heating and cooling sectors.

In addition, the new regulations strengthen the role and participation of citizens in RES matters and introduce provisions to support the self-consumption of electricity from RES and the operation of renewable energy communities (RECs), in the context of which citizens, small and medium enterprises and local authorities can jointly participate in the development and exploitation of RES projects, bringing economic, social and environmental benefits to their community.

For more information and full legal support for projects related to renewable energy sources, contact us at info@dplawcyprus.com and +357 22272360

(photo: freepik.com)

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