The Cyprus Energy Regulatory Authority (CERA) has not yet reached a final decision regarding an increase in electricity prices. According to George Petrou, Chairman of the Board of the Electricity Authority of Cyprus (EAC), the delay is due to the complexity of the procedures and calculations involved.

As Brief reports, speaking before the Parliamentary Energy Committee, which is currently examining the upcoming electricity tariff adjustment and its potential impact on households and businesses, Petrou stated that based on data submitted by EAC to CERA, the proposed increase should amount to 7.5%. He explained that this figure consists of a 5% increase attributed to 2023 and an additional 2.5% projected for 2025—a figure reportedly accepted by CERA.

However, a proposal presented to Parliament has suggested limiting the increase to just 3%.

Petrou added that the audited accounts for the year are not yet ready, which prevents the Authority from pursuing the increase at this stage.

CERA President Polyvios Lemonaris noted that any adjustments for 2024 will be reflected in the increases scheduled for 2026.

Lemonaris further elaborated on the methodology used to calculate the tariffs, describing it as both complex and time-consuming. Nevertheless, he emphasized its importance as a fundamental regulatory tool, especially in sectors characterized by natural monopolies, such as electricity transmission and distribution networks.

To address these challenges, CERA has established a specific methodology designed to ensure transparent, fair, and reasonable pricing for regulated energy services. This framework defines the maximum allowable revenue for each activity, integrating mechanisms that strike a balance between encouraging investment and protecting consumers from undue financial burdens.

The authority also evaluates whether the requested revenue is reasonable, taking into account any positive or negative adjustments based on audited financial statements, with the target return set at 4.6%. Following this assessment, CERA approves the amount each activity is allowed to recover in the following year.

Only capital investments that have been implemented and are commercially operational are included in the allowable revenue figures.