The urgent need to create large Electricity Storage Facilities (ESF) with batteries that will be charged with cheap electricity during periods of sunshine and discharged at night, putting pressure on the high prices that prevail during the night hours, when the market depends to a much greater extent on the conventional production of the EAC Generation, has been underlined by the CEO of Bioland Energy Ltd, Demetrios Constantinides.
In an interview with InBusinessNews, Constantinides elaborates that the batteries will allow the utilisation during the evening hours of the energy produced by photovoltaic systems, which is currently limited or discarded.
He explains that the company's goal is to expand its services to residential consumers. "Today, the high cost of energy supply during the evening hours does not yet allow us to set the competitive tariffs we would like for this specific category of consumers," he notes, expressing the assessment that, with the development of storage, this will soon be able to change and allow Bioland Energy to dynamically enter the residential consumer market.
According to the CEO of Bioland Energy, what will relieve everyone- businesses and households- is the reduction of the price of electricity as soon as possible and this can only be achieved through a truly Competitive Electricity Market, indicating that today the Competitive Electricity Market unfortunately operates without substantial competition due to the fact that, for most of the 24 hours, the need for electricity is satisfied exclusively by a single conventional producer.
Moreover, Constantinides emphasises that the procedures for the first 24 photovoltaic parks in which ESF installations (batteries) will be integrated are at a very advanced stage, with the first four PV parks having already secured the final connection terms and their technical inspection and trial operation scheduled for September 2026, while the remaining 20 PV parks will follow. It is also estimated that all 24 PV parks will be in full commercial operation, as hybrid parks, within 2026 or at the latest in early 2027.
How is the Competitive Electricity Market going? What are the challenges, what are the problems and how can they be overcome?
The Competitive Electricity Market (CEM) will complete one year of operation in a few days. It is natural, and we expected, that there would be some problems in the first months, but not so extensive and that most of them would remain unresolved to this day. Of course, it is a positive fact that after years of delays, the CEM has operated in Cyprus, as in most European countries, following the relevant European Directive on the internal electricity market, as well as the fact that despite the problems, it continues to operate and develop. It is also important that the competent bodies understand both the problems and the impacts they have on the operation of the Market, as well as the urgent need to take corrective measures.
One of the serious problems in the operation of CEM is the incomplete management of metering data, which we receive with great delay and in many cases proves to be inaccurate, resulting in serious impacts on our customers' pricing and on the forecasts of production and consumption for the next day.
An equally serious and fundamental problem is the fact that EAC Generation continues to be the only producer with conventional generation units, which cover approximately 75% of total electricity production. EAC Generation is the only producer that can participate, through conventional units, in auctions and in individual market processes, in which such production capacity is required. As a result, it exerts a decisive influence on the formation of prices in critical market segments, due to the dominant position it still holds in conventional generation.
Furthermore, the development of the Cyprus electricity system has not kept pace with the rapid penetration of RES units, with the result that the weaknesses of a small and isolated system are now being highlighted. The owners of the transmission and distribution networks established by law (the EAC) are now being called upon to manage, within particularly tight time frames, structural weaknesses, such as the weak network and old conventional generation units. Necessarily, for security purposes, it operates by imposing the operation of both conventional mandatory integrated units and additional conventional units to satisfy the requirements of the IPP (integrated planning process), however, in this way it necessarily imposes huge cuts in the production of electricity from RES, which in many cases reach up to 90% of RES production on the market. A major reason why the final cost remains high is that we continue to rely on expensive conventional generation, at the same time that much cheaper electricity from RES cannot be utilised and is ultimately curtailed.
The challenge is great and has a name: we urgently need large Electricity Storage Facilities (ESF) with batteries that will be charged with cheap electricity during sunny periods and discharged at night, putting pressure on the high prices that prevail at night, when the market depends much more on the conventional production of EAC Generation. We also need the gradual replacement of old conventional units with modern, more efficient, cleaner and more flexible units.
There are, of course, a number of other, equally serious problems in the operation of the CEM, such as the reduction in liquidity in the day-ahead market, the obligation to implement dynamic pricing and the deprivation of the right of participants to manage their own purchase program. We have informed the relevant bodies in this regard, looking forward to finding appropriate solutions that will contribute to the smoother and more efficient operation of the market.
Reducing the price of electricity with a truly competitive electricity market – CEM operates without substantial competition
In what ways do you think businesses and households can be relieved from the increased cost of electricity?
What will bring relief to everyone, businesses and households, is the reduction of the price of electricity as soon as possible and this can only be achieved through a truly Competitive Electricity Market. It will take time, but relief can also come as a result of the implementation of immediate and short-term corrective measures. Today, the CEM unfortunately operates without substantial competition, since most of the time the need for electricity is met exclusively by a single conventional producer.
The installation of a significant capacity of ESF installations in the Cyprus electricity system will allow for much better utilisation of the electricity generated by RES. This energy will be stored during the hours of sunshine and released into the system when it is really needed, especially during the evening hours. In this way, cuts will be reduced, the need for more expensive conventional generation will be limited and, ultimately, the conditions will be created for lower electricity costs for businesses and households. This is something that has been understood by the Government, which has announced that it will soon announce support plans for the installation of batteries in businesses. We welcome this initiative because it is an important step in the right direction and we recommend the creation of a corresponding plan for household consumers as well.
This is how Bioland Energy will dynamically enter the household consumer market
What are Bioland Energy Ltd's expectations and plans/priorities for the second half of 2026? Where do you see growth opportunities, but also what challenges are considered to determine the course of the market by the end of the year?
Our priority at the moment is to reduce energy costs, which will allow us to offer even more competitive prices to our customers, as well as more competitive tariffs to residential consumers. Our company's plans/priorities for the integration of ESF (battery) installations in 24 existing PV parks, with a total installed capacity of 34 MW and a capacity of 101 MWh, within 2026, are also aimed at this direction. For 2027, we have already planned this capacity of ESF installations to increase to approximately 150 MWh. At the same time, the construction of new PV parks with flexible connections that will have integrated batteries is planned, which will be able to better meet the needs of the system and enhance the effective participation of RES in the Competitive Electricity Market. In the future, our company is also planning the installation of large central energy storage systems to support the grid.
You understand that batteries will allow us to utilise the energy produced by photovoltaic systems during the evening hours, which is currently limited or discarded. In this way, our overall energy costs will be significantly reduced, our dependence on the dominant conventional producer will be limited and we will be able to pass on a significant part of this benefit to our customers. At this point, we should clarify that our goal is to extend our services to residential consumers. Today, the high cost of energy supply during the evening hours does not yet allow us to set the competitive tariffs we would like for this specific category of consumers. However, we estimate that with the development of storage, this will soon be able to change and allow us to dynamically enter the residential consumer market.
How are the processes for energy storage systems and agro-photovoltaic systems progressing and what benefits are expected to arise?
The procedures for the first 24 photovoltaic parks that will integrate ESF installations (batteries) are at a very advanced stage. The first four PV parks have already secured the final connection terms and their technical inspection and trial operation are scheduled for September 2026. The remaining 20 PV parks will follow. We estimate that all 24 PV parks will be in full commercial operation, as hybrid parks, within this year or at the latest in early 2027.
Regarding agro-photovoltaic systems, there has unfortunately been a recent setback with the amendment of the relevant Law, according to which the development of agro-photovoltaic systems in Cyprus is now completely prohibited. We hope that efforts will be made to differentiate this specific amendment to the Law so that the development of agro-photovoltaic systems is permitted, under conditions.
This would really be a positive development because agro-photovoltaic systems are allowed and promoted in many European countries, as they can offer significant advantages. First and foremost because they offer these advantages to the farmers themselves, who will be able to exploit their fields doubly, on the one hand with the production of electricity and on the other hand with the possibility offered to them to continue cultivating their fields as before.
Under the appropriate conditions and depending on the crop and system design, they can also contribute to reducing irrigation needs by limiting evaporation and offer additional protection to crops, by placing panels, from extreme weather events and high temperatures.
Our company has already constructed a small number of agro-photovoltaic systems, the commercial operation of which will begin very soon and we are absolutely certain that it will confirm in practice the significant advantages they offer both in the production of clean energy and in agricultural activity.
(Source: InBusinessNews)
