An ongoing investigation by the Audit Office is underway following an official complaint by the Electricity Authority of Cyprus (EAC) regarding alleged legal violations by P.E.C. POWERENERGY CYPRUS LTD.
The company is constructing its own power station, generating 230 megawatts, in Vasiliko, very close to EAC’s installations.
The Audit Office has dispatched a comprehensive letter to the Ministries of Energy and Defence, the Cyprus Energy Regulatory Authority (CERA), the Department of Town Planning, the Land Registry Department, the Department of Environment, and other relevant departments, seeking their positions on the matter.
According to the Audit Office’s letter, EAC claims to have “found that P.E.C. POWERENERGY CYPRUS LTD has taken actions or constructions near the Vasiliko power station that pose serious risks to its operation and the overall ecosystem of the region.”
The Audit Office points out to the relevant authorities, from whom they have requested positions, that “we note that, at this stage, we have not investigated these claims to confirm them.”
In response, the private company stated to Phileleftheros that all work is carried out legally, following the receipt of all permits. They attributed EAC’s claims to an attempt to delay the construction of the private power station and simultaneously hinder competition.
In summary, EAC claims the following:
(a) P.E.C. has constructed a seawater pumping station on the beach, southwest of the Vasiliko station, on plot No. 558, leased exclusively to EAC for the purposes of the Vasiliko Power Station. According to EAC, this construction constitutes an illegal intervention on the plot. EAC demands the removal of the pumping station; otherwise, legal action will be taken.
(b) The required town planning permit for the construction of the aforementioned pumping station, the installation of the seawater inlet pipe, and the outlet pipe for warm cooling/desalination water, does not seem to have been obtained.
(c) A town planning permit for the installation of a land pipeline for seawater supply has not been secured. This pipeline passes through the land of the Naval Base and ends at the pumping station.
(d) The company appears to be violating the agreement it made with the Department of Town Planning to apply for a town planning permit for the installation of pipelines and the pumping station.
EAC informed the Audit Office of its serious concerns about the risk of affecting the performance of all units of the Vasiliko Power Station.
This is due to a possible increase in the temperature of the seawater extracted by EAC, as the pipe placed by P.E.C. to return used cooling/desalination water is in close proximity to EAC’s water intake point.
EAC uses seawater for cooling its plant machinery, and any increase in the intake water temperature will cause severe financial losses to EAC and, consequently, to Cypriot consumers.
From P.E.C.’s perspective, they stated that EAC’s claims regarding an increase in seawater temperature from the water returned by their station are baseless and constitute fear-mongering. According to them, only a small amount of water will be returned to the sea, as the company will use a different, more modern cooling process for its units.
A spokesperson for P.E.C. commented that all necessary permits for the new power station, currently in an advanced stage of development, have been secured.
The spokesperson dismissed EAC’s claims, asserting that the construction, once completed and with the introduction of natural gas, will provide competitively priced electricity.
The Ministry of Defence has become entangled in the issue, with the Audit Service indicating that a meeting took place on October 6, 2023.
The meeting involved representatives from various government departments, including the Ministry of Defence, the Department of the Environment, the Provincial Office of the Department of Land Registry, the Cyprus Ports Authority, the Energy Service, the Department of Fisheries, EAC, as well as officers from the Navy Administration and the Naval Base.
According to EAC, during the meeting, concerns were expressed by the Department of the Environment regarding ongoing projects both in the maritime area and along the coastline.
The concerns raised included a pile-up of omissions, unauthorized works, and non-compliance with Environmental Impact Assessment conditions.
EAC further claims that the Head of Technical Services of the Ministry of Defence mentioned facilitation and approval for the construction of a pumping station, but EAC disputes the legality of such actions, asserting its ownership of the relevant land.
The Audit Service has called on the involved entities to provide prompt clarification:
The Ministry of Defence and the Navy Administration are urged to confirm if they granted any facilitations or approvals for the construction of the pumping station and the installation of a terrestrial pipeline for seawater intake/discharge. They are also asked to clarify the legal basis for such actions and whether compensatory measures have been or will be taken.
The Town Planning Department is requested to inform whether any terms of the Town Planning Permit issued to the company for the construction of the power plant and the related agreement have been violated. Additionally, details about actions taken or planned in case of non-compliance are sought.
The Department of the Environment is asked to provide information on the Environmental Impact Assessment conditions, which terms may not be applied or violated, and the actions it intends to take if the company fails to comply.
The Land Registry Department is called upon to confirm if the area where, according to EAC, illegal works are being conducted is leased to EAC, and if any agreement exists with the company for the use of alternative space in Vasiliko.
The Energy Service is requested to disclose whether it has received any information from the company regarding the mentioned works and what actions it has taken or plans to take.
The Cyprus Ports Authority is urged to clarify whether the company was required to seek approval for executing works in the maritime area. If not, the Authority is asked to outline its intended course of action.
The Regulatory Authority for Energy of Cyprus is called upon to provide details about the licenses granted to the company, the terms included in these licenses, any non-compliance by the company, and the actions taken in case of violations.
