Minister of Energy, Commerce and Industry, Michael Damianos, has highlighted the need to strengthen the Republic’s energy security in light of dramatic geopolitical developments in the Middle East, which have triggered the largest disruption in the history of the oil market.
Cyprus is entering a phase of comprehensive energy realignment, with the government prioritising the rapid reduction of dependence on imported fossil fuels as the only “realistic option” for ensuring the country’s economic stability, Damianos said addressing the 16th Nicosia Economic Congress.
Damianos noted that the conflict involving Iran and disruptions in the Strait of Hormuz — through which 20% of global oil and LNG trade passes — highlight the vulnerability of the global energy system, putting pressure on citizens’ purchasing power.
“Energy security cannot depend on uncertain international conditions,” he stressed, describing the strengthening of energy independence as “an urgent national necessity.”
According to the Minister, the government’s strategy focuses on reducing costs through three key pillars. The completion of LNG import infrastructure, he said, is expected to reduce emissions by 25% to 30%, thereby lowering the cost of emission allowances that currently burden electricity bills.
He added that the installation of energy storage systems under the management of the Transmission System Operator is also being promoted, in order to ensure grid stability and facilitate the greater penetration of renewable energy sources.
Regarding projects such as the Great Sea Interconnector, the Minister said the government maintains a “responsible and rational” stance, prioritising the safeguarding of economic and technical parameters.
Damianos also announced that the “Save – Upgrade Homes” grant scheme will be relaunched in 2026. For the first time, a grant scheme will also be introduced to support energy storage installations in businesses.
At the same time, he referred to the creation of a Smart Grid, including the installation of smart meters, as well as the state’s obligation to reduce energy consumption by 1.9% annually from 2027.
To provide immediate relief to citizens, the Minister recalled recent government decisions to reduce excise duty on motor fuels by 8.33 cents and lower VAT on electricity from 9% to 5%.
Concluding, Damianos called on the business community to make use of the new investment tools and the upgraded One-Stop-Shop, stressing that “the cost of inaction is far greater than the cost of transition.”
CNA/NB/EPH/2026
ENDS, CYPRUS NEWS AGENCY
