Policies in Cyprus

Overview of Grid-E

Cyprus's electrical grid is governed by national laws, EU directives, and regulatory frameworks that control electricity production, transmission, distribution, and supply. A list of the main laws and regulations is provided below. Mainly, there are 3 regulations that govern the grid policies, and the rest of the regulations are subject to them.

Enacted to align the national electricity market with the European Union's Directive (EU) 2019/944, the Law Regulating the Electricity Market of 2021 (Law 130(I)/2021) is a crucial piece of legislation in Cyprus. The goal of this alignment is to promote an electricity market in the EU that is competitive, customer-focused, and free from discrimination. Mainly, the Law promotes Market Liberalization, to promote a more open and competitive electricity market in Cyprus, defines the functions of suppliers, CERA (Regulatory Authority), DSO (Distribution System Operator), and TSO (Transmission System Operator) and oversees the licensing process, tariffs methodologies and the rights and obligations of participants in the Electricity Grid.

The Transmission and Distribution Rules are integral to the efficient and reliable operation of Cyprus's electricity infrastructure.

Transmission System Rules: Prepared by the Cyprus Transmission System Operator (TSOC), these rules cover all technical aspects related to the connection and operation of the Transmission System. They are published in accordance with Article 85 of the Electricity Market Regulation Laws of 2021 – 2023. The latest approved version is available on the TSOC's official website.

Distribution System Rules: Developed by the Distribution System Operator (DSO), these rules address technical aspects concerning the connection and operation of the Distribution System. They are published as per Article 89 of the same laws. The most recent version, approved by CERA, is accessible through the Electricity Authority of Cyprus (EAC).

These regulations are intended to guarantee the economic, well-coordinated, and effective operation of Cyprus's distribution and transmission networks. They establish the technical specifications for organisations looking to connect to or utilise these systems, encouraging economy, dependability, and efficiency in their development and use.

Other policies affecting the electricity Grid are,

• Licensing regulation by CERA
  • Law for the promotion and encouragement of the use of renewable energy sources (107(I)/2022)
  • Technical guide for connecting to the Grid
  • Support schemes for the RES system
  • Cyprus Integrated National Energy & Climate Plan

Cyprus Sustainable Energy Action Plan

Grid ownership

According to the Electricity Market Regulation Law of 2021 (Law 130(I)/2021), the TSO of Cyprus is the transmission system operator, while EAC is the owner of the Cyprus transmission system. The Distribution System, unlike the Transmission System, is operated and managed by its Owner, which is the Electricity Authority of Cyprus.

Island interconnection

Cyprus has a single Grid and is High, Medium and Low voltage.

Island-relevant TSOs and DSOs

According to 130(I)/2021, 122(I)/2003, and CERA (Cyprus Energy Regulatory Authority), Cyprus's TSO is the transmission System Operator (C-TSO), and the DSO is responsible for Cyprus's Distribution System.

Development of electricity grids for RES integration

The regulations responsible for RES integration in the electricity grid are the regulation for the Electricity market L.130(I)/2021, integrating the Directive 2018/2001 regarding developing the RES project into the Grid. The Regulatory Administrative Acts RΑΑ 523/2021 regarding licensing RES projects, the regulation L.107(I)/2022 regarding the promotion of the use of RES use, section T.1.7.3 which talks about Producers from Transmition regulations whom responsible is Cyprus's TSO and section D.1 from the Distribution regulation that talks about the Terms of connection to the Distribution System. 
The 2024-2033 Ten-Year Transmission System Development Program (TSDP) approved by CERA is published to ensure transparency and information for all interested parties, as provided by the Electricity Market Regulation Law of 2021 (L.130(I)/2021).

Specifications for islands, isolated grids, microgrids, local grids, etc.

There are specified points related to the market and trading since Cyprus is not connected to any other EU member transmission system via interconnections.
Currently, there is a Decision on Cross-Border Cost Sharing (decision 136/2021 and 216/2017 from CERA) of a Project of Common Interest No 3.10.2 Interconnection Between Kofinou (CY) and Korakia, Crete (EL) and No 3.10.3 Internal Line Between Korakia, Crete and Attica Region (EL).

The Council of the European Union has approved the allocation of a €100m support fund to the EuroAsia Interconnector electricity interconnection as part of the Recovery and Resilience Plan for Cyprus to end the energy isolation, which is the last non-interconnected EU member state, and for the development of a sustainable and green economy.

Exceptions for islands

Following EU Regulation 2019/943 that focuses on setting an objective for EU members to develop their Climate and energy framework for 2030 by enabling the increase of efficiency, higher share of RES, security of supply, decarbonization, promoting the development of fundamental principles for well-functioning, integrated electricity market, non-discriminatory electricity market etc, Cyprus as a member state with an island grid has some exception until the transmission system is connected to other member states system. Some of the exceptions are. 
-    Principles regarding the Electricity market (article 3)
-    Responsibilities regarding imbalances in the system (article 5)
-    Prequalification on the market process (article 6)
- Organisation of the market from CTSO, equal opportunities for market participants and no distinction on trades (article 7)
-    ETC
The exception can be found in Articles 3, 5 and 6, Article 7(1), points (c) and (g) of Article 7(2)) Articles 8 to 17, Article 18(5) and (6), Articles 19 and 20, Article 21(1), (2) and (4) to (8), point (c) of Article 22(1), points (b) and (c) of Article 22(2), the last subparagraph of Article 22 (2), Articles 23 to 27, Article 34(1), (2) and (3), Articles 35 to 47, Article 48(2) and Articles 49 and 51 of the Directive.

An important part of the regulation is that, if Cyprus is not connected to a member state’s Transmission System by 1/1/2026, then Cyprus will be able to prolong the derogation to the Commission. The Commission will then decide if the derogation is causing any issues to the electricity market of Cyprus, just like the Decision of the Commission EU 2022/258 and the Swedish TSO a derogation from the 70% requirement.[2][3]

The main piece of legislation controlling Cyprus's electricity market, transmission, and distribution is Law 130(I)/2021, which complies with EU standards to establish a market that is sustainable, competitive, and open. Fostering a liberalized energy sector, encouraging the integration of renewable energy sources, guaranteeing non-discriminatory grid access, establishing explicit guidelines for market operation, and protecting consumer rights through reasonable pricing and high-quality services are some of its primary goals. 

The Cyprus Energy Regulatory Authority, an independent market regulator that supervises tariffs, compliance, and market operations, is one of the important organizations whose functions are delineated by the law. While the Distribution System Operator maintains the lower-voltage network and makes it easier for producers and consumers to have equitable access, the Transmission System Operator oversees the high-voltage grid, guaranteeing stability and integrating RES.

While producers create electricity from both conventional and renewable sources and compete in the wholesale market, electricity suppliers also follow consumer protection policies and market regulations in their efforts to serve consumers. The law also acknowledges energy communities that facilitate the production of renewable energy collectively and prosumers who produce electricity for their own use. 

The law's market liberalization creates a competitive framework in which producers sell electricity to suppliers in a wholesale market and consumers have a choice of suppliers in the retail market. It gives integration of renewable energy top priority and guarantees fair competition. Tariff regulation, overseen by CERA, guarantees fair pricing based on cost-reflective principles, while special tariffs exist for vulnerable consumers. Consumer rights include access to transparent pricing, the ability to switch suppliers, and protection against unfair billing practices. 

A key component of the legal framework is grid development and modernization, which requires the TSO and DSO to upgrade and expand infrastructure in order to handle the increasing penetration of RES. Digitalisation and smart grid technologies increase efficiency even more, guaranteeing a smooth transition to a more environmentally friendly energy system. 

Grid codes, performance data reporting, grid stability support, environmental regulations, and fair market practices are all requirements for plant operators, including electricity producers and RES facilities. Although they are required to pay network fees and adhere to efficiency regulations, consumers and prosumers have the right to fair electricity pricing and supplier choice. 

Through the introduction of streamlined grid connection procedures for small-scale installations, required environmental impact assessments for larger projects, and exemptions for rooftop solar PV under certain capacities, the law expedites the authorization process for RES projects. To guarantee regulatory compliance, CERA oversees the approval of new RES installations.

The principles and operational procedures that govern the relationship between all Transmission System Users and the Cyprus Transmission System Operator (TSO) are outlined in the Transmission Rules. Generators, Storage Facility Operators, Storage Representatives, Aggregators of High-Efficiency Cogeneration (CHP) and Renewable Energy Sources (RES), Suppliers, Distribution System Operators, Transmission System Owners, Transmission System Consumers, and Demand Response Representatives are some of these users. The Transmission Rules give Cyprus' electrical system a well-defined framework for operation, guaranteeing short-, medium-, and long-term control and regulation in an environment of security, dependability, and low cost. Both routine and emergency situations are covered in their daily procedures for system planning and operation. 

Within Cyprus' liberalized electricity market, the Rules allow electricity system operators to keep a real-time balance between production and demand. The Transmission Rules are intended to facilitate the operation of the Electricity Market and assist in the creation, upkeep, and operation of an effective, coordinated, and economical Transmission System. They act as a thorough manual that outlines best practices for system design, operation, and usage for all Users and the Cyprus Transmission System Operator, especially from a technical standpoint.

Key Components of the Transmission Rules:

1. Connection Terms to the Transmission System (T1): These define the minimum technical, design, and operational criteria that both the Transmission System Operator and Users must meet at connection points.
2. Planning Rules (T2): These require Users to provide specific data to the TSO, enabling the strategic planning and development of the Transmission System.
3. Operational Rules: Operation-related rules include forecasting demand and renewable energy injection, coordinating the planning of transmission system and user system outages for construction, repairs, and maintenance, discussing different methods of lowering demand, reporting planned operations and unforeseen events like faults, and outlining procedures for written reporting in the event of a fault and for the Transmission System Operator to conduct investigations.
4. Security Coordination Rules: These outline detailed safety coordination procedures for entities performing work on the Transmission System.
5. Measurement Specifications and Procedures: These rules define metering procedures for market settlement purposes in accordance with the Electricity Market Rules.
6. Notification Requirements (T8.3): Users must inform the TSO of any changes to the operational characteristics of Dispatchable Generation Units and other Market Participants to ensure compliance with the Balancing Market obligations.

Instructions and Communication Procedures: These regulations define the format and content of commands issued by the TSO within the Balancing Market and establish communication protocols between the TSO and System Users regarding these commands.

The Distribution Rules were developed in accordance with the provisions of the Electricity Market Regulation Law and define the technical aspects of the working relationships between the Distribution System Operator (DSO), the Distribution System Owner, the Transmission System Operator (TSO), the Transmission System Owner, the Market Operator, and all Distribution System Users. These rules ensure a safe, efficient, coordinated, and cost-effective system for electricity distribution.

Users connected to the Distribution System must comply with the relevant parts of both the Distribution and Transmission Rules where applicable. Additionally, they must adhere to the provisions of the law and any other relevant legislation that comes into force. Consumers, Distributed Generators, and Storage Facility Operators must have Connection Agreements with the DSO, while Load Representatives and Independent Aggregators must establish System Use Agreements.

The Distribution Rules include references to various technical documents and the Transmission Rules. Users are required to comply with these documents as necessary. The Distribution Rules are structured as follows:

Key Components of the Distribution Rules:

1. General Provisions (D0): Define the legal framework governing the operation of the Distribution Rules.
2. Connection Terms (D1): Detail the technical and other requirements for those seeking to connect to the Distribution System, including specific conditions for Distributed Generators and Storage Facility Operators.
3. Planning Rules (D2): Provide specifications for electricity supply, as well as the design principles upon which the Distribution System is built. They also enable Users to obtain relevant information from the DSO for specific circumstances.
4. Operational Rules (D3): Address various operational issues affecting Users, including demand forecasting, Distribution System operation planning, demand regulation in emergency situations, system testing, monitoring, and emergency response procedures.
5. Safety Rules (D4): When working on the Distribution System or User Systems, the DSO and Users should establish standard operating procedures for organizing, putting into practice, and maintaining the required preventive safety measures. These precautions also cover high-voltage equipment to guarantee work is done safely.
6. Technical Provisions for Renewable Energy Systems, Storage Facilities, and Charging Infrastructure (D5): Summarize all technical and operational requirements for connecting these Users to the Distribution System.
7. Information and Data Exchange (D6): Define the requirements for incident and operation reporting, functional communication between Users and the DSO, and data logging related to User installations.

The Distribution System Operator and the Distribution System Owner retain the right to propose additions and modifications to the Distribution Rules at any time through appropriate mechanisms.

Rules concerning the connection of a new producer, RES, and storage to the grid

As mentioned in the current Transmission Rules and according to the regulations and the parties involved in the electricity grid, the Connection request is submitted either to the distribution system operator (DSO- Electricity Authority of Cyprus-EAC) or the TSO Cyprus. EAC is responsible for RES plants ≤ 8 MW, while the TSO Cyprus is responsible for RES plants >8 MW

According to CERA, the Electricity Market Principles the regulation L. 107(I)/2022(ARTICLE 18, the regulation regarding Electricity market (article 34 and 35 and regulation N.130(I)/2021 (CHAPTER 1 ARTICLE 25).

A prerequisite for participating in the Electricity Market is the possession of a permit in accordance with articles 34 and 35 of the Electricity Market Regulations and the associated licensing Regulations.
Currently, the only parties that participating in the Electricity Market are:
1.    Producers with Thermal Units
2.    Producers with RES stations
3.    Retailers
According to the Regulatory Decision "The Detailed Planning of Diversification of the Framework for Regulating the Operation of the Electricity Market of Cyprus", Cyprus can have more participants in the Electricity market.

For RES projects used for self-consumption can be planned under the net-metering/ net-billing scheme, and the grid connection process is less complicated. The end-users submit their applications with the mandatory documents to the EAC. The application is assessed and authorised, and then the agreement is signed. The final check of the RES is carried out by EAC, and if approved, the system is ready for use.

Depending on the RES plant capacity, the grid connection application is submitted either to the distribution system operator (DSO- Electricity Authority of Cyprus-EAC) or the TSO Cyprus. EAC is responsible for RES plants ≤ 8 MW, while the TSO Cyprus is responsible for RES plants >8 MW. A technical study is attached to the application that proves that all related technical requirements have been met (T 16.8.3 of the Transmission Regulation). After the grid operator has received and examined the application, it shall send a connection offer to the plant developer within 90 working days (sec. T 2.4.5.1, T 2.4.6, D 1.4.1 from Transition and Distribution Regulations accordingly). The project developer must accept the terms for connection within the period specified in the connection offer.. 

Under the net-metering/ net-billing scheme, the grid connection process is less complicated. The end-users submit their applications with the necessary documents to the EAC and pay an administrative fee of EUR 332,35 plus VAT for the Net Metering application, whereas, for the Net Billing application, the price varies according to geographic limitations. The application is examined, and if it is approved, a net-metering agreement is signed. The RES installation is complete, and a final check is carried out by EAC (Chapter 12 EAC Net-metering Technical Guide).

Specifications for islands, isolated grids, microgrids, local grids, etc.

The authorisation process is simplified for RES projects with a capacity of less than 5 MW and autonomous producers that produce electricity for their own consumption with a capacity of less than 1 MW. Also, PV systems and ground-mounted PV installed in industrial zones or with a maximum installed capacity of 150 kW are exempt from planning permission. Additionally, the grid connection process is simplified for RES installations that use net metering/net-billing schemes.

Possibilities to differentiate RES in scale and technology

According to the EAC website (under Regulated Activities > Renewable Energy), RES systems can be divided into the following categories.
•    RES systems for own consumption
o    Net Billing (Larger PV, biomass and biogas plants of up to 10 MW are supported through the net-billing scheme for natural and legal persons.
o    Net Metering (Subsidies for the purchase and installation of rooftop PV in the domestic sector or
rooftop and ground-installed PV for domestic and private sector (up to 10kW) that will operate under a net-metering scheme for 15 years.
o    Net Metering in Public School Buildings (Net metering for 12 years for public schools with PV rooftop installations of up to 20 kW
o    Virtual Net Metering/Net Billing
o    Charging of Electric Cars
•    RES systems in the context of the Transitional Regulation of the Electricity Market
•    RES systems with the Final End the Competitive Electricity Market
•    RES systems outside the Support Regime Plan

According to the current Transmission and Distribution Rules, Producers with a requested connection power greater than 8 MW or Customers (Consumers) with a requested connection power greater than 12 MVA, who are interested in connecting to the Transmission/Distribution System, need to submit a Connection Application to the System Operator Cyprus Transport (CTSO).

Also, Producers with a requested connection power of up to 8 MW or Customers (Consumers) with a requested connection power of up to 12 MVA, who are interested in connecting to the Transmission/Distribution System, need to submit a Connection Application to the System Operator Distribution (EAC).

Also, according to L.130(I)2021, CERA can grant general permission and an exception from the obligation to hold a license for the following,
•    Electricity production from power stations that are not connected to the system transmission or distribution system.
•    electricity production facilities with a maximum power of up to 20 kW
•    electricity production for self-use up to 30kW
•    Electricity Production from RES up to 50kW
 

Rights and obligations of consumers and prosumers

The licensing of actions related to electricity is regulated by the Law on the Regulation of the Electricity Market, the Regulations on the Regulation of the Electricity Market (Licensing) and the Regulatory Decision 02/2021 entitled “Regulatory Framework for the Granting of the General License (Regulatory Administrative Act No 523/2021).

According to Article 26 of the Law on the Regulation of the Electricity Market, it is forbidden for any person to carry out the following activities without obtaining a license from CERA: 

• construction of a power plant or electricity generation
• supply of electricity to final customers
• supply of electricity to wholesale customers
• discharging any of the functions of the Transmission System Operator of Cyprus in accordance with the provisions of Article 60
• carrying out any of the functions of the Distribution System Operator in accordance with the provisions of Article 47 or of the Closed Distribution System Operator in accordance with the provisions of Article 56
• carrying out any of the functions of the Transmission System Owner in accordance with the provisions of Article 36
• carrying out any of the functions of the Distribution System Owner in accordance with the provisions of Articles 41 and 42
• performing any of the duties of the Market Operator
• performing any of the duties of the Balance Responsible Party
• performing any of the functions of the Aggregator or the Independent Aggregator
• performing any of the duties of the Electricity Interconnector Owner
• performing any of the duties of the Electricity Interconnector Operator
• installing and/or operating an electricity storage facility, with the exception of electricity storage facilities operated exclusively for own use
• constructing a direct line in accordance with the provisions of Article 100.
• According to Article 116 of the Law, customers have the right to right to buy electricity from a supplier of their choice and the right to enter more than one electricity supply contract at the same time, provided that the required connection and metering points have been determined

The obligations for Customers and Prosumers stated in the Law are:

• Payment of Electricity Bills: Customers and prosumers are generally required to pay their electricity bills.
• Compliance with Technical and Safety Requirements: Customers and prosumers must adhere to technical and safety requirements
• Metering and Reporting: Customers and prosumers are typically responsible for allowing access to their premises for meter readings.
• Compliance with Grid Connection Rules: Customers and prosumers must comply with the rules and procedures for connecting their installations to the grid
• Contractual Obligations: Customers and prosumers are bound by the terms and conditions of their electricity supply contracts
• Compliance with Energy Efficiency Measures

According to subsection (4) of Article 27, CERA may grant an exemption from the obligation to hold a license for the following activities:

• Generation of electricity for own use from systems with a capacity of more than 30kW up to 1MW
• Generation of electricity from renewable energy power plants with a capacity of more than 50kW up to 8MW.

Rights and obligations of plant operators

According to subsection (1) of Article 27, CERA grants a general license in respect of the following activities: 

• Generation of electricity from power plants that are not connected to the transmission or distribution system
• Generation of electricity from power plants with a maximum capacity of up to 20kW
• Generation of electricity for own use from systems with a capacity of up to 30kW
• Generation of electricity from renewable energy power plants with a capacity of up to 50kW
• Generation of electricity from small-scale high-efficiency cogeneration plants in accordance with the provisions of the Laws on the Promotion of Energy Efficiency in Heating and Cooling and Heat and Power Cogeneration; and
• any other activity that at the discretion of the Minister or CERA, after consultation between them, it is appropriate to establish such procedures.

The obligations of a Plant operator and for RES Plant operator are as such:

• Compliance with the Licensing regulation: obtain necessary licensing and comply with the terms and conditions
• Grid connection and Operating compliance: Follow the Technical requirements from the Transmission and Distribution rules and ensure  grid stability and security requirements, including voltage and frequency control
• Allow grid operators (Transmission System Operator - TSO and Distribution System Operator - DSO) to monitor and inspect plant operations
• Meet grid integration standards for renewable energy, including participation in balancing markets where applicable and allow TSO and DSO to monitor and inspect the plant operation
• Follow environmental regulations concerning emissions, waste management, and sustainability standards.
• Implement health and safety measures for plant operation and personnel safety.
• Report any incidents or malfunctions that may affect system stability or environmental standards.
• Pay all applicable fees and charges, including network tariffs and market participation costs.
• Compliance with the Electricity Market rules

According to Regulatory Decision 01/2023 entitled “Regulatory Framework for Granting a General License (Amendment)”, Regulatory Administrative Act No 22/2023, the production of electricity from photovoltaic systems on the shell of an existing building with a capacity of above 50kW, was included in the categories for which a General License is granted.

Priority for RES and curtailment

In Cyprus, renewable energy sources are given priority according to the Regulation of the Electricity Market (130(I)/2021). The TSO and the DSO, when allocating load to the designated facilities, shall give priority to power generation facilities, to the extent permitted by the secure operation of the national electricity system, provided that the power generation facilities use renewable energy sources or high-efficiency cogeneration. Nevertheless, for reasons of grid safety and reliability, the grid operator may unlimitedly reduce RES imports at any time.

Law 130(I)/2021 and the Transmission and Distribution Rules, which provide a thorough framework for grid planning, operation, and expansion, regulate the growth of Cyprus' electrical grid. 

High, medium, and low-voltage networks are primarily managed and expanded by the Cyprus Transmission System Operator (TSO) and Distribution System Operator (DSO), while grid development plans, investment approvals, and tariff structures are supervised by the Cyprus Energy Regulatory Authority (CERA) to guarantee adherence to national and EU regulations. 

The TSO and DSO must create and revise a grid development plan to handle the increasing demand for electricity, improve supply security, and incorporate renewable energy sources (RES). Smart grid technologies and digitisation are becoming increasingly important to improve system efficiency. The Grid Code and Distribution Code specify technical requirements, such as voltage levels, frequency stability, and connection standards. 

With infrastructure advancements targeted at supporting renewable energy generation while preserving grid stability, the integration of RES is a top priority. Priority access is given to RES producers, and the TSO is required to evaluate the risks of congestion and suggest policies to encourage greater integration of renewable energy. 

The TSO submits a ten-year network development plan every year to outline planned upgrades, interconnections, and capacity expansions. The plan is subject to CERA’s review and approval based on economic, environmental, and security-of-supply considerations. Regulated network tariffs are used to recoup the costs of grid expansion. Before obtaining connection permits, new power plants, RES systems, and large consumers must comply with grid connection regulations. In certain situations, developers may also be required to pay for the required grid upgrades. 

Furthermore, decentralised energy production and consumption are made possible by the addition of provisions for Virtual Net Metering and Energy Communities in recent updates. The law requires stringent adherence to performance and stability standards in order to guarantee supply security and grid reliability. Grid operators must keep an eye on system conditions and put backup plans in place to avoid voltage instabilities, frequency deviations, and blackouts. 

Breaking these rules has consequences. Overall, the Transmission and Distribution Rules and the regulatory framework set forth by Law 130(I)/2021 guarantee that Cyprus' electrical grid is continuously modernized, expanded, and adjusted to accommodate the integration of renewable energy, new technological developments, and rising demand while preserving system stability, affordability, and efficiency.

Procedure 

Grid development is a part of the grid connection agreement. More specifically, grid connection agreement forms include all necessary expansion works to be carried out by the grid operator, if needed (section T1 from the Transmission Regulation). Plant operators bears all connection costs.

Tasks of the DSO/TSO

According to Directive 2009/72/EC, Directive 2009/73/EC, Directive 2009/119/EC, and 130(i)/2021 the task for DSO and TSO in Cyprus are,

• operation, maintenance and development of Cyprus’s network (DSO)
• Development of System distribution (DSO)

DSO - Distribution System Operator:

The DSO is responsible for the operation, maintenance, and development of the distribution system in a safe and efficient manner. The tasks and responsibilities of the DSO are as follows:

• Operate, maintain, and develop the distribution system in compliance with technical and safety standards
• Ensure the connection of all users to the distribution system
• Ensure non-discriminatory access to the distribution system for all users
• Develop and maintain an investment plan for the distribution system
• Provide accurate and transparent information to the NRA and the TSO on the operation and development of the distribution system
• Monitor and report on the quality of service provided to users

TSO - Transmission System Operator:

The TSO is responsible for the operation, maintenance, and development of the transmission system in a safe and efficient manner. The tasks and responsibilities of the TSO are as follows:

• Operate, maintain, and develop the transmission system in compliance with technical and safety standards
• Ensure non-discriminatory access to the transmission system for all users
• Ensure the security of the transmission system and its interconnections with other systems
• Ensure the adequacy and availability of the transmission system to meet demand
• Develop and maintain an investment plan for the transmission system
• Provide accurate and transparent information to the NRA and the DSO on the operation and development of the transmission system

Obligations and rights of plant operators

For EAC,

• performs maintenance and construction work in accordance with the ten-year transmission system development plan and the terms of the Transmission System Protocol, as well as design and development work as assigned to the Transmission System Owner by the Transmission System Protocol
• carry out any other work required under the ten-year transport system development plan and comply with any other requirement related thereto under this Law by showing the necessary care and attention to the protection of the environment
• informs the TSO and CERA, within the time period determined by CERA's decision, of the measures it intends to take for the implementation of the ten-year development program of the transmission system in accordance with the System Protocol Transportation
• ensures the long-term ability of the system to meet reasonable electricity distribution demand by commissioning
• avoids discrimination between users or categories of users of the system
• when allocating load to production facilities and demand response facilities, is obliged to give priority to production facilities that use renewable energy sources

Many of DSO’s obligations can be found in the L.130(I)/2021 article 35, 42 and 48

For TSO,

• obliged to construct and maintain an efficient, coordinated, safe, safe, reliable and economically viable distribution system, in accordance with the ten-year development program of the distribution system, showing due care for the care and protection of the environment.

Obligations and rights of Plant Operator and  RES plant operators in the development to the Grid

The obligation that Plant operators and RES plant operators have in order to be allowed to operate in Cyprus is to get a license for building and operating (electricity production license (Chapter I Article 25 from L.130(I)/2021). Some important criteria are,

• Compliance with the the Grid connection regulation and technical requirements
• Ensure the plant operation in order not to compromise the grid stability and safety
• Follow Trasnimtion and Distribution rules
• Grid reinforcement costs if their connection impacts the stability or capacity of the system
• Compliance with the Electricity Market rules
• Health and safety hazards
• The Protection of the Environment
• Use of land and installation
• Reduction of CO2 emissions throughout the RES generation
• Follow the regulations regarding of Urban planning

The rights that Plant operators and RES plant operators have that operate in Cyprus,

• All plant operators, including RES, have the right to connect to the electricity grid under fair and non-discriminatory conditions
• RES plants have priority access
• right to participate in the Electricity Market 

Role of the NRA
 CERA approves and revises the process and charging policy of the Transmission System as well as network usage fees. Also, CERA's responsibility is to approve, issue instructions and request a review whenever it deems necessary to the Transmission Rules. 

As mentioned on the N130(I)2021 (Article 24) the role of NRA (CERA), in Cyprus is to,

• Regulation and monitor the electricity market of Cyprus
• Licensing for electricity operation
• Tariff and Market Regulation and monitoring
• Consumer protection in the energy market
• promoting RES project
• Approve the methodologies used by DSO and TSO

• EAC - DSO: The DSO is responsible for the operation, maintenance, and development of the distribution system in a safe and efficient manner. 
• TSO Cyprus: The TSO is responsible for the operation, maintenance, and development of the transmission system in a safe and efficient manner. 
• CERA: CERA approves and revises the process and policies of the Transmission System and Distribution System as well as network usage fees. Also, CERA's responsibility is to approve, issue instructions and request a review whenever it deems necessary to the Transmission Rules and Distribution System. 
• Electricity Suppliers: Electricity suppliers are in charge of buying electricity and reselling it to customers while making sure that market rules are followed. They must follow the distribution rules and electricity market rules if they want to participate.
• Electricity Producers :  they must follow Grid Compliance & Power Generation and run power plants effectively while adhering to grid connection guidelines. Also, they need to make sure that they properly coordinating  of the dispatching of electricity. 

A single DSO is designated by Law 130(I)/2021 and other regulatory frameworks to guarantee non-discriminatory access to the electrical network. By doing this, disputes and inefficiencies that might result from several DSOs overseeing a comparatively small grid are avoided.

Cyprus has an islanded electrical system, which means it is not connected to any other nation's grid, in contrast to larger nations where several DSOs oversee regional grids. Grid stability, consistent planning, and effective infrastructure investments are all maintained by a single DSO.
Cyprus's size, remote grid, historical monopoly, and regulatory structure make having a single DSO there a sensible and effective decision. 

Smart meter penetration rate

According to the latest DSO report from Eurelectric [6] 2020 there is 0% penetration of Smart meter. Currently, there is the Empower project that aims to improve that.

The law that allows CERA to guarantee the employment of smart metering is the Regulation of the Electricity market. According to that, CERA instructed Cyprus DSO to initiate a large-scale roll-out of electricity smart meters from January 2019. The strategic plan is from 2019-2027 Cyprus will have a penetration of smart meters of 75%. According to the decision from CERA RAA 259/2018, has instructed in 2019 the procedures for planning a large-scale rollout with the goal of installing 400,000 smart meters for electricity during 2025-2026. There are plans for Climate neutrality, Energy Efficiency and Renewable Energy penetration in Cyprus’s PPR.

An analytic study for Smart Electricity meter market2024: Global Adoption landscape showed that for Cyprus the penetration rates may vary from 0%-10%.According to TSO and DSO, there are no updates for smart meter penetration. EAC issued a procurement regarding Advanced Metering Infrastructure Rollout in 2021, but there are no other updates.  

Policies for digitalisation of the electricity grid

According to the main regulation for the Electricity market, L.130(I)2021 article 70 gives full responsibility to Cyprus’ TSOC to promote and improve the digitalisation of the transmission system. Also, there is a 10-year program approved by CERA and TSOC for the development of the transition system of Cyprus.

Additionally, the KIOS research centre is accountable for the project, EMPOWER [7] project brings together all the key stakeholders of the electric energy sector (DSO, TSO, etc) in order to develop sustainable and intelligent technologies for the electric power system of Cyprus. One of the major objectives of EMPOWER is the smart and green evolution of the Cyprus power system infrastructure. The project aims to contribute to the strengthening of the Cyprus electricity system, using smart tools and systems without affecting the stability and reliability of the system.

Rules for islands, isolated grids, microgrids, local grids, etc.

Cyprus throughout the European Directives 2019/944 and 2009/72 asked its members to provide ‘’ consumers clear rights to request smart metering devices and dynamic pricing contracts’’ and manage to accomplish a penetration rate of 80% of smart metering, development of the regulation regarding Electricity Market L.130(I)/2021. This regulation gives CERA the responsibility to develop smart metering in the electricity market. Also, regarding the same regulation suggest new suppliers with large numbers of End users to enable them to choose to use a smart meter.

Total number of active electricity nationwide suppliers: According to CERA, currently 31 participants hold the right to be Electricity suppliers. Although, for households due to the complexity of electricity distribution EAC is the current supplier. Most of the other electricity suppliers, mostly due to their energy coming from RES systems (PV parks), prefer commercial and industrial consumers. The electricity supplied by the active suppliers uses the same distribution network in Cyprus. Currently is easier to take upon clients with STOD-type meters which is a programmable meter that records every half hour. Customers who do not have a STOD-type meter must obtain it by paying the DSO the installation cost, as determined by CERA 

CERA, with the Regulatory Decision no. 02/2015 Statement of Regulatory Practice and Methodology of Electricity Tariffs, RAA 208/2015 (Section 8 from the report), issued the Calculation Methodology of the tariffs related to the use of the Transmission and Distribution Network, the recovery of the expenses of the C-TSO and the provision of ancillary services and long-term reserve. By Decision No. 97/2017, CERA approved the amount of these tariffs, which are part of the final Supply Tariff, and approved their recovery through energy pricing. 

The tariff methodologies applied by CERA are important to regulate them and must follow certain objectives,

• reflect the cost of service to increase economic efficiency 
• allow the reasonable possibility of recovering efficient costs 
• be fair and non-discriminatory unless justified by other tariff objectives, such as increasing economic efficiency
• avoid cross-subsidies between various activities in the electricity sector (i.e., generation, transmission system ownership, transmission system operation, distribution system ownership, distribution system operation, and supply); 
• be straightforward, transparent, and predictable
• encourage consumers to make efficient consumption decisions
• be consistent with the Republic of Cyprus's clear environmental objectives
• promote electricity supply security
• permit the recovery of efficiently incurred costs associated with public service obligations and the promotion of electricity generation from renewable energy sources and high-efficiency cogeneration
• offer incentives to regulated firms to operate efficiently
• facilitate the efficiency and quality of the services rendered by licensees.

Currently, there are 5 types of Tariffs,

• Commercial and Industrial Use
  • Code 10 - Bi-monthly Low Voltage Single Rate Commercial Use Tariff  
  • Code 20 - Bi-monthly Low Voltage Single Rate Industrial Use Tariff  
  • Code 30 - Monthly Low Voltage Seasonal Two-Rate Commercial and Industrial Use Tariff
  • Code 40 - Monthly Medium Voltage Seasonal Two-Rate Commercial and Industrial Use Tariff 
  • Code 50 - Monthly High Voltage Seasonal Two-Rate Commercial and Industrial Use Tariff
• Domestic Use
  • Code 01 - Single Rate Domestic Use Tariff 
  • Code 02 - Two Rate Domestic Use Tariff 
  • Code 08 - Domestic Use Special Tariff for Specific Categories of Vulnerable Customers
• Storage of Thermal Energy
• Water Pumpin 
• Public Lighting

Tariff methodology on islands, microgrids, local grids, etc.

The Wholesale Electricity Tariff is adjusted based on the Weighted Average Fuel Cost announced by EAC every month and the Approved Energy Charge Clause Factor for High Voltage consumers, approved by CERA every 6 months, which is adjusted by the high voltage loss coefficient of each month based on the relevant decision of CERA (no. 375/2021). The Average Weighted Fuel Cost of each month is presented on the EAC website at:

https://www.eac.com.cy/EL/RegulatedActivities/Supply/tariffs/Pages/Fuel-Cost.aspx 

The approved high voltage fuel clause factor and the high voltage monthly loss factor based on the relevant decision of CERA are shown in the table as shown on the website above. Specifically, the Adjusted D-X for a specific time is equal to the D-X at the Base Fuel Price (ie, with a fuel price of €300/MT), differentiated by the product of the difference between the Weighted Average and Base Fuel Cost times the Approved Clause Factor Fuel to High Voltage Network consumers applicable in the given month by the High Voltage loss factor (ie, by the Adjusted Fuel Clause Factor for High Voltage consumers).

Relevant policies 

•    Regulation on Electricity Market 130(i)/2021
•    Regulatory Decision No. 02/2015 (RAA 208/2015) "Statement of Regulatory Practice and Electricity Pricing Methodology".
•    THE LAWS ON REGULATING THE ELECTRICITY MARKET OF 2003 TO 2012, N. 122(I)/2003 TO N. 211(I)/2012 REGULATORY DECISION NO 02/2015
•    Calculation Methodology for the Adjustment of Fuel Basic Tariffs and Energy Purchase Price from RES-E
•    The Energy Efficiency in End-Use and Energy Services Laws of 2009 and 2012 and their amendments (Law 31(I)/2009, Law 53(I)/2012

Are there existing caps for RES installed capacity in the network?

Depending on how much the grid (on each substation) can handle the cap can be seen on the Hosting capacity Map. The RES capacity can vary from 2-10kW for Net Metering,10kW-8MW Net billing ETC.
RES-E Hosting Capacity is the maximum RES capacity that can be connected at the transmission substation level. The Hosting Capacity Map was developed by both Distribution System Operator (DSO) and Transmission System Operator of Cyprus (TSOC) as part of the Cyprus Transmission and Distribution System Redesign Study for 2021-2030, prepared as per the Cyprus Regulatory Authority Decision 02/2019 and RAA 204/2019.

The Hosting Capacity Map is essentially a tool, which geographically presents the RES-E Reception Capacity that can be connected per Transmission Substation. Also, the Available RES-E Capacity is presented, i.e. the remaining available capacity to integrate RES-E systems which is obtained by subtracting from the Reception Capacity of the already installed RES-E systems (the installed systems also include the systems that have already accepted the terms connection).

What are the curtailment rules for RES generation?

According to the Cyprus regulation, the TSO of Cyprus has the obligation when seems necessary in order to protect the grid, to restrict electricity generation from RES to ensure the orderly operation of the electrical system. The restriction of Electricity Production from RES is carried out using specialized tools and algorithms to ensure, to the maximum extent possible, the fair distribution of cuts to all RES units controlled by the Transmission System.

Who is responsible for voltage balancing, frequency reserve, unit dispatching, electrical system management?

Cyprus DSO

Who has access to metering data?

Cyprus DSO is eligible, to access the meters to collect appropriate data. According to the L.130(I)/2021 consumers must allow the DSO to collect data for their consumption.