Great Sea Interconnector

Greek-Cypriot-Israeli grid link progressing, delays inevitable

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A prospective electrical grid interconnection planned to link Greece, Cyprus and Israel is making progress but delays seem inevitable, it has been determined following talks in Cyprus between Greek and Cypriot officials.

Greek power grid operator IPTO’s chairman and CEO Manos Manousakis and his deputy Giannis Margaris have just held constructive talks with Cypriot officials on the project.

The IPTO officials informed officials of the Cypriot government and the country’s transmission system operator that they have already commissioned a new cost-benefit study, a prerequisite for the Cypriot government ahead of its decision on whether to participate in this project.

Also, IPTO has forwarded, to the Greek and Cypriot regulatory authorities, an agreement it has signed with Cypriot company Euroasia, the project’s previous promoter, to succeed it at the project’s helm, according to sources at the Greek power grid operator.

This action paves the way for IPTO to be officially declared project promoter of the grid interconnection. However, the Greek and Cypriot regulatory authorities still need to recognize this transfer of project control from Euroasia to IPTO.

Meanwhile, IPTO has already formed a special purpose vehicle (SPV) named Great Sea Interconnector as a subsidiary to be assigned rights and responsibilities concerning the project’s development.

IPTO has repeatedly made note of the need for swifter action, both by the Cypriot government in its decision on whether to participate in the project, and by the regulators for their recognition of the project’s transfer of control. The European Commission has also demanded swifter progress from all parties involved – regulators, operators and governments.

Crucially, Israel has warmed to the prospect of co-developing the project’s second segment that would link the Cypriot and Israeli electrical grids and complete the interconnection, maximizing the benefits to be derived from it.

Great Sea Interconnector drawing US, UAE fund interest

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Latest developments concerning the prospective Great Sea Interconnector, a 1.9 billion-euro project planned to link the power grids of Greece, Cyprus and Israel, indicate that investment interest is growing.

Officials of Greek power grid operator IPTO, promoting the project through an SPV, are expected to hold talks in Nicosia today with representatives of Abu Dhabi-based fund TAQA, one of the key players examining the prospect of becoming a stakeholder in the Great Sea Interconnector.

This UAE fund has been conducting due diligence for months. Today’s meeting between IPTO and TAQA officials in Cyprus suggests TAQA is seriously considering to join the Great Sea Interconnector consortium.

In addition, IPTO is preparing to forward the consortium’s terms to Israeli fund Aluma. The two sides had signed a Memorandum of Understanding last year in view of this fund’s entry into the project.

Without a doubt, growing interest for involvement in the Great Sea Interconnector expressed by US state fund Development Finance Corporation ranks as standout news.

Following up on talks with Greek deputy energy minister Alexandra Sdoukou in Washington last December, DFC’s leadership is believed to have expressed interest to participate in the project by either becoming a stakeholder with a 50 million-euro sum or by contributing to its financing.

Though DFC has not yet gone into details, US state participation in the project would align with American energy security interests in the eastern Mediterranean region and also boost the project’s geopolitical standing.

IPTO, Nexans discuss Crete-Cyprus grid link details

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An electrical grid interconnection to link the Cretan and Cypriot systems, work on which began last month, was essentially officially launched yesterday at a meeting in Athens between Greek power grid operator IPTO’s leadership and top officials of French multinational cable and optical fiber industry Nexans.

During the session – the first major meeting between IPTO’s leadership and Nexans’ chief operating officer Mathias Bruneau, who led a ten-member team – the cooperation’s principles, as well as project fundamentals, including when deep-sea surveys would commence, the interconnection’s routing and schedule, were all discussed in detail.

Installation of the project’s cable is planned to begin in 2026 and be completed in 2029. The Crete-Cyprus grid interconnection, a project budgeted at 1.2 billion euros, will cover a distance of 898 kilometers.

Just days ago, IPTO, the Greek power grid operator, reached an agreement with its Israeli counterpart to assemble technical teams for a cost-benefit analysis concerning the project’s next stage, to link the Cypriot and Israeli electrical grids.

Energy regulators of both countries will rely on the results of the CBA to divide costs that will be recovered through regulated revenues.

The wider project’s two sections, dubbed the Great Sea Interconnector, planned to link the Greek, Cypriot and Israeli electrical grids, will cover a total distance of 1,208 kilometers and is budgeted at 2.4 billion euros.

 

Activity abounding for €1.9bn Great Sea Interconnector

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Greek power grid operator IPTO, project promoter of the Great Sea Interconnector, a 1.9 billion-euro project planned to link the power grids of Greece, Cyprus and Israel, is engaged in talks with the European Investment Bank for a loan of approximately 500 million euros.

IPTO plans to soon stage a teleconference with EIB in order to provide additional information supporting this project as an optimal solution for Cyprus’ energy sufficiency in an effort to remove feasibility reservations expressed by the bank in the past.

Also, IPTO’s chief executive Manos Manousakis and associates have scheduled a series of meetings in Nicosia tomorrow, including with Cyprus’ finance minister Makis Keravnos, for the Cypriot state’s entry into the GSI project with an equity amount of up to 100 million euros. These meetings will be the latest of regular meetings agreed to with Cyprus for talks on the project’s progress.

Besides Israel fund Aluma and Abu Dhabi-based fund TAQA, other investors, both from the wider region as well as the USA, are believed to be interested in becoming project stakeholders.

In addition to the 500 million-euro loan for the GSI being discussed with EIB, a further 500 million euros in loans is expected to be extended by Greek banks, currently in talks with IPTO, while 657 million euros in EU funding is also anticipated.

Adding to the overall activity concerning the GSI’s development, a team of leading officials from Norwegian company Nexans is scheduled to visit Athens on March 13 for talks with IPTO’s leadership. Nexans has begun manufacturing work for the project’s cable.

US state fund DFC’s Great Sea Interconnector entry a catalyst

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The apparent interest of US state fund DFC becoming a stakeholder in the Great Sea Interconnector, planned to link the power grids of Greece, Cyprus and Israel, would serve as a catalyst for the project as such a development would not only offer an additional funding source to the 1.9 billion-euro project but also boost its geopolitical clout as a result of the US state’s participation.

DFC, the Development Finance Corporation, only supports and promotes projects around the world that are in line with US interests, its recent funding to Onex for the acquisition of the Elefsina Shipyards, west of Athens, being an example.

Planned to stretch 1,200 km and offer 2-GW power transmission capacity, the Great Sea Interconnector, the most mature of interconnection projects envisaged between Europe and the Middle East, certainly meets the regional interests of the US.

This project promises to greatly contribute to energy supply security in the eastern Mediterranean, diversification of supply sources and, above all, development of infrastructure capable of connecting different continents.

DFC, it is being reported, could enter the Great Sea Interconnector as a 10 percent stakeholder. If the American state fund does become part of the project, it would join Greek power grid operator IPTO, the project promoter through its special purpose vehicle; the Cypriot State; Israel fund Aluma; and Abu Dhabi-based fund TAQA.

 

Ariadne Interconnection launch expected in summer of 2025

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Ariadne Interconnection, a 1.1 billion-euro project to link the power grids of Crete and Athens, whose installation has reached the final mile, is expected to be completed by mid-2024, and should be electrified in 2024, enabling its commercial launch in the summer of 2025, Manos Manousakis, CEO at Greek power grid operator IPTO, developing the project,  has informed.

Once Ariadne Interconnection is operating, Crete, Greece’s largest island with a population of roughly 650,000, will be supplied its electricity from the mainland system rather than costly power plants now operating on the island.

The interconnection promises to reduce a public service compensation surcharge included in electricity bills by some 600 million euros annually, 400 million euros of which concern Crete.

Some of the island’s existing power plants are planned to be maintained to provide roughly 400 MW as back up. They include power utility PPC’s main power plant on Crete, at Linoperamata, west of Heraklion.

The Ariadne Interconnection project’s main building facilities on Crete, an AC-to-DC conversion hall, and the control building, are now close to being completed. Manousakis, IPTO’s CEO, will be visiting the facilities today. Corresponding facilities at the project’s Athenian end are also progressing.

The project’s completed smaller segment, running from Crete to the Peloponnese, has already benefited the island since its launch ahead of the summer of 2021, Crete’s first summer without power outages, Crete’s regional governor Stavros Arnaoutakis noted during a meeting with the IPTO chief yesterday.

The Great Sea Interconnector, a project to link the Cretan, Cypriot and Israeli grids,  estimated to be completed around 2029, promises to establish Crete as an energy hub, Arnaoutakis added.

March deadline for 20% stake in Ariadne Interconnection

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Qualifiers through to the second round of a tender offering a 20 percent stake in Ariadne Interconnection, a subsidiary founded by Greek power grid operator IPTO for the development of the Crete-Athens grid interconnection, are expected to be set a 1Q 2024 deadline for their binding bids, energypress sources have informed.

All four first-round entrants have qualified for the procedure’s next stage following approval by RAAEY, the Regulatory Authority for Energy, Environment, and Water. All four are expected to maintain their interest and submit binding bids.

The procedure’s Virtual Data Room, to offer bidders full details on the project, is expected to be made available early in the new year, the sources noted. The shareholders’ agreement and business plan are among the details to be made available to participants.

The tender’s four second-round participants are GEK-TERNA; a partnership involving Macquarie Super Core Infrastructure Fund and Phaethon Holdings (Copelouzos group); Italian operator Terna SpA; and StateGrid International Development Belgium.

Taking into account the Crete-Athens grid interconnection’s current rate of progress, IPTO expects the project’s development to be completed late in 2024 and, following testing, be ready for commercial launch by mid-2025.

Progress is also being reported on the equity make-up of the newly established Great Sea Interconnector, another IPTO subsidiary, established for the development of the electrical grid interconnection to link the Greek, Cypriot and Israeli systems.

The Cypriot State, which has already expressed interest to become a shareholder of the Great Sea Interconnector consortium, is working on completing its entry by late January.

IPTO has also signed Memorandums of Understanding for the same purpose with TAQA, the Abu Dhabi National Energy Company, and Israeli fund Aluma. Other investors, including from the USA, have also expressed interest to join the Great Sea Interconnector consortium.

IPTO’ aims to complete the Great Sea Interconnector consortium’s equity make-up by the end of March, 2024 with a majority stake for the operator and the Cypriot State.

Great Sea Interconnector development to begin in 2024

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Preliminary work on the Greece-Cyprus-Israel electricity interconnection, whose Cyprus-Israel segment has been named the Great Sea Interconnector, is planned to commence in 2024.

Development of a segment stretching from Crete to Cyprus is soon expected to get underway, while the development prospects of the project’s section from Cyprus to Israel are approaching readiness.

Also, as noted by Greek power grid operator IPTO’s chief executive Manos Manousakis in recent comments to Cypriot media, the Greek power grid operator plans to sign an agreement with Siemens late in 2024 for the construction of two converter stations required by the Cypriot and Cretan grids as part of the project’s development.

IPTO and Siemens have already signed an agreement concerning preliminary studies for these converter stations, Manousakis informed.

The IPTO chief, responding to a journalist’s question, informed that, based on the company’s Crete-Athens grid link experience, the Crete-Cyprus section of the project would require between four and five years to be completed from the date a final investment decision has been taken, essentially meaning a 2029 delivery date is likeliest.

The Cypriot and Israeli regulatory authorities still need to reach an agreement so that the Cyprus-Israel segment of the project can be considered sustainable through secured revenue.

The Cypriot State is expected to enter the Great Sea Interconnector, an IPTO subsidiary, with an initial sum of approximately 100 million euros.

The project is budgeted at 1.9 billion euros, with 657 million euros secured through the Connecting Europe Facility.

Cypriot State’s entry into Great Sea Interconnector assured

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The Cypriot State’s entry into Greek power grid operator IPTO’s Great Sea Interconnector subsidiary formed for the development of a Greece-Cyprus-Israel electricity interconnection is considered certain following positive high-level talks held yesterday in Cyprus.

An IPTO team led by CEO Manos Manousakis discussed the project with Cyprus’ president Nikos Christodoulides, joined by administration’s energy minister Giorgos Papanastasiou. The IPTO team also met with Cyprus’ regulatory authority for energy.

It is now considered just a matter of time before the finalized results of a feasibility study conducted on behalf of the Cypriot State are delivered. The study is expected to give the green light for a final investment decision.

The Cypriot State is expected to enter the Great Sea Interconnector subsidiary with an initial sum of 100 million euros from the Recovery and Resilience Facility (RRF).

IPTO is also expected to hold talks with two other prospective Great Sea Interconnector entrants, Israeli fund Aluma, and TAQA, the Abu Dhabi National Energy Company, for their participation in the project, budgeted at 1.9 billion euros, with 657 million euros secured through the Connecting Europe Facility.

The consortium could feature the three aforementioned participants along with IPTO, but it is still too early to tell if this could result in respective 25 percent stakes for all four.

Greece-Cyprus-Israel power grid link nearing development

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The Greece-Cyprus-Israel electricity interconnection, now named the Great Sea Interconnector, is nearing development, its prospects driven by new investors and, above all, increased funding.

The project’s next big steps will develop along three fronts. Firstly, Norwegian company Nexans will install the cable section of the Crete-Cyprus interconnection, which, according to Manos Manousakis, CEO of Greek power grid operator IPTO, is imminent.

Secondly, the Greek operator will hold discussions with three prospective investors, namely the Cypriot State, Israeli fund Aluma, and TAQA, the Abu Dhabi National Energy Company, for their participation in the project.

Thirdly, funding details needs to be shaped. These details remain unclear at this stage as the project’s shareholders, and their stakes, have yet to be finalized.

The consortium could feature the three aforementioned candidates, along with IPTO, but it is still too early to tell if this could result in respective 25 percent stakes for all four.

A 657 million-euro sum from the project’s 1.9 billion euro has been secured through the Connecting Europe Facility. The remaining 1.3 billion euros will be raised through bank loans, both through the EIB and commercial banks, as is customary for this type of project.

Nexans is expected to begin installing the project’s cable for the Crete-Cyprus section as soon as a deposit is provided by CINEA, the European Climate, Infrastructure and Environment Executive Agency, managing decarbonization and sustainable growth.