How it works

Transitional electricity market

The transitional electricity market is the market currently operating in Cyprus. The start of the market began on 01/01/2021. Private Producers and private Suppliers participate in the Transitional Market. EAC    Production and EAC Supply do not participate in this market. 

Producers can participate in the transitional market by producing energy through  conventional power  plants or through renewable energy  sources (RES) units. The participation threshold for producers, if they hold The production permit for a unit with a net rated power is of 4.5MW or more.

Suppliers participating in the transitional market are responsible for meeting the needs of the customers they represent. The final customers that can be represented are commercial tariffs with installed STOD (Seasonal Time of Day) meters  or with final customers who intend to change their meter.  The participation threshold for suppliers is the representation of consumers with a total power of 10MW or more.

Producers and Suppliers participate in the market by concluding bilateral contracts between them. Participants conclude Bilateral Contracts for the purchase and sale of a specific amount of energy on a monthly basis, where it applies to meet the needs of the  supplier’s consumers for the   entire calendar  month.

Bilateral contracts shall be declared  to the Cyprus Transmission System Operator (TSO) up to three working days before the start of the trading month. For producers and suppliers there is a tolerance rate in case of deviations from the declarations of their bilateral contracts. This is set at 30% for renewable energy producers, 2% for energy producers through  conventional units and 10% for suppliers. This percentage is set by the Cyprus Energy Regulatory Authority (CERA).

Participants are cleared by the TSO on a monthly basis. There are deviation credits and additional charges if the tolerance limit is exceeded.  For the producer where he produces a greater  amount of energy than declared, he is credited with the unit price of the  avoidance costs. On the contrary, in case a smaller amount of energy is produced than the declared one, it is charged with the price of the weighted average (D-X).  For the supplier in case the total consumption of his customers is less than the declared one is paid at the price of the  avoidance cost. Conversely, if the total consumption of its customers is greater than the declared one, it is charged at the price of  the weighted average D-X.