The European Union has earmarked 657 million euros ($736 million) for the construction of a 2,000-megawatt undersea electricity cable that will link the power grids of Israel, Cyprus and Greece, Greek Cypriot Energy Minister Natasa Pilides said Thursday.
Pilides told reporters the funding is Greek Cyprus’ largest-ever investment as well as the lion’s share of the total sum that the EU’s Connecting Europe Facility, which bankrolls infrastructure projects, has allocated to a single project this year.
Pilides said the money enables crews to start constructing the segment of the cable that will connect Greek Cyprus with the Greek island of Crete, with the total cost estimated at roughly 1.6 billion euros. Negotiations to transfer the funds are expected to wrap up this summer.
The minister added that beyond the project’s geopolitical weight, it will ensure Greek Cyprus’ energy security, boost competitiveness in the power supply sector and help the island nation more easily transition to a green economy.
With the cable’s completion, it’s expected that more investment will flow into renewable energy sources enhancing the energy mix of Greece, Greek Cyprus and Israel. Pilides said a study shows that the cable in combination with power storage facilities could push Greek Cyprus’ use of renewable energy sources above 50% by 2030.
Pilides and her Greek and Israeli counterparts signed an agreement last October to speed up technical work on the cable dubbed the "Eurasia Interconnector."
The agreement aimed to expedite permits and approvals for feasibility studies and to help the three countries’ national electricity coordinators to cooperate on how best to move forward. The cable’s first phase is expected to be completed by 2025.
The line is however is set to encompass Turkey’s continental shelf, which is why Ankara has been objecting the project.
Turkey had previously sent a diplomatic note to the Greek and Israeli embassies in Ankara and the EU Turkey delegation directorates because the EU-supported project, which was established with a memorandum of understanding signed between Israel, Greece and the Greek Cypriot administration in March last year, passes through Turkey's continental shelf in the Eastern Mediterranean, between the islands of Cyprus and Crete.
The move toward an electricity cable link appears to have supplanted plans for a potential pipeline connection between the three countries to send gas from existing and potential deposits off the island of Cyprus and Egypt to Europe through Greece.
Support for the so-called East Med pipeline project has waned amid questions over its feasibility as well as its adverse impact on the environment.
Greek Cypriot President Nicos Anastasiades said last week that studies on the pipeline’s feasibility were still ongoing, but other alternatives are open to get gas to markets.
Earlier, the United States voiced its concerns over the planned subsea pipeline to provide natural gas from the Eastern Mediterranean to Europe in an apparent U-turn from the previous Trump administration's position.
Turkey’s view, however, is that any project that aims to sideline the rights of Turkey and the Turkish Republic of Northern Cyprus (TRNC) in the Eastern Mediterranean will be unsuccessful.
Greece has often been embroiled in tensions with neighboring Turkey over a range of issues, from competing claims over hydrocarbon resources in the Aegean Sea to the demilitarization of islands. Greece's burgeoning arms program is designed to counter Turkish rights in the Eastern Mediterranean, against which France is among the few EU states to have offered public support in past months.
Turkey, which has the longest continental coastline in the Eastern Mediterranean, has rejected maritime boundary claims made by EU members Greece and the Greek Cypriot administration, stressing that these excessive claims violate the sovereign rights of both Turkey and the Turkish Cyprus. Both sides cite a range of decadeslong treaties and international agreements to support their conflicting territorial claims.