UAE’s Taqa explores stake in $2.1bn subsea cable project connecting Greece and Cyprus

The undertaking is at an advanced stage, with feasibility studies completed and contracts reserved for two major engineering, procurement and construction components

Cyprus has remained completely isolated from all energy networks within the EU, leading to a steady rise in electricity tariffs. Getty Images

Abu Dhabi National Energy Company, better known as Taqa, has signed an initial agreement to explore the prospect of becoming a shareholder in a project involving a high-voltage direct current (HVDC) subsea power cable between Greece and Cyprus.

Taqa will consider joining the Independent Power Transmission Operation of Greece (IPTO) and the Cyprus government as shareholders in the project, which is estimated at about €1.9 billion ($2.07 billion), the company said on Monday.

The project is at an advanced stage, with feasibility studies completed and contracts reserved for two major engineering, procurement, and construction (EPC) components.

“Taqa is pleased to announce its involvement in another transformative project, which will increase energy security and accelerate the deployment of clean energy in the eastern Mediterranean,” said its group chief executive Jasim Thabet.

“HVDC projects are vital to connect clean energy projects to the end users, and we are ambitiously accelerating investment and growth in our infrastructure business.”

Taqa has signed a memorandum of understanding to explore the possibility of becoming one of the shareholders in a project to develop a 900km high-voltage direct current (HVDC) electricity interconnection between Greece and Cyprus. Photo: Taqa

Taqa said in April that it had invested £25 million ($31.72 million) in British start-up Xlinks, which plans to build the world's longest high-voltage direct current subsea power cable between Morocco and the UK.

Last month, Taqa revised its growth targets to boost the size of its assets base, as it committed Dh75 billion ($20.4 billion) in infrastructure investments amid healthy earnings growth.

The company is aiming for 150 gigawatts of gross power generation by 2030 and plans to have a larger share of renewables within its portfolio by 2030.

The latest project is expected to increase energy security in the eastern Mediterranean and encourage the development and export of clean energy to Cyprus, Greece and the rest of the EU.

“Cyprus and Greece have some of the highest potential for renewable energy in Europe for both solar and onshore and offshore wind power generation, making the two countries ideal locations for a project of this kind,” Taqa said.

Greece's largest solar park in Kozani. Bloomberg

Among all EU member states, Cyprus was the only one that did not achieve the target of having at least 10 per cent electricity interconnection by 2020.

The island state has remained completely isolated from all energy networks within the bloc, leading to energy poverty and a steady rise in electricity tariffs.

“The project is also key to reaching Cyprus’ wider energy strategy goals of fortifying its energy security, reducing the cost of electricity for the benefit of our economy’s competitiveness, as well as expediting our green transition,” said George Papanastasiou, Cyprus' Minister of Energy, Commerce and Industry.

By 2030, Greece plans to have 2 gigawatts of offshore wind power, which is equivalent to 10 per cent of its current electricity capacity.

The country has managed to lower its share of fossil fuels in its energy supply to 82 per cent in 2021, from 91 per cent in 2011, according to the International Energy Agency.

However, renewable energy projects in Greece have faced delays due to a lack of grid capacity.

“We are very much looking forward to a close and fruitful co-operation with all stakeholders in order to expedite a project of strategic importance which enhances the energy security and the green transition in the eastern Mediterranean, bringing the region closer to the electricity system of Europe,” said Manos Manousakis, president and chief executive of IPTO.