National Bank of Greece (Cyprus): Embracing the Future of Sustainable Energy

Europe at a Glance

In November 2023, the revised Renewable Energy Directive entered into force, marking a significant milestone in the EU’s clean energy transition. This new legislation aims to increase the share of renewables in the EU’s overall energy consumption, raising the binding target for 2030 to 42.5%, with the ambition to reach 45%.

The European Commission has mobilized close to €300 billion to fund the REPowerEU Plan, a comprehensive strategy designed to enhance energy security, reduce dependence on fossil fuels, and accelerate the green transition. For Cyprus, this means access to substantial funding to develop renewable energy projects, improve energy efficiency, and build the infrastructure necessary for a sustainable energy future.

Cyprus’ Footprint

Cyprus is at the forefront of an energy revolution, driven by European and government incentives and a strong push towards renewable energy and energy efficiency. The country’s ambitious targets for increasing renewable energy adoption and enhancing energy efficiency require the creation of a favourable environment to attract interest in sustainable investments. This involves not only legislative support but also the implementation of policies that encourage the growth of renewable energy projects and innovations in energy efficiency.

The solar energy market in Cyprus is experiencing significant growth, driven by the island’s abundant sunshine and favourable investment climate. This trend is expected to continue, supported by advancements in technology, the decreasing costs of solar panels and increasing investment flows. The island’s potential to cover most of its growing energy demand through renewable energy is substantial, making solar power a cornerstone of Cyprus’s energy strategy.

The energy revolution in Cyprus is not just about adopting new technologies but also about creating a sustainable energy ecosystem that supports economic growth, environmental protection and energy security. The continued growth of the solar energy market, supported by favourable investment conditions and technological advancements, will be crucial in meeting the island’s increasing energy demands sustainably, as well contributing to a positive net effect on jobs and Gross Value Added.

According to preliminary findings from McKinsey Research, the total capital expenditure required for Cyprus to reach net zero status by 2050 is estimated at €40 billion, primarily in the transport, construction and energy sectors. The highest capital expenditure will be related to the decarbonization of transport, power and buildings.

In conclusion, the combination of ambitious targets, supportive legislation, significant funding and abundant natural resources creates a promising outlook for the future of renewable energy in Cyprus.

The Challenges

Cyprus faces a complex trilemma in its energy sector: decarbonization, affordability, and security of supply. Addressing these challenges requires a multifaceted approach, including the development of energy storage solutions and upgrading the island’s grid capacity.

To ensure a stable and reliable energy supply, Cyprus will need to invest in energy storage systems. These are crucial for balancing the intermittent nature of renewable energy sources like wind and solar power. The strong inverse relationship between wind and solar electricity production can lead to periods of reduced overall energy output. Therefore, short-term energy storage systems are necessary to store excess energy generated during peak production times and release it when production is low.

Upgrading the grid capacity is equally important to accommodate the increasing share of renewable energy. A modernized grid will be better equipped to handle fluctuations in energy production and distribution, ensuring that energy is delivered efficiently and reliably across the island.

Despite the challenges associated with infrastructure development and initial investment costs, the long-term benefits of renewable energy and energy efficiency are undeniable. Investing in renewable energy leads to reduced energy costs over time, as the price of renewable technologies continues to decrease and operational costs remain low. Enhanced energy security is another significant benefit, as reliance on local renewable energy sources reduces dependence on imported fossil fuels and mitigates the risks associated with global energy market fluctuations.

The establishment of interconnection grids with Europe and Israel presents a significant opportunity for Cyprus. These interconnections allow for the potential export of green energy surpluses, boosting the country’s economic and geopolitical standing.

By linking with other energy markets, Cyprus can access additional sources of energy during periods of high demand or low local production, ensuring a consistent and reliable energy supply.

NBG CYPRUS – A Century of Trust and Innovation

We, at the National Bank of Greece (Cyprus) are proud to be part of an institution rooted in tradition and innovation, now pioneering the path toward a sustainable future.

National Bank of Greece is the leader in sustainable energy financing in Greece. As the market leader in Energy Projects, with an associated total portfolio that exceeds €4 billion in drawn facilities and €6 billion including drawn facilities, LGs and LCs, it maintains its No.1 position for financing renewable projects.

With over a century of remarkable presence on the island, NBG Cyprus is uniquely positioned to offer investors unparalleled opportunities in the rapidly evolving energy sector. Committed to Environmental, Social, and Governance (ESG) principles, our vision reflects our dedication to sustainable development. This commitment is manifested in our strategic initiatives aimed at fostering energy investments and promoting energy-saving solutions across Cyprus.

NBG Cyprus has financed part of the construction cost of 6 P/V Parks with a total capacity of 10MW and is currently assessing a project for the construction of a power plant in the Larnaca district, to produce energy through the use of conventional fuel and natural gas with a total capacity of 105MW.

Our services

Renewable Energy Financing

Bespoke financing solutions for renewable energy projects, including solar and wind energy. Our goal is to facilitate substantial reductions in carbon emissions while delivering economic benefits & substance to our customers/partners.

Energy Efficiency Loans

Our specialized loans are designed to fund energy efficiency improvements. These loans support investments in advanced technologies that reduce energy consumption, such as state-of-the-art HVAC systems, energy-efficient lighting, and comprehensive building insulation.

Support for Sustainable Businesses

We provide extensive support to businesses aiming to enhance their sustainability. Whether it’s through adopting cutting-edge green technologies or optimizing existing processes for energy efficiency, NBG Cyprus delivers the financial tailormade solutions and expert guidance necessary for success.

Why partner with NBG CY?

Experience and Stability

With over a century of banking experience backed with NBG Group’s excellence in the industry, NBG Cyprus provides the stability and expertise necessary to support complex and large-scale energy projects.

Partnership and Expertise

Our highly trained team, with in-depth technical expertise, offers prompt service and advisory to increase your turnover and your profitability.

Comprehensive Financial Solutions

Our extensive array of financial products and services are tailored to meet the specific needs of our investors, ensuring that every aspect of their investment is supported.

Commitment to Sustainability

Sustainability transition requires an upfront initial capital expenditure that leads to lower operating expenditure in the medium-long term, supports profitability and secures return of invested funds. NBG Cyprus’s unwavering dedication to sustainable development and the establishment of long-term relationships, ensures that your investments not only yield financial returns but also contribute to a greener, more sustainable future.

Building a Sustainable Future Together

Investing with the National Bank of Greece in Cyprus means more than just financial growth, it means contributing to a sustainable and prosperous future.

CONTACT DETAILS

Headquarters Address: 15, Archbishop Makarios III Avenue, 1065 Nicosia, Cyprus

Tel: (+357) 22040000

Website: www.nbg.com.cy

(This article first appeared in the July issue of GOLD magazine. To view it click here)