Probe finds holes, profiteering in green power subsidies

The Audit Office of the Republic of Cyprus recommended to the state authorities to stop subsidizing the country’s wind farms to avoid further strain on the Renewable Energy Sources Fund and thus the taxpayers.

An administrative procedure was conducted after a request in July last year by Andros Kyprianou, leader of the opposition and general secretary of the communist Progressive Party of Working People (AKEL). Auditors found irregularities in the system for subsidizing wind power and photovoltaic facilities. Particular stress was placed on licencing in the wind segment from July 2009 through the following year, when Kyprianou’s predecessor Demetris Christofias was head of state. The internal rate of return, a gauge of profitability, was registered to be much higher than 12% to 13%, granted by the European Commission, the report noted.

According to the document, the findings could be used by the government as a reason for disengagement from the agreements concerning stimulation. The independent institution indicated the offices of the attorney general and state aid commissioner could get involved.

The cabinet plans to lift the fee charged to all electricity consumers from 0.5 euro cents to 1.35 per kWh to ensure the viability of the said green fund. The new tariff would apply until the end of next year.