In-depth assessment of the energy efficiency potential in Cyprus
Journal
Cyprus Economic Policy Review
Date Issued
December 2017
Abstract
This paper presents results from the first in-depth study on the energy efficiency potential in Cyprus.
Different energy models were combined in order to conduct simulations and provide
recommendations to national authorities so that Cyprus can meet its targets in the frame of the EU
energy and climate policies. The study assessed both the maximum theoretically available potential
for energy efficiency improvements and the economically viable potential, and then translated these
assessments to aggregate energy demand forecasts. The analysis shows that Cyprus cannot continue
along a ‘business-as-usual’ path in improving the efficiency of its energy system if it is to achieve the
EU decarbonisation goals for year 2030 and beyond. In theory, there is a large potential to increase the
energy productivity of the Cypriot economy, its exploitation requires a very substantial mobilisation
of financial resources, at a rate that has not been observed in the past. An intensification of smart
financial tools to enable energy efficiency investments, coupled with a green tax reform that will
gradually implement a carbon tax while reducing the tax burden of labour, can facilitate a smooth
transition to a low-carbon economy
Different energy models were combined in order to conduct simulations and provide
recommendations to national authorities so that Cyprus can meet its targets in the frame of the EU
energy and climate policies. The study assessed both the maximum theoretically available potential
for energy efficiency improvements and the economically viable potential, and then translated these
assessments to aggregate energy demand forecasts. The analysis shows that Cyprus cannot continue
along a ‘business-as-usual’ path in improving the efficiency of its energy system if it is to achieve the
EU decarbonisation goals for year 2030 and beyond. In theory, there is a large potential to increase the
energy productivity of the Cypriot economy, its exploitation requires a very substantial mobilisation
of financial resources, at a rate that has not been observed in the past. An intensification of smart
financial tools to enable energy efficiency investments, coupled with a green tax reform that will
gradually implement a carbon tax while reducing the tax burden of labour, can facilitate a smooth
transition to a low-carbon economy
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