Overview

Despite the temporary effects of the economic recession of years 2012-2015, energy consumption in Cyprus was higher in 2018 than in 2000. Increases in energy demand of both transport and buildings (residential and services) have been responsible for this development, while the share of industry in energy consumption has dropped both because of the smaller share of industry in total economic activity in 2018, and thanks to energy efficiency improvements in major industrial plants.

Figure 1: Final energy consumption by sector (normal climate)

Source: ODYSSEE

Overall technical energy efficiency has improved by around 25% in Cyprus between 2000 and 2018. This has been driven by energy efficiency improvements in all sectors - buildings, industry and transport. Industry has shown the fastest increase in energy efficiency, mainly because the largest industrial energy consumer is by far the cement industry, which has undergone a major reconstruction and refurbishment of its plants. Transport has demonstrated the slowest energy efficiency improvement, especially in 2000-2015; both road transport and air transport have been responsible for the lack of progress in energy efficiency. Over the last years (2015-2018) progress in the residential and service sectors has remained stagnant too.

Figure 2: Technical Energy Efficiency Index

Source: ODYSSEE

Table 1: Sample of cross-cutting measures

MeasuresNEEAP measuresDescriptionExpected savings, impact evaluationMore information available
Energy efficient street lightingyesReplacement of existing lighting systems in public roads (motorways and local roads) with new, more efficient ones, in the period 2018-23. 20 TJ energy savings by 2023, 4.2 kt CO2 emission reductions by 2023Link
Net billing scheme for high-efficiency cogeneration (HECHP)yesApplies to commercial, industrial and public administration consumers for the installation of HECHP systems of up to 5 MW mainly for covering their own consumption70 TJ energy savings by 2030, 6.1 kt CO2 emission reductions by 2030Link
Fund of Funds providing soft loans for energy efficiencyyesLow-interest loans by private banks to cover the capital cost for implementing energy efficiency investments. Target groups are households, SMEs and public sector210 TJ energy savings by 2023, 18.4 kt CO2 emission reductions by 2023Link
Source: MURE

Buildings

Energy efficiency in the buildings sector of Cyprus has improved steadily since the adoption of energy performance standards in the mid-2000s, and as a result of the implementation of all relevant EU legislation. Still, energy consumption of buildings is stagnant or even slightly grows as a result of the increasing number and size of dwellings, which outweighs energy efficiency improvements, and the increased utilisation of space heating appliances in modern buildings. Because of the relatively mild winters in Cyprus, space heating was used less in earlier years, but modern residential and office buildings always include space heating installations.

Figure 3: Energy consumption of space heating per m2 (normal climate)

Source: ODYSSEE

Figure 4: Energy consumption per dwelling by end-use (except space heating)

Source: ODYSSEE

Residential energy consumption per dwelling has fallen somewhat between 2000 and 2018, reflecting the improved energy performance of new buildings as well as the effect of a limited number of energy renovations in existing buildings. The share of main end uses in energy consumption does not seem to have changed significantly. Electrical appliances are responsible for the highest part of final energy consumption, followed by water heating - which however is predominantly satisfied through solar water heaters.

Figure 5: Main drivers of the energy consumption variation of households

Source: ODYSSEE

The increase in the number and size of dwellings has been primarily responsible for the rise in total residential energy consumption between 2000 and 2018. It has been only partly counterbalanced by energy efficiency improvements.

Figure 6: Energy and electricity consumption per employee (normal climate)

Source: ODYSSEE

Energy consumption per employee in the service sector of Cyprus has declined, essentially after 2010, as the combined effect of the economic downturn of 2012-2015 and energy efficiency improvements. The sector depends on electricity by more than 80% to cover its energy needs.

Table 2: Sample of policies and measures implemented in the building sector

MeasuresDescriptionExpected savings, impact evaluationMore information available
Smart electricity metersThe measure concerns the gradual installation of 400,000 electricity smart meters on the building stock of the country between the period 2021-202770 TJ annual energy savings, 6.1 kt annual CO2 emission reduction by 2030Link
Reduced VAT for energy renovations in the residential sectorSince December 2015, renovations of private residences are subject to a VAT rate of 5% instead of the standard VAT rate of 19%. The renovations subject to reduced VAT include thermal insulation of external walls and replacement of doors and windows of the building.Link
Access to finance for energy renovationsLow-Interest Loans Provided by the Cyprus Cooperative Bank13,5 TJ annual energy savings, 1.52 kt annual CO2 emission reduction in 2020 Link
Support schemes for promoting energy efficiency investments in buildingsRenovations of existing dwellings are co-funded by this scheme. They address Individual energy efficiency measures in public buildings and dwellings.1.56 PJ cumulative energy savings by 2025Link
Source: MURE

Transport

Transport accounts for half of final energy consumption in Cyprus. This is due to the very low use of public transport, despite recent investments in public buses which have not been adequate to induce a significant modal shift in passenger transport - which is still dominated by cars.

Figure 7: Transport energy consumption by mode

Source: ODYSSEE

Attempts to strengthen the public transport system, which consists of urban and interurban buses, have not been effective up to now. Therefore, the share of cars in total passenger traffic has remained very high in Cyprus; in fact it has slightly risen further between 2000 and 2018.

Figure 8: Modal split of inland passenger traffic

Source: ODYSSEE

Inland freight transport is conducted only with trucks.

Figure 9: Modal split of inland freight traffic

Source: ODYSSEE

Despite some energy efficiency improvements because of the gradual renewal of the stock of motor vehicles, increases in total passenger kilometres and tonne kilometres travelled have been stronger; therefore total energy consumption of transport has risen by more than 25% between 2000 and 2018.

Figure 10: Main drivers of the energy consumption variation in transport

Source: ODYSSEE

Table 3: Sample of policies and measures implemented in the transport sector

MeasuresDescriptionExpected savings, impact evaluationMore information available
CO2-based vehicle taxationAnnual circulation taxes are mainly calculated on the basis of a vehicle's certified CO2 emission levels. The CO2 component was strengthened in 2019.Link
Source: MURE

Industry

Industrial activity in Cyprus has been steadily declining. This has led to a drop in final energy consumption of the industrial sector. The fall in energy use has been accelerated by substantial energy efficiency improvements across the sector and mainly in the cement industry.

Figure 11: Final energy consumption of industry by branch

Source: ODYSSEE

Final energy consumption of the industrial sector in Cyprus has dropped substantially over the last two decades because of a strong decline in industrial economic activity. The non-metallic minerals sector, dominated by the cement industry, is currently the only energy-intensive industrial activity in Cyprus and is responsible for more than half of industrial energy use.

Figure 12: Unit consumption of energyÔÇÉintensive products (toe/t)

Source: ODYSSEE

Unit consumption of the cement industry - the only energy-intensive industry of Cyprus - has declined since 2000. The increase after 2012 is an artefact of the decreasing denominator of this index (tonnes of cement production) because production of cement has dropped substantially in 2013-2015 because of the decline of the Cypriot construction industry due to the economic downturn. However, production of clinker (which was exported for cement production abroad) continued and hence energy consumption of the cement plant continued as well.

Figure 13: Main drivers of the energy consumption variation in industry

Source: ODYSSEE

Energy savings, mainly effected in the cement industry, as well as structural changes (i.e. a shift towards less energy intensive industrial activities) have been the major contributors of the decline in industrial energy consumption.

Table 4: Sample of policies and measures implemented in the industry sector

MeasuresDescriptionExpected savings, impact evaluationMore information available
Energy auditsApart from organisaitons that are legally obliged to conduct energy audits, grants have been available to other businesses for voluntary energy audits and the implementation of recommendations included the energy audit report.25 TJ energy savings by 2020, 3.6 kt CO2 reduced by 2020energy.gov.cy
Source: MURE