“EAC’s budget for 2003 estimates that total expenditure is to reach CYP 277 million, while cash deficit will not exceed CYP 73 million (CYP 44 million to be financed by taxes (surplus) and CYP 29 million by foreign borrowing). It also estimates that total revenues of CYP 218 million and operating expenditure of CYP 189 million will result in surplus of CYP 22 million, following the deduction of CYP 7 million”, said EAC’s Board Chairman, Georgos Georgiades, to the Parliamentary Finance Committee in the framework of his analysis over the budget for 2003 and EAC’s policy of development.

Mr. Georgiades stressed that the budget for 2003 does not provide any further rate increases, as power supply rates have remained at the same level since 1983. This gradual policy of imbalance, however, does not entail the inter-allowances among consumers.

“Capital expenditures concern investments that are to reach CYP 102 million, especially development works with regard to production, transfers and distribution of power energy. EAC anticipates the expansion of the production system by constructing a third and a fourth unit in the framework of the second phase of in Vasiliko Plant”, Mr. Georgiades said.

During 2000, all offers accepted the tender and the construction of Unit 3 has already commenced (estimated to reach CYP 32 million for 2003, and be ready by April 2005) while total cost is to reach CYP 80 million.

In the face of its lining with the EU instructions and the termination of pollution, EAC anticipates the creation of the first Aeolian park of CYP 5 million at the area of Kourris, as well as the creation of a wind-generator (600-1000 MN) of CYP 1.3 million at Vasilikos station.

Meanwhile, most attendants were very much taken aback by the dramatic rise in premiums to insure EAC’s property (electricity power stations, sub-stations, offices and storage). According to Mr. Georgiades, insurance companies – in the aftermath of the terrorist attack of September 11 – raised premiums from CYP 320 thousand per annum to CYP 1.4 million per annum, despite the fact that they do not include cover against terrorist attacks. The estimated insurance cover for 2003 is expected to reach CYP 2 million.

Within the framework of EAC’s harmonization with the EU, officials have already drafted the relevant legislation and regulation. “EAC is in cooperation with international consultants preparing the regulations of the Administration of Signal Transfer and Distribution of Power Energy, which is expected to be ready by the end of the current year”, Mr. Georgiades noted.