Meridiam’s 66% faces the tariff test

French infrastructure investor Meridiam now controls the company behind the Great Sea Interconnector (GSI), the planned undersea electricity link from Crete to Cyprus. The deal signed on 5 August gives Meridiam 66% and leaves ADMIE, Greece's transmission operator, with 34% and the technical lead (Enerdata, energynews.pro). Based on the public record, Meridiam has made GSI more attractive to lenders. But there is still no proof that it is ready to finance or build.

What changed and what didn't

The project company is a special-purpose vehicle (SPV), a ring-fenced entity that holds all the rights, contracts and future revenues for the cable. Meridiam buying majority control means a serious private investor now stands behind the project, reducing dependence on ADMIE's balance sheet alone. Meridiam's business model is holding regulated infrastructure for decades, which is exactly the profile lenders want to see.

What Meridiam did not buy is a finished route, committed lenders, permission to recover costs through electricity bills, or a manufacturer visibly building the cable into its delivery plan. Cable-maker Nexans qualified its deep-sea technology for 3,000-metre depths in late August, so the cable looks technically feasible. But Nexans's January statement spoke of "schedule rearrangement," and its H1 2026 results did not tell investors that GSI execution had started.

The revenue question lenders need answered

Greece's energy regulator RAAEY was still consulting until 11 September on the most important number in the project: how much the project company can recover from electricity users over time. Lenders price their loans off that promise. Until regulators set the formula, no bank can commit.

One piece of that formula is the WACC (the weighted average cost of capital, the return regulators allow investors and lenders to earn through system charges). ADMIE proposed lowering the assumed debt share during construction to 50%–60%, down from an earlier 60%–80% range (OT, Sigmalive). A lower assumed debt share typically means a higher allowed return, which makes the project more attractive to equity investors like Meridiam but raises charges for users.

Cyprus is deciding whether consumers start paying before the cable exists

Cyprus is the sharpest bottleneck. Energy Minister Michalis Damianos welcomed Meridiam's entry but said final decisions depend on European Investment Bank due diligence, which remains a study request, not a granted loan. No cabinet or regulator decision on who pays which part has been published.

Cypriot reporting says the government will pay €125 million during construction, triggered by the issuance of a NAVTEX (a maritime notice authorising survey work at sea), with two instalments already treated as outstanding. That NAVTEX has not been published. Coverage describes a possible October issuance, with unfinished surveys running through waters where Turkey has signalled objections. Foreign Minister George Gerapetritis said Greece would not seek Turkey's permission. That clarifies Athens's political stance without settling the operational risk of surveying contested seabed.

Who gains, who carries the cost

Regulated assets are attractive because future users, not just shareholders, repay approved costs over time. Meridiam gains control of exactly that kind of asset, backed by roughly €657 million in EU grant funding (CINEA, Euronews). ADMIE sheds financing exposure while keeping engineering fees and the operator role. If the cable works, Cyprus ends its electrical isolation from the continental European grid, gaining access to cheaper imports and supply security.

The risk sits mainly with Cypriot consumers and taxpayers. Cost recovery means regulators allow the project company to earn back approved spending through electricity charges before the cable delivers a single electron. That is standard for infrastructure finance. But for a project routed through contested waters with an estimated cost above €1.9 billion (Euronews), the full contractual terms for overruns, security delays and refinancing remain unpublished.

The ownership change is real. RAAEY's consultation closes on 11 September, and Cyprus's tariff and EIB decisions will show whether Meridiam's capital can pull enough institutional commitments to move a cable from a shareholder table into the Mediterranean.