Meridiam Backs Cyprus Cable Budget

Cyprus still sits on the edge of Europe's electricity map. It is the only EU member state whose power grid is not physically connected to the rest of the bloc (European Commission). A subsea cable from Crete would change that, tying the island into the European system and ending an isolation that has long made its electricity market more vulnerable than most.

On 5 August, the project gained a heavyweight backer. French infrastructure investor Meridiam signed a deal to become majority shareholder in Great Sea Interconnector, the company developing the cable (Baird Maritime, Proto Thema). That gives the scheme a serious financial sponsor. It still does not give it a committed construction budget.

What Meridiam bought — and what's still missing

Meridiam is taking a stake of more than 50%. ADMIE, Greece's independent grid operator, had controlled the project since taking it over from an earlier development structure in October 2023. It remains as minority partner, with responsibility for the engineering work during development and for operating the cable if it is built (Iefimerida).

A separate agreement with French cable maker Nexans covers seabed surveys, the practical preparatory work needed before engineers can confirm the route and the conditions under the sea (Newsit).

That order of events matters. The surveys come before the final investment decision, or FID, which is the point at which sponsors actually commit to funding the full build. Meridiam's arrival gets the cable to the next stage of development. It does not yet get it over the financing line.

The terms have not been published. Baird Maritime reported that no deal details were disclosed (Baird Maritime). One Greek outlet cited a €250 million Meridiam investment, but no Meridiam source has publicly confirmed that figure (in.gr). The precise shareholding, board arrangements and equity commitment remain unclear.

Some money has already gone out the door. As To Brief previously reported, €251.4 million had been paid to Nexans by the end of 2024 and 160 km of cable had been produced, even though the full notice to proceed on a contract worth about €1.43 billion plus VAT had not been issued. Nexans had also been negotiating a bridge order to cover the delay period (Capital.gr).

Who pays for the cable

The Crete-to-Cyprus section carries a reported budget of about €1.9 billion (Kathimerini, European Commission). An EU grant of roughly €657 million covers about a third, from the bloc's programme for cross-border energy infrastructure (EUR-Lex).

The rest, about €1.24 billion, has to come from the familiar mix behind big grid projects: shareholder equity, bank debt and regulated charges on electricity bills.

Cyprus carries the heavier burden. The agreed formula assigns 63% of the cable's costs to Cyprus and 37% to Greece, and Cypriot regulators have already approved €125 million in bill charges during the construction phase (Kathimerini). The pressure is not theoretical. Cyprus faces a possible power shortfall of roughly 750 MW after 2029 as ageing generators at Dhekelia and Vasiliko are retired, with planning based on the cable being operational by 2030 (Cyprus Mail).

Connection to a bigger grid does not, by itself, mean cheaper electricity. Grid investment is usually recovered through network charges, the regulated add-ons to bills that pay for wires, substations and system upgrades. Irish households know the pattern well: a 2026 decision added about €41 a year to bills to fund network investment (The Irish Times). Cyprus is trying to finance a much larger piece of infrastructure relative to the size of its electricity market, so the pressure on households is likely to be sharper.

The European Court of Auditors has warned that EU cross-border grid projects often run late even when the strategic case for them is strong (European Court of Auditors). GSI now has fresh momentum and a credible sponsor. What it does not yet have, at least in public, is the financing package that turns a strategic project into a buildable one.