Cyprus solar and BESS
Investment guide
Solar farms and battery storage
In Europe's sunniest climate
2025 / 2026 edition
Published by Lighthief Cyprus Ltd
www.solarfarms.cy
Contents
- 1. Executive summary
- 2. Cyprus solar market
- 3. Investment costs and pricing
- 4. Battery energy storage (BESS)
- 5. Market prices and arbitrage
- 6. Featured projects
- 7. Financing
- 8. Revenue and returns
- 9. Risks
- 10. Tax
- 11. Process and timeline
- 12. About Lighthief Cyprus
- 13. Contact and next steps
- 14. BESS long-term service agreement
- 15. Letter of intent
1. Executive summary
Cyprus is one of Europe’s strongest locations for solar parks and battery storage: high irradiation, a competitive electricity market, and returns that can be checked against operating parks. This guide uses figures from the Cyprus day-ahead market (DAM).
- 3,300+ sun hours a year — Among the highest solar irradiation in Europe
- 8–13% equity IRR — Returns based on how operating parks actually perform
- €190/MWh curtailment recovery — Charge curtailed solar at €0, discharge at the peak (€220/MWh × 86.32% RTE)
- Up to 70% bank financing — For solar + BESS projects
- EU regulatory framework — A stable, predictable setting for the investment
- €172,919–€262,837/year — BESS curtailment-recovery revenue (2.5–3.8 MWh/day discharged × €190 per MWh)
2. Cyprus solar market
2.1 Market fundamentals
Cyprus is well suited to solar generation:
3,300+
Annual sun hours
1,800+
kWh/m²/year irradiation
1,800
kWh/kWp fixed bifacial
20.5%
Capacity factor
2.2 Curtailment
Curtailment on operating Cyprus parks rose from 0% in 2021 to 45.8% in 2025. That changes the investment case. Battery storage (BESS) is what protects the return.
| Year | Production (MWh) | Curtailment % | Effect on returns |
|---|---|---|---|
| 2021 | 10,146 | 0% | Full revenue captured |
| 2022 | 9,897 | 3.5% | Minimal effect |
| 2023 | 8,861 | 13.4% | Revenue starts to fall |
| 2024 | 7,436 | 26.7% | Material effect |
| 2025 | 5,599 | 45.8% | BESS becomes essential |
2.3 Competitive electricity market
Cyprus opened its competitive electricity market on 1 October 2025, moving from regulated prices to a day-ahead market (DAM) run by TSOC. The market sits under Law N.130(I)/2021, with CERA as the regulator.
- Day-ahead market (DAM) with hourly price clearing
- Price cap: €500/MWh (often reached on evening peaks)
- 17 registered participants at launch
- EAC still dominates (86% of conventional generation)
- An isolated grid — no interconnection with other countries
3. Investment costs and pricing
3.1 Current market pricing (2025/26)
From completed transactions and Lighthief Cyprus project figures:
| Project type | Cost per MW | Description |
|---|---|---|
| EPC — fixed bifacial | €600,000 | Public turnkey PV EPC |
| EPC — 2P tracker | €780,000 | Public turnkey PV EPC |
| Turnkey PV + RTB + connection (fixed) | €1,200,000 | Excludes a 4-hour BESS |
| Turnkey PV + RTB + connection (tracker) | €1,380,000 | Excludes a 4-hour BESS |
3.2 Typical investment sizes
| Size | Total (fixed–tracker) | PV EPC | BESS 4h | RTB + connection | Year-1 cash yield |
|---|---|---|---|---|---|
| 1 MW + 4 MWh | €1,700,000 – €1,880,000 | €600,000 – €780,000 | €500,000 | €600,000 | 11.9–13.5% |
| 5 MW + 20 MWh | €8,500,000 – €9,400,000 | €3,000,000 – €3,900,000 | €2,500,000 | €3,000,000 | 12.7–14.2% |
| 10 MW + 40 MWh | €17,000,000 – €18,800,000 | €6,000,000 – €7,800,000 | €5,000,000 | €6,000,000 | 12.8–14.3% |
4. Battery energy storage (BESS)
Battery storage is what makes a Cyprus solar investment work in 2025/26. BESS opens three revenues: curtailment recovery, evening-peak arbitrage, and future grid services. Lighthief is the Cyprus distributor for a Tier-1 BESS manufacturer — a cell producer and PCS supplier with utility-scale plants in operation.
4.1 Tier-1 BESS specification
| Parameter | Specification |
|---|---|
| Round-trip efficiency | 86.32% AC-AC (full system, including cabling) |
| Cycle life | 6,000+ cycles at 100% DoD (80% SOH) |
| Container capacity | 5.015 MWh per 20HC container |
| Base warranty | 5 years, OEM |
| Extended warranty (LTSA) | 15 years (years 6–15 are paid) |
| Annual capacity loss | 2.5% per year |
| Daily cycles | 1 cycle/day (charge from solar, discharge at peak) |
4.2 BESS pricing
| System size | Capacity range | Price per MWh | Example total |
|---|---|---|---|
| Small | 1–2 MW / 4–8 MWh | €166,000/MWh | 4 MWh = €664,000 |
| Medium | 2.5–5 MW / 10–20 MWh | €121,000/MWh | 20 MWh = €2,420,000 |
| Large | 8–25 MW / 32–100 MWh | €111,000/MWh | 40 MWh = €4,440,000 |
| Utility | 25–100 MW / 100+ MWh | €108,000/MWh | 100 MWh = €10,800,000 |
4.3 BESS O&M (annual, per MWh)
| Service | Annual cost per MWh |
|---|---|
| BESS preventive and corrective maintenance | €1,158/MWh/year |
| PCS + MVS maintenance | €1,312/MWh/year |
| Availability guarantee (97%) | €2,202/MWh/year |
| Total O&M (with guarantee) | €4,672/MWh/year |
| Total O&M (without guarantee) | €2,470/MWh/year |
- Curtailment recovery (today): store curtailed solar at €0 and discharge at the €220/MWh peak — €190/MWh net. October 2026 midday (10:00–14:00) averages about €7/MWh. September 2026 midday was about €146/MWh.
- Future arbitrage: a €115/MWh peak-to-midday spread × 86.32% RTE, once the law allows it.
- Financing: solar + BESS can reach 70% debt (a solar-only project is capped at €500k/MW).
- Future grid services: frequency regulation and spinning reserve, when that market opens.
5. Market prices and arbitrage
The following figures are modelled on real Cyprus market patterns in TSOC day-ahead reports.
5.1 Market clearing prices
€206
Overall average MCP /MWh
€104
Midday (10–14) /MWh
€155
Solar hours (06–17)
€220
Peak evening (17–21)
€115
Peak–midday spread
5.2 Prices by time of day
| Period | Hours | Average MCP | What it means |
|---|---|---|---|
| Overall average | 00:00–23:00 | €206/MWh | 375 TSOC day-ahead days (1 Oct 2025 – 10 Oct 2026), 69,340 half-hourly prints |
| Midday solar peak | 10:00–14:00 | €104/MWh | Lowest prices — the seasonal window for charging BESS |
| Solar hours | 06:00–17:00 | €155/MWh | The longer solar generation window |
| Peak evening | 17:00–21:00 | €220/MWh | Highest demand — the window for discharging BESS |
| Peak–midday spread | — | €115/MWh | Curtailment-recovery value, own-PV time-shift, and Category C midday spread |
| Midday days with a zero price | — | 186 of 375 days | At least one midday print at €0 |
5.3 BESS revenue: own PV today, Category C grid buy on leftover cycles
Category B charges from own PV. When the operator orders a cut, the battery stores energy that would otherwise be lost (€0 to charge) and discharges at the evening peak (€220/MWh average). After 86.32% round-trip efficiency that is €190 per MWh discharged. Leftover cycles time-shift uncurtailed own production (forgo daytime DAM). Category C leftover cycles buy midday DAM; the €115/MWh peak-to-midday spread is that path, not Category B. October 2026 midday (10:00–14:00) averages about €7/MWh. September 2026 midday was about €146/MWh.
€0
Charge cost (curtailed)
€220
Peak discharge (17–21h)
€190
Revenue per MWh discharged
€172,919
Annual (2.5 MWh/day)
€262,837
Annual (3.8 MWh/day)
Category C leftover cycles (grid buy): Category C leftover cycles: day-ahead buy on a €115/MWh peak-to-midday spread. Category B cannot buy from the grid; it time-shifts own uncurtailed PV instead. Frequency regulation and spinning reserve would add further revenue.
6. Featured projects
Agios Theodoros solar park + BESS
Agios Theodoros, Larnaca District, Cyprus | Target COD 2027
2.64 MWp
Capacity
10.56 MWh
BESS
€2.00M
Equity sought
~16-20%
Leveraged IRR
- Integrated 10.56 MWh BESS — 4-hour duration (€127k/MWh ex VAT)
- 680W bifacial TopCon — 2,150 kWh/kWp specific yield
- BESS captures 65% of curtailed solar for evening-peak dispatch (3k MWh/year, indicative)
- Single operator: Lighthief EPC and long-term O&M
- Year-1 gross energy revenue ~€834k — the full derivation is in the Excel model
Anarita solar park — 10 MW, operational
Anarita, Paphos District | Energised and connected to the grid
10 MW
Capacity
40 MWh
BESS opportunity
€12.5M
Investment
14.5%
Current ROI
- Measured curtailment: 38% average, up to 67% at the peak
- 18 months of verified production data
- BESS opportunity: recover €600k+ a year of curtailed energy
- ROI from 14.5% to 18%+ with a 40 MWh BESS
- Tier-1 BESS integration, turnkey delivery
Further projects are available under NDA. Ask Lighthief Cyprus for the current portfolio.
7. Financing
7.1 Solar-only financing
Cyprus banks cap finance for a solar-only project at €500,000 per MW, because of conservative lending and curtailment.
- Interest rate: 4.5–5.0%
- Loan term: 12–15 years
- Maximum LTV: Varies by MW (€500k/MW cap)
- Example (5 MW, €7.5M): Maximum debt €2.5M, equity €5M (67%)
7.2 Solar + BESS financing
A project with BESS can carry more debt, because the revenue is broader and curtailment is partly recovered.
- Maximum LTV: 70% of total capex (solar + BESS)
- Interest rate: 4.5–5.0%
- Loan term: 15 years
- Example (5 MW + 20 MWh, €9.25M): Maximum debt €6.475M, equity €2.775M (30%)
7.3 Financing comparison
| Scenario | Investment | Equity required | Annual profit | Equity ROI |
|---|---|---|---|---|
| Solar only (cash) | €7,500,000 | €7,500,000 | €1,000,000 | 13.3% |
| Solar + BESS (cash) | €9,250,000 | €9,250,000 | €1,260,000 | 13.6% |
| Solar only (financed) | €7,500,000 | €5,000,000 | €535,000 | 10.7% |
| Solar + BESS (70% financed) | €9,250,000 | €2,775,000 | €560,000 | 20.2% |
8. Revenue and returns
8.1 Energy production
- Capacity factor: ~20.5% at 1,800 kWh/kWp (fixed bifacial)
- Annual yield: 1,800 kWh/kWp fixed bifacial; 2,200 kWh/kWp 2P tracker bifacial
- Degradation: 0.5% per year (Tier-1 panels)
- System availability: 99%
8.2 Revenue streams
Primary: energy sales
- PPA rates: €150–210/MWh
- Wholesale DAM average: €206/MWh
- Offtakers: EAC or private distributors
- Term: 20–25 years typically
BESS revenue
- Curtailment recovery (current): store curtailed solar (€0 cost), sell at €220/MWh peak — €190/MWh net
- Annual curtailment revenue: €172,919–€262,837/year (2.5–3.8 MWh/day discharged)
- Future arbitrage: €115/MWh peak–midday spread × 86.32% RTE — not yet legal
- Future: grid ancillary services (frequency regulation, spinning reserve)
8.3 Return expectations
8–11%
20-year IRR (100% equity)
7.6–8.7 yrs
Simple payback
12–14%
Year-1 cash yield
25 yrs
Project lifetime
9. Risks
Curtailment risk
Risk: The grid operator may curtail production during oversupply. The 2025 average is 45.8%.
Mitigation: BESS recovers 30–60% of curtailed energy. Cost: €108–166k/MWh for Tier-1 battery systems.
Regulatory and policy risk
Risk: Changes in feed-in tariffs, support mechanisms, or market rules.
Mitigation: Long-term PPAs, grandfathering provisions, EU framework stability, and CERA oversight.
Market price risk
Risk: DAM price volatility — prices range from €0 to €500/MWh.
Mitigation: Fixed PPAs for base revenue. BESS sells at peak prices regardless of when the energy was produced.
Performance risk
Risk: Energy yield below the projection.
Mitigation: Conservative projections, performance guarantees, Tier-1 equipment, and Lighthief O&M.
Equipment and O&M risk
Risk: Equipment failures and maintenance cost.
Mitigation: Tier-1 equipment with warranties, Cyprus-based O&M, spare parts, and LTSA cover.
10. Tax
10.1 Cyprus tax framework
| Tax | Rate | Notes |
|---|---|---|
| Corporate tax | 12.5% | Among the lowest in the EU |
| Withholding tax (dividends) | 0% | To non-Cyprus tax residents |
| Capital gains tax | Generally exempt | On securities and shares |
| Crypto gains | 8% flat | For moving from crypto into solar |
| VAT on equipment | 19% | Recoverable for registered entities |
10.2 Structures
- Cyprus holding company
- Partnership with EU investors
- Direct ownership using tax treaties (65+ double-tax treaties)
- IP Box regime for technology projects
Speak with a qualified tax adviser about your own case.
11. Process and timeline
Phase 1: Initial assessment
Weeks 1–2
- First meeting with the Lighthief Cyprus team
- Review of available projects
- First financial model in the ROI calculator
- Site visit, where it applies
Phase 2: Due diligence
Weeks 3–6
- Sign a non-disclosure agreement (NDA)
- Receive the due-diligence pack (technical data, projections, and legal documents)
- Independent technical review
- Legal review of permits, licences, the grid connection, and the PPA
Phase 3: Structuring and negotiation
Weeks 7–10
- Fix the investment structure (equity, debt, or hybrid)
- Bring in a bank, where financing is needed
- Agree the final terms and price
- Draft the share purchase agreement (SPA)
Phase 4: Signing and close
Weeks 11–14
- Sign the definitive agreements
- Complete registrations
- Transfer funds and close
- Hand over operations and put the O&M contract in place
12. About Lighthief Cyprus
Lighthief Cyprus Ltd
European–Asian renewable energy operator
Company
- Founded: 2015 (across Europe since 2017)
- Headquarters: Limassol, Cyprus / Częstochowa, Poland
- Team: 150+ professionals
- Countries: 11 (Poland, Cyprus, Greece, Italy, Spain, Germany, Netherlands, Kazakhstan, Uzbekistan, Romania, Ukraine)
- Assets under management: Hundreds of MW (solar, wind, biogas)
- Certifications: NATO certified, EU grants recipient
Services
- EPC: €600k/MW fixed · €780k/MW tracker
- O&M: 24/7 monitoring
- BESS integration: Tier-1 OEM systems
- Asset optimisation and performance
- Lifecycle support, including recycling
- Investment advice and letters of intent
13. Contact and next steps
What to do next
- Review current opportunities solarfarms.cy/projects
- Use the ROI calculator solarfarms.cy/calculator
- View live market data solarfarms.cy/market
- Generate a letter of intent solarfarms.cy/loi
- Book a meeting (details below)
Cyprus contact
Alexander Papacosta
Cyprus Director
+357 99 164 158
office@lighthief.com
Company
Lighthief Cyprus Ltd
15 Agaritsis, Nektaria Court, Office 201, 3045 Zakaki, Limassol
+357 77 77 00 50
office@lighthief.com
www.solarfarms.cy
Registration: HE 477423 | TIN: 60187188Q | Limassol, Cyprus
14. BESS long-term service agreement
Every BESS supplied by Lighthief Cyprus includes a long-term service agreement for monitoring, maintenance, and performance guarantees. The LTSA keeps the battery performing through its life.
14.1 Service tiers
| Tier | Name | Includes | Annual cost /MWh |
|---|---|---|---|
| A | Basic monitoring and maintenance | 24/7 remote monitoring, visits twice a year, quarterly reports | €1,158/MWh |
| B | Full O&M | Tier A, plus corrective maintenance, PCS/MVS servicing, and emergency response | €2,470/MWh |
| C | Full service and availability | Tier B, plus a 97% availability guarantee, local spare parts, and liquidated damages | €4,672/MWh |
| D | Premium and performance warranty | Tier C, plus a state-of-health guarantee, cell augmentation, and module replacement cover | Price on application |
14.2 Main LTSA terms
Monitoring and response
- 24/7/365 remote monitoring on the Lighthief platform
- Critical alerts: 4-hour response
- Preventive maintenance on site, twice a year
- Maintenance to the manufacturer’s manual
- Cyprus coastal protection (C5 enclosure maintenance)
Performance guarantees
- 97% annual availability guarantee (Tier C and above)
- State-of-health guarantee: 85% at year 5, 70% at year 15
- Liquidated damages if performance is below the guarantee
- Cell augmentation, where it applies
- Warranty reserve backed by the OEM
14.3 Optional warranty extensions
| Extension | Period | Cost /MWh/year |
|---|---|---|
| BESS performance and product warranty | Years 6–10 | €914/MWh/yr |
| BESS performance and product warranty | Years 11–15 | €4,182/MWh/yr |
| PCS + MVS product warranty | Years 6–10 | €748/MWh/yr |
| PCS product warranty | Years 11–15 | €1,086/MWh/yr |
14.4 State-of-health guarantee (not currently offered)
| End of year | Guaranteed SOH (1 cycle/day) | Guaranteed SOH (2 cycles/day) |
|---|---|---|
| Year 1 | 95% | 93% |
| Year 3 | 89% | 86% |
| Year 5 | 85% | 82% |
| Year 10 | 79.6% | 71% |
| Year 15 | 70% | Not applicable (10 years maximum at 2 cycles/day) |
14.5 How the agreement is set up
- Initial term: 5 years from the commissioning date
- Renewal: Further 1-year periods (90 days’ notice to end)
- Payment: Annual in advance, 30-day terms, CPI+2% each year
- Governing law: Republic of Cyprus
- Schedules: Site and equipment, service fees, maintenance checklist, availability calculation, degradation curve
15. Letter of intent
Fill in the form to generate a non-binding letter of intent. You can print and sign it, or send it digitally to start the process.
Investor
Project
Investment terms
BESS and LTSA
Print and sign: Opens the letter in a new window to print, sign, and return to office@lighthief.com
Send digitally: Sends the letter to Lighthief Cyprus and opens a copy for your records
© 2026 Lighthief Cyprus Ltd. All rights reserved.
This guide is information, not investment advice. Past performance does not indicate future results. Speak with your financial and legal advisers. Market figures come from TSOC day-ahead reports.