This was the first in-depth study (Principal Investigator – Theodoros Zachariades) of the energy efficiency potential in Cyprus funded by the European Commission (Structural Reform Support Service) and the German Federal Ministry of Economy and Energy through the German Organisation for International Cooperation. Different energy models were combined in order to conduct simulations and provide recommendations to national authorities so that Cyprus can meet its targets in the frame of the EU energy and climate policies. The study assessed both the maximum theoretically available potential for energy efficiency improvements and the economically viable potential, and then translated these assessments to aggregate energy demand forecasts. The analysis shows that Cyprus cannot continue along a ‘business-as-usual’ path in improving the efficiency of its energy system if it is to achieve the EU decarbonisation goals for year 2030 and beyond.