A persisting tariff level issue at DESFA, Greece’s natural gas grid operator, is one of the obstacles holding back the completion of its privatization. The government is aiming for a revised tariff formula that will avoid excessive costs for consumers, especially in sensitive areas such as the industrial sector, where changes influence production costs, and households, which rely on natural gas for basic energy needs. Network usage costs are particularly substantial for industry and gas-fueled power stations.

DESFA yesterday forwarded a proposal for new regulations as part of public consultation procedures staged by RAE, the Regulatory Authority for Energy. According to sources, the proposal would lead to tight limits and bigger penalties in the case of deviations, surplus gas amounts and imbalances. The issue has prompted objections from gas-fuled electricity producers and regional EPA gas supply companies, which argue that the Greek gas market is still at an embryonic stage that does not offer alternatives for players.

Although DESFA cited related EU regulations to which the operator must adjust as the basis for its proposal, market players would be left exposed to the measure’s penalties as a daily market into which possible surplus gas amounts could be channeled does not exist.

DESFA has pointed out that if users do not cover the costs created to the system by surplus natural gas amounts then usage fees will need to increase for all.