Saving at Home subsidy platform restarting following improvements

The Saving at Home subsidy program supporting energy efficiency upgrades of properties is set to be relaunched on January 25 after being suspended for two weeks to make technical improvements to its online platform accepting applications.

A severe imbalance in the processing of bids prompted the intervention.

Larger-scale professionals of the building industry, such as big civil engineering firms backed by specialized software, were able to achieve collective and swifter processing of their applications, blocking out, as a consequence, bids lodged by individuals or smaller professional firms.

Application deadlines for the remainder of regions around the country still not serviced have been deferred by two weeks.

Interested parties in the east Macedonia and Thrace region may lodge their subsidy applications as of January 25. The online platform opens for west Macedonia residents on January 27, property owners in central Macedonia can submit applications as of January 29, while interested parties in Thessaly can lodge bids as of February 1.

The category for apartment blocks opens February 3 for the entire country.

Prinos field threatened by poor results, decline projection

Operations at the Prinos field, Greece’s only producing oil field, in the country’s offshore north, are in great danger of being disrupted following poor production figures in 2020 and a further decline predicted for 2021, a wider company update just delivered by Energean Oil & Gas, the field’s license holder, has suggested.

In 2020, production at the oil field reached just 1,800 barrels per day, while its inferior-quality output was sold at a discount price, between 7 to 8 dollars below Brent levels.

This level of output represents less than 4 percent of Energean’s overall production, which, last year, reached 48,000 barrels – mostly natural gas.

Output at the Prinos field is projected to drop below 1,500 bpd in 2021 as, even if a rescue plan for the facility is approved, related investments needed at the facility will take time to complete.

The rescue plan, announced last June by Energean and dubbed Green Prinos, envisions an adjustment for eco-friendly operations through a series of investments worth 75 million euros.

Energean’s administration, in its company update to analysts, expressed hope that a solution can be found in the first quarter of 2021 for its rescue plan, submitted to the Greek government, which then forwarded the plan to the European Commission.

The rescue plan has remained stuck at the European Directorate for Competition, whose approval is required.

Energean is considering the development of a carbon capture and storage project at its Prinos field, which would be the first in Greece, promising new life for the project, along with the support of investments at field E, whose development depends on the outcome of a financing bid, company officials informed.

Overall, the news for the Prinos field is not good. Losses incurred by this unit since September, 2019, when its crisis began before being further aggravated by the pandemic, have exceeded 100 million euros.

This loss, however, has not affected the overall financial results of Energean, generating significant earnings in Egypt, primarily. Israel, too, could become a major source of earnings for the company as of next year.

RAE upper limit on balancing market offers still possible

A decision by RAE, the Regulatory Authority for Energy, on whether to intervene further following yesterday’s decisions to suspend negative prices for balancing energy market offers and limit them in accordance with minimum production levels that are technically possible will depend on how balancing market prices unfold, authority officials have pointed out.

The possibility of an upper limit for balancing energy market offers cannot be ruled out, the RAE officials explained.

Commenting on yesterday’s initiatives by RAE, electricity producers, on the one hand, and non-vertically integrated suppliers, traders and major-scale consumers, on the other, offered conflicting opinions.

The imposition of a zero-level threshold for offers was not necessary as extreme prices, or behavior, no longer exist in the balancing market to justify the measure, electricity producers contended, warning that it could prompt new market distortions.

The producers also expressed concern over RAE’s preference to not set a specific time period for the negative-price suspension’s validity.

At the other end, Antonis Kontoleon, the head official of EVIKEN, Greece’s Association of Industrial Energy Consumers, noted that RAE has taken a step back from its own proposal for an upper limit on balancing energy market offers as well as upper and lower limits for balancing capacity market offers.

Industrial energy consumers will remain dependent on whether balancing market participants exercise restraint, the EVIKEN chief underlined.

Suppliers and traders described the two RAE measures implemented yesterday as a first step in the right direction.

The impact of the measure limiting offers in accordance with minimum production levels that are technically possible cannot be quantified, they noted, adding the zero-level threshold measure will prevent sharp price rises but would prove insufficient if, for any reason, self-restraint stops being observed in the balancing market.

One trader noted that the zero-level threshold, to prove effective, must be maintained until power grid operator IPTO completes the “western corridor” grid in the Peloponnese.

Major gas distribution tariff cuts a boost for industry

EDA THESS premises in Thessaloniki were visited by the President of the Federation of Industries of Greece (SBE), Mr. Athanasios Savvakis where he was welcomed by the General Manager, Mr. Leonidas Bakouras and executives of the Company.

During the meeting, the General Manager informed about the approved Development Plan 2021-2025 amounting to ~ 156 million € which is already being implemented supporting the development of the areas of responsibility of EDA THESS. As part of this ambitious Program, the Company aims to integrate more and more industries in the gas distribution network. The expansion of natural gas use to energy-intensive production units leads to an increase in their energy efficiency, to a reduction in the energy cost while at the same time environmental performance is improved.

It is worth noting that in 2020, for the region of Thessaloniki the industries MEL SSA, MEVGAL SA, Souroti SA, Roka SA, Onassis SA, B. Maliouris SA and the new gas station using CNG of EKO SA in Thessaloniki signed a connection contract, while for Thessaly the companies HELLENIC DAIRIES SA, AGRODER IKE, VIOLAR SA, CVBTECH HELLAS MIK, D,KISSA BROS & CO OE.

At the same time, Mr. Bakouras pointed out that the critical decline of distribution tariffs derives from the development planning, consistent and full implementation of an integrated strategy with profitable investments, based on technical and economic criteria. From the 1st of January the weighted average distribution tariff of EDA THESS that has been approved by the Authority shows a further decline of 14.8% in Thessaloniki and 21.9% in Thessaly, compared to the previous regulatory period.

Even more impressive is the reduction for the industrial consumers, who now enjoy reduced distribution tariffs by 45% in Thessaloniki and 56% in Thessaly compared to the distribution tariff applied in the previous regulatory period.

For his part, Mr. Savvakis expressed his satisfaction for the shaping of distribution prices at lower levels. He stressed that such a development is quite positive for the productive base and acts as an accelerator in attracting new investments, turning the region into an investment hub. By this way, the interest of investors for the development of companies in the industrial sector is mobilized, as a healthier, more flexible, and competitive environment with low energy costs is established. In this direction, EDA THESS through targeted investments, further strengthens the perspective of infrastructure development both in Northern Greece and in other areas of its License.

In line with the National Plan for Energy and Climate objectives, EDA THESS achieves the increase of natural gas penetration, contributing to the boost of the productive restructuring.

Motor Oil launches west Balkan growth plan, under Shell brand, in Croatia

Petroleum retailer Coral, a member of the Motor Oil group, is eyeing west Balkan markets, troubled by gasoline and diesel quality and trading concerns, on the strength of the strong Shell brand name it represents.

The Motor Oil group acquired Shell Hellas in 2010 in a deal licensing the company to market the multinational’s brands. Motor Oil then renamed Shell Hellas as Coral and, approximately four years ago, founded companies in North Macedonia, Albania, Montenegro and Serbia.

Coral’s acquisition of a 75 percent stake in petroleum retailer Apios, holding a 3 percent share of the Croatian market and operating 26 petrol stations in the country, represents the beginning of the Greek firm’s growth plan for the west Balkan region, company officials said.

Croatia, this investment plan’s launch pad, is backed by robust economic projections. The country’s tourism industry has enjoyed solid growth over the past two years, generating increased revenues for petroleum firms.

Beyond Croatia, Coral plans to soon open two petrol stations in North Macedonia, under the Shell brand name. The company is also planning to enter the markets of Albania and Montenegro, where it also maintains the rights to use the Shell brand name.

Coral already operates five petrol stations in Serbia and is preparing to launch an additional six in this country.

 

Skrekas announces series of initiatives to tackle energy poverty

Environment and Energy Minister Kostas Skrekas on Wednesday announced a series of initiatives to tackle energy poverty, speaking at the 4th Conference of Electromobility of the Hellenic Association for Energy Economics, which is being held online.
He said that 70 billion euros will flow into the country in the next years, adding that one of the government’s top priorities is to help the Greeks who are unable to meet energy costs.
Skrekas said that the equation that must be solved is difficult, as it must combine a reduction of the environmental impact with competitive energy rates. He also underlined that tremendous changes in terms of energy consumption have already taken place, as lignite covered 45 percent of power production just 10 years ago and this has now dropped below 20 percent.
“The energy sector, apart from the major investments and the new jobs created, is the means for developing the other sectors of the economy,” he concluded.

Parliament approves bill for extending territorial waters to 12 nautical miles in the Ionian Sea

The Foreign Affairs Ministry’s bill for extending Greece’s territorial waters to 12 nautical miles in the Ionian Sea was ratified in parliament in a Wednesday evening vote, receiving absolute majority, as required by Article 27 of the constitution for legislative acts that effect a change in the borders of the state.

The bill received 284 votes of approval, favored by ruling party New Democracy, main opposition party SYRIZA-Progressive Alliance, Movement For Change (KINAL), Greek Solution and MeRA25. The Greek Communist Party declared itself ‘present’ in the proceedings, which does not count as a vote of rejection.

The full title of the bill is “Determination of the extent of the coastal zone in the Ionian Sea region and the Ionian Islands up to Cape Tainaro in the Peloponnese.”

Greece decided to exercise its right to extend its territorial waters in the Ionian Sea, as provided for by the United Nations Convention on the Law of the Sea, said government sources; the agreement is also known as the Montego Bay agreement, as it was signed there in 1982.

Suppliers target electromobility, smart home and city markets

Domestic energy suppliers, targeting the electromobility, smart home and smart city markets, are closely following rapid technological developments, internationally, company executives told an industry event, the 4th Ecomobility conference, held yesterday.

Elpedison, anticipating electromobility market growth, is offering related services for homes and businesses through its DriveGreen package, which includes electricity tariffs below night rates on a 24-hour basis and free-of-charge kilowatt hours every month for electric vehicle usage, the company’s chief executive, Nikos Zahariadis told the event.

A National Energy and Climate Plan projection on the auto market penetration of electric vehicles by 2030 is too ambitious as a result of high price tags on electric vehicles, lack of infrastructure and lofty taxes, Zahariadis noted. Revisions are needed if the NECP’s electromobility objective is to be achieved, he added.

Aristidis Grammatikopoulos, product development manager at energy supplier Fysiko Aerio, informed of the company’s participation in the development of recharging infrastructure. Fysiko Aerios has also prepared special packages and services for supply and installation of smart recharging units for domestic use, he added.

The Fysiko Aerio official also announced new smart-tech services, via mobile phone, offering customers optimal energy packages though an algorithm linked to individual energy consumption patterns.

Greek market data in 2020 show potential for the electromobility sector, despite difficulties, energy supplier NRG’s strategic manager Ilias Petris asserted.

The development of recharging infrastructure is the most pivotal factor for electromobility market growth, the NRG official stressed, adding that a current focus on the wider Athens area requires adjustment for a widespread approach.

The Motor Oil group, owner of NRG, has been a pioneer in electromobility through the installation of recharging networks along national highways as far back as two years ago, Petris noted.

 

Chinese firms barred from distribution operator sale

Conflict of interest, including in grid energy storage, a fast-growing market, has prompted power utility PPC to stop two Chinese firms interested in the prospective sale of a 49 percent stake in distribution network operator DEDDIE/HEDNO, a PPC subsidiary, from taking part.

State Grid Corporation of China (SGCC), a strategic partner of Greek power grid operator IPTO with a 24 percent stake, and another Chinese company, still undisclosed, both participated in a market test for the DEDDIE/HEDNO privatization, indicating an interest to submit bids.

A total of 19 firms reportedly expressed preliminary interest in the sale’s market test, conducted by the procedure’s consultants.

The DEDDIE/HEDNO partial privatization’s conditions include a term barring the participation of any firms directly or indirectly related to IPTO.

The conflict-of-interest term was included in the sale’s rules as electricity network companies, whether involved in high voltage, such as IPTO, or mid and low voltage, such as DEDDIE/HEDNO, are expected to find themselves competing in various electricity market services, including energy storage.

The grid energy storage market – offering large-scale storage systems that store electrical energy during times of abundance, low prices, or low demand before returning it to the grid when demand is high and electricity prices tend to be higher – is experiencing rapid growth on a global scale.

Greece still lacks a legal framework covering this domain. The energy ministry is working on this pending issue, crucial for the country’s effort to achieve National Energy and Climate Plan objectives through greater RES penetration.

This legal framework will, amongst other matters, determine market participation and remuneration terms for energy storage units, as well as related services to be traded on the energy exchange.

PPC anticipates first-round expressions of interest from four to six consortiums for the DEDDIE/HEDNO sale of a 49 percent stake.

 

EBRD: Green projects in Greece a priority, RES-based economic recovery

The European Bank for Reconstruction and Development (EBRD) is strongly interested in Greek energy market investments, Andreea Moraru, the bank’s head of Greece and Cyprus, has stressed in an interview with energypress.

The EBRD official spoke extensively on significant investment opportunities being created by the energy transition.

Since 2015, the EBRD has invested over four billion euros in Greece, participating in numerous major projects, Moraru informed, noting its recent support for power utility PPC, an investment worth 160 million euros, one of the bank’s largest, to cover customer payment volatility following the outbreak of the pandemic, exemplifies EBRD’s strong support for Greece.

The full interview follows:

What is the role of the EBRD compared to that of other banking institutions? 

The EBRD is a development bank committed to furthering progress towards ‘market-oriented economies and the promotion of private and entrepreneurial initiative. Our role is to be complementary to the commercial banks, to work alongside them and to support them.

Αdditionality is among the founding principles underlying our work and the particular support and contribution that the EBRD brings to an investment project which is not available from commercial sources of finance. Alongside transition and sound Banking, it is one of the three founding principles underlying our work. By ensuring that we are additional in everything we do, we ensure that our support for the private sector makes a contribution beyond that available on the market and does not crowd out other private sector actors.

Whenever we consider financing a project, we analyze whether similar financing can be obtained from private sector local banks or non-banking institutions.

Many of our markets are relatively high risk, and the private sector will only lend for short periods of time or at such high rates as to make the project unfeasible. For major new projects in the field of infrastructure, for example, longer-term financing may not be available on reasonable terms or conditions. This is where the EBRD fits in.

Additionality can also be non-financial in nature, where EBRD’s interventions contribute to better project outcomes that would not have been required or offered by commercial financiers. This can include the provision of comfort to clients and investors by mitigating non-financial risks, such as country, regulatory, project, economic cycle or political risks. Additionality may also be derived from the EBRD’s involvement in helping projects and clients achieve higher standards than would have been required by the market, such as through sharing its expertise on better corporate governance or above ‘business as usual’ environmental or inclusion standards.

Do you consider the energy sector in Greece to be suitable to contribute to the development and reconstruction of the Greek economy? For what reasons?

Absolutely. In general, the EBRD’s vision for the energy sector is of a partnership between industry, governments and consumers that delivers the essential energy needs of societies and economies in a manner that is sustainable, reliable and at the lowest possible cost.

In Greece the energy sector is embarking upon its biggest transformation yet, moving away from its reliance on lignite (c. 20% of total electricity production in 2019) to renewables and a smaller fleet of significantly less carbon intensive gas generating units. The NECP aims to achieve reduction in greenhouse gas (GHG) emissions by more than 55% by 2030 compared to 2005, planned to be achieved through: (i) decommissioning of all 4 GW of lignite-fired generation capacity by 2028 (3.4GW by 2023), (ii) 8.7 GW of new renewable generation capacity to added by 2030, reaching a total of 19 GW, and (iii) 2 GW of new gas generation capacity added for system support and security. The country remains committed to implementing the NECP as planned despite the negative impacts the CV19 crisis is expected to have on the Greek economy in 2020 and beyond.

Greece’s withdrawal from coal is a fundamental transformation that will create substantial sector and social challenges with the following broad implications: (1) constructing large volumes of low carbon generating capacity in order to ensure energy security in an increasing electrified economy, (2) reengineering the country’s transmission and distribution networks to reflect the additional penetration of distributed, intermittent renewable energy, and (3) addressing the social and economic impacts of the closure of a major part of its existing energy infrastructure, i.e. ensuring a just and inclusive transition.

We have supported many energy projects so far, especially renewables, working together with leading companies, such as GEK Terna, Mytilineos and HELPE among others.

A recent milestone is our support for the largest renewable energy project in Greece and the largest solar energy project in south-eastern Europe to date, the new solar park in Kozani. In 2017, we also approved a framework committing up to €300 million to finance renewable energy investments in the country.

The main reasons why this sector is important for the development of the Greek economy and thus our participation, is first to help the decarbonization of the country and the transition to a greener economy, as well as to strengthen local linkages and regional integration.

What is the EBRD’S philosophy about its presence in the Greek economy and especially in the energy sector?

In Greece in particular, supporting sustainable energy and infrastructure is among our top priorities. In fact supporting sustainable energy and infrastructure is one of the pillars of the newly approved country strategy. Our investment strategy in the energy sector going forward will aim at further liberalization and diversification of the energy market focusing on renewables and increased renewable energy capacity and a more diversified energy mix to promote decarbonization of the economy. EBRD could support a second phase of feasible renewable energy projects with project preparation / technical assistance and financing (biomass and biogas plants, use of waste heat in greenhouses for high value-added agriculture, electricity storage facilities, green hydrogen production plants and other forms of energy storage.

We see that it’s challenging to meet EU climate goals in Greece and our goal is to support the country with that. Our approach and philosophy is in line with the National Energy and Climate Plan and we are very glad the Greek government is committed to close all lignite plants. We need to keep this momentum, despite the current Covid-19 crisis, and turn the country greener.

One good example is our recent support for PPC (DEI). This has been one of our largest investments (€160 million) and the first time we supported the public sector in Greece. This facility supports PPC’s working capital needs at a time of customer payment volatility following the outbreak of the crisis. It also strengthens the resilience of the electricity sector as a whole by ensuring the stability of essential utility supplies and maintaining the momentum towards decarbonization.

What are the characteristics of private companies that could apply to be supported by the EBRD?

When we consider financing a project we analyze different aspects, such as how it supports the green economy, if it promotes women or youth inclusion, if it can enhance the competitiveness and resilience of the Greek economy etc. We look at the financial strength of the project as we operate according to sound banking principles. We cannot finance companies in certain sectors like defence-related activities, tobacco, substances banned by international law or gambling facilities.  As I have already mentioned, we also need to be additional.

We work in a wide range of sectors, from energy, infrastructure, manufacturing, property, tourism, agriculture to trade and financial institutions. We also support SMEs with business advice, know-how transfer and trainings.

What are your conclusions from your cooperation so far with Greek companies and institutions?

We’re very proud of all our projects in Greece so far. Since commencing our operations in 2015, the Bank has invested more than €4 billion in the country, helping respond to the financial crisis. Against a turbulent political and economic backdrop, the EBRD helped stabilize the financial sector, support private companies through export-oriented growth and lay the foundations for greater private sector participation in critical energy and infrastructure projects that have also strengthened regional integration.

We faced several challenges because of the financial crisis, but this was expected and was exactly the reason why we came to the country. Our main conclusion is that Greek companies have strong potential and very talented workforce, who we’re glad to be working with. The COVID-19 pandemic has abruptly interrupted Greece’s steady recovery, but we’re confident that the country can build back better.

We have an excellent cooperation with the Greek Government whom we are supporting on a number of initiatives.  In late 2020, the EBRD joined forces with the Ministry of Development and Investments of Greece to establish a new public-private partnership (PPP) preparation facility cooperation account, following a request from the Greek authorities. We are also working close with the Ministry of Finance on development of a capital market strategy, a project supported by DG Reform.

What are your plans for the new year?

We will focus on supporting the recovery of the Greek economy, by helping with the immediate needs of the Greek businesses because of coronavirus, as well as with their long-term growth plans. Green projects, including in the energy sector, will be our priority, but we’ll also be active in other sectors. We’ll continue supporting the banking sector, too.

Do you consider the investment risk in our country increased after the great economic crisis and in the light of the current crisis due to a pandemic?

The financial crisis had a strong impact on Greece, but we recognize that the Greek economy had started recovering and growing in the recent years. It’s true that COVID-19 containment measures are likely to depress economic output and cause particular disruption to the tourism industry, reversing the economic recovery and hindering investments in the near term, not only in Greece, but also in most countries. There are still many things that need to be improved in the country to attract more investors, but we don’t consider the investment risk much higher than it used to be. The Greek economy can recover after the pandemic.

 

Wholesale prices in Greece well over European average in 3Q

Wholesale electricity prices in Greece during the third quarter of 2020 were three times over the €16/MWh European average, based on the Nord Pool power exchange, a European Commission report covering European electricity markets for this period has shown.

The report also traces the market’s 3Q rebound following a heavy slump in the preceding quarter.

Average prices rebounded at a slower pace in southeast Europe, compared to other regions, before reaching pre-pandemic levels in September as a result of weak demand and high production of wind energy and hydropower facilities, according to the Brussels report.

The average price in the third quarter rose by 43 percent, against 2Q, to €43/MWh, and was 30 percent lower, annually.

European price shifts in August moved in coordination, while the price gap between Greece and the European average narrowed significantly in 3Q as a result of the use of lignite-fired units and weak demand.

This gap vanished in September as a result of stronger wind energy output, which exceeded one TWh for the first time. As a result, prices in the region were between €46 and €47/MWh in September.

As for energy-mix developments, lignite-based production in Greece experienced a decreased share, captured by natural gas-fueled output.

In southeast Europe, the lignite-based output share contracted to 29 percent in 3Q from 35 percent in the equivalent period a year earlier; the gas-fueled sector’s production share rose to 20 percent from 18 percent; and the RES sector’s share of the energy mix increased to 34 percent from 30 percent.

Household electricity tariffs in Greece averaged €16.54/MWh (not including taxes and surcharges), while the country’s average for industrial tariffs was €10.62/MWh, the report showed.

Greek-Italian market coupling boosts transaction efficiency

The Greek-Italian electricity market coupling of day-ahead markets, launched on December 15 as part of the target model, is living up to its expectations as a safety valve facilitating optimal electricity flow between countries.

The initiative, operating through a single price coupling algorithm, EUPHEMIA (Pan-European Hybrid Electricity Market Integration Algorithm), which calculates energy allocation, net positions and transboundary electricity prices, has run smoothly since its launch over a month ago.

Greek-Italian transboundary electricity transactions admittedly enjoyed a high level of maturity prior to the introduction of market coupling, courtesy of reliable price forecasts by participants for the Greek and Italian markets.

A grid interconnection, in the form of a 163-km, 400-kV voltage and 500-MW capacity subsea cable, has been in service since 2002.

However, the market-coupling initiative has taken the efficiency of these transboundary Greek-Italian electricity transactions to a higher level as auctions allocating grid interconnection capacities are no longer required.

Since the mid-December coupling of the Greek and Italian energy markets, electricity has constantly flowed from the market offering lower prices to the higher-priced market, proving this market system’s ability to utilize interconnections to their fullest.

Market coupling of the Greek and Bulgarian day-ahead markets is planned to follow, its launch scheduled for spring.

An increased number of interconnected electricity markets promises to give the Greek wholesale electricity market a regional role. However, transboundary grid interconnections will need to be upgraded if this is to be achieved.

Mediterranean Gas & Energy Week, key regional summit, starts tomorrow

Two of the Mediterranean’s most important summits, the 3rd Mediterranean Oil & Gas Summit and the 8th Balkans Petroleum, have merged for Mediterranean Gas & Energy Week, a major online oil & gas event, taking place take January 19 to 21.

Following the success of the Global E&P Summit and the regional Africa Upstream, Gas & LNG Summit, North Africa’s governments will be gathering again to meet with European and Balkans officials and IOCs at the Mediterranean Gas & Energy Week, organized by IN-VR, global leader in investment networking.

Key IOCs, investors and service providers will present their new opportunities and solutions, and network with attendees
online.

Top-ranked government officials from the region, including Greece, Montenegro, Malta and Albania, will present their licensing rounds, LNG mega-projects, and new midstream projects, together with the Mediterranean’s most-established investors and new players, including Shell, TAQA Arabia, Dana Gas and Enagas.

Also, over its three days, the event promises to be filled with networking opportunities and the latest upstream and midstream developments.

Participants will include:

● Vladan Dubljević, Director, Montenegro Hydrocarbon Administration
● Alexandra Sdoukou, Secretary General for Energy and Mineral Resources, Ministry of the Environment and Energy of Greece
● Adrian Bylyku, Executive Director, AKBN
● Dr Albert Caruana, Director General, Continental Shelf Department, Office of the Prime Minister, Malta
● Khaled Abu Bakr, Executive Chairman, TAQA Arabia
● Patrick Allman-Ward, CEO, Dana Gas
● Francisco de la Flor, Director of International Organizations, Enagas
● Morris J. Becker, Senior Exploration Geoscientist – Portfolio & New Business, Middle East and Africa, Shell
● Charles Ellinas, CEO, EC Cyprus Natural Hydrocarbons Company Ltd (eCNHC)

DEDDIE sale preliminary deadline near, China’s SGCC out of contention

Prominent US funds such as Blackrock and KKR, European funds, including Ardian, as well as distribution network operators, primarily from Europe’s south, and central Europe, are among 19 likely participants, to date, in power utility PPC’s sale of a 49 percent stake in subsidiary DEDDIE/HEDNO, the distribution network operator.

An approaching expression-of-interest deadline set by PPC expires on January 29. In the lead-up, some 70 possible investors have been approached by three consultants, Goldman Sachs, Eurobank and Grant Thornton, commissioned by the power utility for the DEDDIE/HEDNO sale.

State Grid Corporation of China (SGCC) cannot take part in the sale as its strategic partnership with Greek power grid operator IPTO, in which the Chinese company holds a 24 percent stake, would represent a breach of conflicting-interest rules.

SGCC recently made clear an interest to further develop its presence in the Greek electricity market by either increasing its IPTO stake or pursuing a share in DEDDIE.

DEPA appeal against ELFE on January 28, deferral possible

A January 28 date has been set for an appeal filed by gas supplier DEPA Commercial to challenge a 2019 ruling by an Athens Court of First Instance that vindicated an overcharging claim by ELFE (Hellenic Fertilizers and Chemicals), awarding the producer a compensation amount worth 61 million euros.

ELFE was seeking a compensation amount of 302 million euros, arguing DEPA – the gas utility from which DEPA Commercial later sprung forth as a new group entity – overcharged between 2010 and 2015 for supply to the producer’s facility in Kavala, northern Greece, by passing on the increased cost of DEPA’s oil-indexed contract with Gazprom.

Also in 2019, the Athens Court of First had concurrently delivered a separate verdict in favor of DEPA, vindicating the gas company for unpaid receivables owed by ELFE. The producer was ordered to pay a sum estimated between 59.5 and 60 million euros.

In response, ELFE, too, filed an appeal opposing this 2019 decision, the hearing’s date set for September, 2021, sources informed.

Legal sources explained that the two appeals could end up being heard concurrently in September, based on a decision that may emerge from the forthcoming appeal ten days from now. Combining appeal cases is commonly practiced by courts, the sources noted.

If so, the amount of time needed to resolve this legal dispute will be extended, which would impact privatization fund TAIPED’s scheduling of the DEPA Commercial privatization.

TAIPED has set a March deadline for binding offers. This deadline could end up being stretched beyond September.

Should DEPA Commercial’s appeal against ELFE ultimately fail, then other customers of the gas company, primarily electricity producers and industrial enterprises, could also seek compensation amounts for overcharging.

Some pundits have pointed out that electricity producers were probably able to pass on to their customers any cost increase resulting from DEPA’s oil-indexed contract with Gazprom. On the contrary, industries did not have such leeway.

Preliminary talks for 9th post-bailout review begin today

Power utility PPC’s lignite monopoly ordeal, the effort to ensure proper functioning of target model markets, the progress of privatization plans, and Greece’s decarbonization master plan for the lignite-dependent local economies of west Macedonia, in the country’s north, and Megalopoli, Peloponnese, are the key issues on the agenda of the ninth post-bailout review set to be conducted by the European Commission.

Preliminary review talks are scheduled to commence today between energy ministry officials and Brussels technocrats. These will be followed by higher-level talks involving technocrat chiefs and Greece’s newly appointed energy minister Kostas Skrekas.

Though his predecessors faced plenty of pressure, especially over PPC’s dominance, the new minister could be in for a hard time if pending energy-sector issues are not directly dealt with.

RAE, the Regulatory Authority for Energy, and power grid operator IPTO are still seeking solutions to tackle problems faced by the target model’s new markets. They got off to a problem-laden start in November, prompting a sharp rise in balancing market costs during the first few weeks.

As for energy-sector privatizations, the plan to offer a 49 percent stake in distribution network operator DEDDIE/HEDNO appears to be making sound progress and attracting strong interest, as exemplified by the participation of 19 participants in December’s market test.

On the contrary, the privatization plan for gas supplier DEPA Commercial could be destabilized by the company’s ongoing legal battle with ELFE (Hellenic Fertilizers and Chemicals) over an overcharging claim made by the latter. This battle could delay and affect the DEPA Commercial sale.

The Just Transition Plan for Greece’s decarbonization effort is now beginning to make some progress, but this unprecedented endeavor’s degree of complexity cannot be overlooked. Vast amounts of land controlled by PPC need to be repurposed, Brussels must approve investment incentives, and licensing matters need to be resolved, amongst other matters.

Balancing market costs subdued for second consecutive week

Balancing market costs remained subdued for a second consecutive week, the total cost of three uplift accounts, according to official data provided by power grid operator IPTO, registering 5.87 euros per MWh in the tenth week since the November 1 launch of the target model. Its introduction prompted sharp balancing cost increases in the first few weeks.

More specifically, the uplift 1 account reached €1.39 per MWh, uplift 2 was €0.79 per MWh, and uplift 3 registered €3.69 per MWh.

According to IPTO data on the three uplift accounts during the first ten weeks of the target model, their total cost was €8.37 per MWh in the first week, climbed to €15.68, €19.45 and €20.06 per MWh in the second, third and fourth weeks, respectively, before peaking at €43.37 per MWh in the fifth week. The uplift total then plunged to €8.08 per MWh in the sixth week, before eventually falling further to levels of €5.74 and €5.87 per MWh in the ninth and tenth weeks, respectively.

Day-ahead market prices have also been low over the past two weeks of subdued balancing market costs, meaning the overall cost in the wholesale market has dropped.

Low electricity demand as a result of the mild winter weather, so far; the lockdown measures, even if not absolute; more accurate electricity demand forecasts by power grid operator IPTO; as well as increased output by RES and hydropower units, have all been cited as factors in the reduced cost of wholesale electricity.

In addition, more rational offers by producers have also contributed to the normalization of balancing market prices.

Brussels forwards new PCI list, to be finalized late this year

The European Commission’s fifth PCI (Projects of Common Interest) list in the electricity and natural gas sectors, being forwarded for public consultation, features, for now, a number of project additions and removals, compared to the previous edition.

Market officials and state authorities will have the opportunity to offer their views and observations over the consultation procedure’s twelve-week period before the European Commission adopts a finalized version of the fifth PCI list towards the end of 2021, based on an existing Trans-European Networks for Energy (TEN-E) framework, focused on linking the energy infrastructure of EU countries.

PCI projects are entitled to EU funding support. Brussels authorities introduced selection criteria revisions in December, ascertaining, however, that the impact of all projects, especially on CO2 emissions, will be appraised when finalizing the PCI list’s fifth edition.

The provisional list includes a number of electricity and gas sector projects concerning Greece.

Electricity-sector projects involving Greece include: a Bulgarian-Greek grid interconnection, expected to be completed in 2023; an Egyptian-Greek-Libyan grid interconnection headed by Green Power 2020 and scheduled for delivery in 2025; as well as three Egypt-Greece interconnections, two of these featuring Kykladika Meltemia SA as project promoter and expected to be respectively completed in 2025 and 2028, and a third headed by Elica SA and scheduled for completion in 2028.

An energy storage project planned by Eunice for Ptolemaida, northern Greece, and scheduled for completion in 2022 is a new entry on the PCI list.

In the natural gas sector, the PCI list includes: the Alexandroupoli FSRU (2022); a subsea pipeline between Greece and Italy, known as the Poseidon Pipeline (2025); EastMed, a pipeline planned to carry natural gas from the east Mediterranean to European markets, via Crete (2025); a compressor station in Thessaloniki’s Nea Mesimvria area (2022); a metering and regulating station in Megalopoli, Peloponnese (2025); a compressor station in Abelia, in Greece’s mid-north (2023); a compressor station in Kipoi, northeastern Greece (2024); a pipeline link for the Alexandroupoli FSRU (2022); a TAP pipeline capacity increase (2025); and the development of an underground gas storage facility (UGS) in the almost depleted natural gas field of “South Kavala” in northern Greece (2023).

Operators disagree on Crete network responsibility shift

Power grid operator IPTO and distribution network operator DEDDIE are locked in a dispute over the point in time at which management responsibility of Crete’s small-scale grid interconnection, to reach the Peloponnese, should be transferred from DEDDIE, currently responsible for Crete’s network as the island is classified as a non-interconnected island, to IPTO.

DEDDIE contends that IPTO must take on the responsibility of managing the island’s network with the launch of the small-scale interconnection, anticipated in March, and not in 2023, when Crete’s full-scale interconnection, all the way to Athens, is expected to begin operating.

Crete should be considered an interconnected island as soon as the small-scale grid interconnection to the Peloponnese is launched, even though this infrastructure’s capacity will be able to cover about 30 percent of the island’s energy needs, DEDDIE contends.

Normally, the grid status of islands is automatically revised from non-interconnected to interconnected when grid interconnections serving their energy needs are launched. However, Crete, Greece’s biggest and most populous island, represents a much bigger interconnection project that is being developed over two stages.

DEDDIE, backing its case, has cited an older opinion forwarded by RAE, the Regulatory Authority for Energy, to the energy ministry, through which the authority supported that Crete’s network must be considered a part of the national grid, ending its non-interconnected island status, once the small-scale interconnection begins operating.

Also citing technical reasons to support its view, DEDDIE has pointed out that IPTO will be responsible for the operation and maintenance of the small-scale grid link, infrastructure directly influencing the Cretan network’s performance. Therefore, the island’s high-voltage network and the Crete-Peloponnese interconnection must be managed by the one operator, DEDDIE contends.

IPTO does not reject the prospect of eventually becoming responsible for Crete’s network, but the power grid operator does oppose the idea of assuming responsibility for a fixed asset that does not belong to the company. Crete’s high-voltage network is owned by power utility PPC.

At present, PPC does not appear ready to sell. As a result, IPTO believes DEDDIE must be responsible for the network’s management until this asset is transferred to the power grid operator.

Energean plc takes Final Investment Decision on Karish North development

Energean plc has taken Final Investment Decision (FID) on the Karish North gas development, offshore Israel, 21-months after the announcement of the discovery, the company has announced in a statement.

In November 2020, DeGolyer and MacNaughton issued an independent Competent Persons Report that, inter alia, certified 2P reserves of 32 Bcm of gas plus 34 million barrels of liquids
(approximately 241 million barrels of oil equivalent in aggregate) in Karish North as at 30 June 2020.

The discovery will be commercialised via a low-cost tie-back to the Energean Power FPSO, which will be just 5.4km away.

Production from the first well at Karish North is expected to be up
to 300 mmscf/d (approximately 3 Bcm/yr) and first production is expected during 2H 2023.

Initial capital expenditure in the project is expected to be approximately $150 million, or $0.6/boe; and Energean estimates that the project will deliver IRRs in excess of 40%.

On 13 January 2020, Energean signed an 18-month, $700 million term loan facility agreement with J.P. Morgan AG and Morgan Stanley Senior Funding, Inc., the primary uses of
which will be:

• Accelerating the development of Karish North, enabling the capital expenditure on the project to be undertaken in advance of first gas from Karish Main. Following first gas from Karish North, the overall Karish project well stock will be able to produce well in excess of
the full 8 Bcm/yr capacity of the FPSO, retaining operational redundancy in the well stock therefore further enhancing overall project reliability.

• Funding the $175 million up-front consideration for the acquisition of the minority interest in Energean Israel Limited, as announced on 30 December 2020, which becomes payable on transaction close, expected 1Q 2021. Energean views the acquisition, for between $380 million and $405 million in total, as highly value-accretive, with very attractive transaction metrics.

Additional uses of the loan are:

• Funding approximately $100 million of capital expenditure required to install the second oil train and second riser on the Energean Power FPSO, which will increase the Energean Power FPSO liquids production capacity to approximately 40 kbopd ( from 21 kbopd) and allow maximum gas production of 800 mmscf/d (approximately 8 Bcm/yr, from 6.5 Bcm/yr). Both the oil train and the second riser are expected to become operational during 2022.

• The 2022 offshore Israel exploration and appraisal drilling programme in early 2022, with up to five wells including:

  • Appraisal of the potential oil rim that was identified as part of the Karish development drilling campaign plus exploration of further prospective gas and liquids volumes within the Karish lease.
  • Block 12, which is located between the Karish and Tanin leases, and is estimated to contain gross prospective recoverable resources in excess of 108 Bcm (3.8 Tcf)
    according to the D&M CPR, with the primary targets having geological chances of success ranging between 63% and 79%. The first well is expected to target the 20
    Bcm (0.7 Tcf) Athena prospect, for which the primary target (11 Bcm /0.4 Tcf) has a 70% geological chance of success. Success at Athena would significantly de-risk
    the remaining 88 Bcm (3.1 Tcf) of prospective resources in the block. Any discovery in that block would be prioritised over the development of Tanin due to (i) lower capital expenditure investment (as compared to Tanin) and (ii) the absence of any seller royalties, unlike the Karish and Tanin leases as Block 12 was not part of the original Karish-Tanin acquisition.
  • Additional prospects assessed to contain 102 Bcm (3.6 Tcf) of gross recoverable prospective resources, based on management estimates, in Energean Israel’s remaining exploration blocks.
    • Whilst total pre-production capex guidance for the Karish Main project remains at $1.7 billion plus the $140 million of deferred payments to TechnipFMC, the balance of the Loan will provide further financial flexibility for Energean Israel Limited.
    The Loan will only be drawn to the extent necessitated and drawn amounts will attract a margin of 5.75%, which steps up by 0.25% every three months, with a maximum of 7.00%. The Loan has been sized to cover the cost of associated fees and interest. Energean maintains its target to retain its medium-term net debt / EBITDAX ratio below 2.0x                                                                                                                                                    On 13 January 2021, Energean also agreed with the existing lenders of its $1.45 billion project finance facility to extend the maturity by nine months, from December 2021 to September 2022.
    Combined with the above Loan, the extension to the maturity date of the project finance facility provides Energean the necessary time and flexibility to optimise its long-term capital structure.
    This is expected to take place in 2021, depending on market conditions.                                                                                                                                                                                                    Mathios Rigas, CEO of Energean, commented: “I am delighted that we have taken Final Investment on Karish North, proving the value of the Energean Power FPSO as a quick and low-cost commercialisation route for our assets in Israel.
    We are also increasing the liquid processing capacity of our FPSO to process the additional volumes we discovered for minimal incremental cost.
    The new term loan and the extension of our project finance facility are a further testament of the confidence of the financial markets in Energean and I want to thank all the institutions for their support. We remain committed to optimising our capital structure to ensure that we maximise total shareholder returns whilst implementing our growth ambitions in Israel and the East Med. We remain on track to achieve our goal of delivering meaningful free cash flows that will support the payment of a sustainable dividend whilst also moving towards our stated target to achieve
    net zero emissions.”

EBRD reports close to €800 million investment in Greece in 2020

The European Bank for Reconstruction and Development (EBRD) stepped up its investments in Greece in 2020 to address immediate needs caused by the coronavirus pandemic and to create the foundations for a recovery with a focus on building back better economies.

Continuing its support for the Greek economy in 2020, the Bank made €797 million new investments in 17 projects, compared to €571 million in 13 projects in 2019, putting Greece in the EBRD’s top five countries of investment last year. 

Andreea Moraru, EBRD Director for Greece, said: “We are very proud to contribute to the robust response of the Greek economy to the crisis, supporting the recovery, helping local businesses with their needs and facilitating the transition to greener economic activities.” 

The Bank provided a senior unsecured loan of up to €160 million power utility PPC. The facility will support PPC’s working capital needs at a time of customer payment volatility following the outbreak of the crisis. It will also strengthen the resilience of the electricity sector as a whole by ensuring the stability of essential utility supplies and maintaining the momentum towards decarbonization. 

The EBRD also stepped up its efforts to help the Greek private sector by investing €57.5 euros in GEK TERNA’s successful issuance of a seven-year €500 million bond. GEK TERNA S.A. is the holding company for a group active in concessions, renewable energy, thermal energy and construction, incorporated in Greece. 

This issuance was the largest bond transaction to be listed to date on the Athens Stock Exchange and the first corporate issuance in the country since the outbreak of the pandemic. The proceeds will be used to refinance secured commercial loans with longer tenors and reduced financing costs, enabling a corporate transformation that will optimize the capital structure of GEK TERNA. 

Facilitating the transition from fossil fuels to renewable sources of energy, EBRD launched its just transition initiative linking the transition to a low-carbon economy with inclusive economic development. One of the first projects under this approach was the Bank’s €75 million investment in the successful Eurobond tap issuance by Hellenic Petroleum (ELPE), in support of a new solar photovoltaic plant in Greece, the largest solar energy project in south-eastern Europe to date. 

The total funds of €100 million raised will enable ELPE to finance the construction of 18 solar photovoltaic (PV) plants with a total installed capacity of 204 MW in Kozani, western Macedonia, the country’s most coal-dependent region. The solar park will be built close to existing coal-fired power plants that are being phased out and is expected to reduce CO2 emissions by 320,000 tons annually.

In addition, the EBRD invested €50 million in the first senior preferred (SP) green bond issuance by the National Bank of Greece (NBG), combining support for capital market development and for the green economy in Greece. It was the first green bond issuance by a Greek bank and the first SP instrument to be issued by a Greek financial institution. 

Together with other investors, the EBRD invested in a €186.4 million securitization transaction of automotive leases, originated by Olympic Commercial and Tourist Enterprises S.A. (Avis), the leading car leasing company in Greece and master franchisee of the global car rental company Avis Budget Group.  

The transaction was an important milestone for the Greek securitization market as it was the largest issuance by a non-bank originator and the first auto lease asset-backed security transaction in the country with a sustainable and green element. 

Part of the proceeds will be used by Avis for the replacement of its existing fleet with lower CO2 emissions, electric and hybrid vehicles, helping the company to reduce its diesel footprint.

In late 2020, the EBRD joined forces with the Ministry of Development and Investments of Greece to establish a new public-private partnership (PPP) preparation facility cooperation account, following a request from the Greek authorities. 

The EBRD will manage the facility, which will provide high-quality, client-oriented project preparation, training and advisory services, policy support and institutional strengthening activities related to the infrastructure sector in Greece. The Ministry will fund the activities of the facility with €20 million. The project pipeline will mostly be in the social infrastructure sector (education and health), sustainable urban infrastructure, and water and waste management.

Keeping vital trade flows going, the Bank provided a €20 million factoring facility to ABC Factors under its Trade Facilitation Program (TTP). Building on the EBRD’s cooperation with Alpha Bank, the parent company of ABC Factors, the facility will enable the factoring subsidiary to further expand its portfolio of small and medium-sized enterprises (SMEs) and local corporate clients by providing funding for domestic and international factoring transactions. Greece remains the EBRD’s most active country under TFP, with close to €320 million trade transactions in 2020.  

In 2020, the EBRD started 41 new advisory projects with Greek SMEs in various areas, such as strategic and business planning, marketing and e-commerce, operational efficiency, financial management and digitalization, and delivered five online export training seminars to more than 100 participants. Donor funding from Greece, as well as from the European Union through the European Investment Advisory Hub of the European Investment Bank, has been crucial. 

Papoutsanis, a leading Greek manufacturer of soap and liquid cosmetics, became the first Greek firm to join the EBRD’s Blue Ribbon program, which combines business advice and finance for companies that stand out for their market leadership and high-growth potential. 

Furthermore, the Board of Directors of the EBRD approved a new strategy for Greece, which will guide the bank’s investment and policy engagement in the country during the next five years. 

The EBRD responded to the coronavirus pandemic with record investment of €11 billion in 2020 through 410 projects. This represents a 10 per cent increase in annual business investment relative to 2019, when the bank provided €10.1 billion to finance 452 projects.

DEPA calls for RAE to prioritize Kipoi, Abelia compressor stations

Gas utility DEPA has underlined the gas-supply security importance of two prospective compressor stations in Kipoi, northeastern Greece, and Abelia, in the mid-north, urging RAE, the Regulatory Authority for Energy, to prioritize their development.

The two projects, on a RAE list of infrastructure projects for preventive action, are expected to significantly improve energy supply security in Greece over the mid and long-term by facilitating the transportation process of natural gas.

DEPA stressed the importance of the two compressor stations in a letter forwarded to RAE’s public consultation procedure on its preventive action plan.

The two compressor stations are vital for grid-connection and gas-flow purposes concerning the prospective Alexandroupoli FSRU and an underground gas storage facility (UGS) planned for development at an almost depleted offshore natural gas field in South Kavala, DEPA pointed out in its letter.

Also, the Abelia compressor station is needed to ensure hydraulic gas-flow sufficiency from north to south, via the TAP project, DEPA noted.

Both compressor station projects feature in gas grid operator DESFA’s ten-year development plan covering 2021 to 2030.

EBRD reports close to €800 million investment in Greece in 2020

The European Bank for Reconstruction and Development (EBRD) stepped up its investments in Greece in 2020 to address immediate needs caused by the coronavirus pandemic and to create the foundations for a recovery with a focus on building back better economies.

Continuing its support for the Greek economy in 2020, the Bank made €797 million new investments in 17 projects, compared to €571 million in 13 projects in 2019, putting Greece in the EBRD’s top five countries of investment last year.

Andreea Moraru, EBRD Director for Greece, said: “We are very proud to contribute to the robust response of the Greek economy to the crisis, supporting the recovery, helping local businesses with their needs and facilitating the transition to greener economic activities.”

The Bank provided a senior unsecured loan of up to €160 million to Public Power Corporation S.A. (PPC). The facility will support PPC’s working capital needs at a time of customer payment volatility following the outbreak of the crisis. It will also strengthen the resilience of the electricity sector as a whole by ensuring the stability of essential utility supplies and maintaining the momentum towards decarbonisation.

The EBRD also stepped up its efforts to help the Greek private sector by investing €57.5 million in GEK TERNA’s successful issuance of a seven-year €500 million bond. GEK TERNA S.A. is the holding company for a group active in concessions, renewable energy, thermal energy and construction, incorporated in Greece.

This issuance was the largest bond transaction to be listed to date on the Athens Stock Exchange and the first corporate issuance in the country since the outbreak of the pandemic. The proceeds will be used to refinance secured commercial loans with longer tenors and reduced financing costs, enabling a corporate transformation that will optimise the capital structure of GEK TERNA.

Facilitating the transition from fossil fuels to renewable sources of energy, the Bank launched its just transition initiative linking the transition to a low-carbon economy with inclusive economic development. One of the first projects under this approach was the Bank’s €75 million investment in the successful Eurobond tap issuance by Hellenic Petroleum (HELPE), in support of a new solar photovoltaic plant in Greece, the largest solar energy project in south-eastern Europe to date.

The total funds of €100 million raised will enable HELPE to finance the construction of 18 solar photovoltaic (PV) plants with a total installed capacity of 204 MW in Kozani, Western Macedonia, the country’s most coal-dependent region. The solar park will be built close to existing coal-fired power plants that are being phased out and is expected to reduce CO2 emissions by 320,000 tonnes annually.

In addition, the EBRD invested €50 million in the first senior preferred (SP) green bond issuance by the National Bank of Greece (NBG), combining support for capital market development and for the green economy in Greece. It was the first green bond issuance by a Greek bank and the first SP instrument to be issued by a Greek financial institution.

Together with other investors, the EBRD invested in a €186.4 million securitisation transaction of automotive leases, originated by Olympic Commercial and Tourist Enterprises S.A. (Avis), the leading car leasing company in Greece and master franchisee of the global car rental company Avis Budget Group.

The transaction was an important milestone for the Greek securitisation market as it was the largest issuance by a non-bank originator and the first auto lease asset-backed security transaction in the country with a sustainable and green element.

Part of the proceeds will be used by Avis for the replacement of its existing fleet with lower CO2 emissions, electric and hybrid vehicles, helping the company to reduce its diesel footprint.

In late 2020, the EBRD joined forces with the Ministry of Development and Investments of Greece to establish a new public-private partnership (PPP) preparation facility cooperation account, following a request from the Greek authorities.

The EBRD will manage the facility, which will provide high-quality, client-oriented project preparation, training and advisory services, policy support and institutional strengthening activities related to the infrastructure sector in Greece. The Ministry will fund the activities of the facility with €20 million. The project pipeline will mostly be in the social infrastructure sector (education and health), sustainable urban infrastructure, and water and waste management.

Keeping vital trade flows going, the Bank provided a €20 million factoring facility to ABC Factors under its Trade Facilitation Programme (TFP). Building on the EBRD’s cooperation with Alpha Bank, the parent company of ABC Factors, the facility will enable the factoring subsidiary to further expand its portfolio of small and medium-sized enterprises (SMEs) and local corporate clients by providing funding for domestic and international factoring transactions. Greece remains the EBRD’s most active country under TFP, with close to €320 million trade transactions in 2020.

In 2020, the EBRD started 41 new advisory projects with Greek SMEs in various areas, such as strategic and business planning, marketing and e-commerce, operational efficiency, financial management and digitalisation, and delivered five online export training seminars to more than 100 participants. Donor funding from Greece, as well as from the European Union through the European Investment Advisory Hub of the European Investment Bank, has been crucial.

Papoutsanis, a leading Greek manufacturer of soap and liquid cosmetics, became the first Greek firm to join the EBRD’s Blue Ribbon programme, which combines business advice and finance for companies that stand out for their market leadership and high-growth potential.

Furthermore, the Board of Directors of the EBRD approved a new strategy for Greece, which will guide the Bank’s investment and policy engagement in the country during the next five years.

The EBRD responded to the coronavirus pandemic with record investment of €11 billion in 2020 through 410 projects. This represents a 10 per cent increase in annual business investment relative to 2019, when the Bank provided €10.1 billion to finance 452 projects.

Brussels RES tool to promote member-state collaboration

A financing mechanism adopted by the European Commission to financially support new RES projects and facilitate synergies, at financial and technical levels, between EU member states is moving closer to actualization.

Late in 2020, the European Commission established a related platform and invited EU member states to express interest in the mechanism either as hosts or contributors.

According to the mechanism’s plan, contributing member states will be able to invest in RES projects in other countries. This prospect will enable contributors to become involved in projects offering greater financial returns, compared to those of domestic projects, and also invest through RES technologies that cannot be implemented at home. For example, landlocked countries will be able to invest in offshore wind farms and countries with minimal sunshine will be able to invest in solar farms.

On the other hand, member states hosting projects linked to the new mechanism stand to benefit from improved energy supply and security, grid upgrades, investments and job creation.

Also, RES output generated by projects linked to the new mechanism is planned to be equally divided by participating states, contributing to their respective energy and climate targets.

The European Commission is currently examining the prospect of also opening up this initiative to private-sector firms. Brussels, gauging the level of investment interest, has invited private-sector companies to express their interest in the mechanism by February 15.

The private sector is playing a crucial role in successfully promoting RES projects in the EU, Brussels pointed out in a statement.

South Kavala UGS tender qualifiers by early February

Greece’s privatization fund TAIPED will finalize its list of second-round qualifiers in a tender offering development and operation of an underground gas storage facility (UGS) in the almost depleted natural gas field of “South Kavala” in northern Greece by late January or early February, sources have informed.

Three parties submitted first-round expressions of interest: China Machinery Engineering Co. Ltd. (CMEC) – Maison Group; DESFA – GEK Terna; and Energean Oil & Gas (in alphabetical order).

Assessments of their supporting documents and other criteria are expected to be completed within the next twenty days.

RAE, the Regulatory Authority for Energy, still needs to deliver decisions concerning the operating framework of the UGS.

These pending issues include a RAE decision on the percentage of the UGS project’s capacity to be regulated, thus pre-determining this proportion’s revenue, and the earnings percentage to be determined by market forces.

The authority also needs to decide on the duration of the regulatory period and its WACC level.

North Macedonia involvement in key Alexandroupoli projects

North Macedonia plans to help cover its energy needs through an involvement in two Greek-based projects, the prospective FSRU in Alexandroupoli, northeastern Greece, and, in the same region, a gas-fueled power station to run on LNG stemming from the floating LNG terminal.

Much progress has been made on the neighboring country’s interest in these two projects since a meeting in Athens last September between Greek Prime Minister Kyriakos Mitsotakis and his North Macedonian counterpart Zoran Zaev. The partnership also represents a strategic decision for the Greek government.

It is considered certain that a state-owned North Macedonian company will soon enter the Alexandroupoli FSRU project’s equity pool with a 10 percent stake, energypress sources have informed.

This project’s five current partners – Copelouzos group, Gaslog, Greek gas utility DEPA, Greek gas grid operator DESFA and Bulgartransgaz – are expected to each offer small portions of their respective 20 percent stakes to make available a 10 percent stake for the state-owned North Macedonian company in the Alexandroupoli FSRU.

The project’s development is not expected to be impacted by any equity reshuffles.

Two international tenders staged by Gastrade, a company established by the Copelouzos group for the development and operation of the Alexandroupoli FSRU, have been successfully completed. One of the two tender concerns the FSRU’s construction. The other concerns the installation of pipelines linking this facility to the national gas grid.

The Alexandroupoli FSRU consortium is expected to make a final investment decision in late February, sources informed.

On the other front, ESM, North Macedonia’s state electricity company, is expected to acquire a 25 percent stake in a gas-fueled power station to be developed by Damco Energy, a Copelouzos group subsidiary, in Alexandroupoli’s industrial zone.

The initiative will secure 200 MW of the facility’s 800-MW capacity for North Macedonia. The country currently has an electricity deficit of approximately 2 GWh.

Bulgarian state-owned electricity company NEK EAD also appears interested in acquiring a stake in the Alexandroupoli power station. Bulgaria has projected an electricity deficit a few years from now as the country must phase out major lignite-fired power stations. European Commission exemptions extending the lifespans of these units are expiring.

Tenaris, Edison, Snam unite for hydrogen-based steelmaking project

Tenaris, Edison and Snam have signed a letter of intent to launch a project aimed at decarbonizing Tenaris’s seamless pipe mill in Dalmine, northern Italy, through the introduction of green hydrogen in some production processes, the companies have announced.

The project, which is part of a broader initiative known as “Dalmine Zero Emissions”, promises to launch the first industrial-scale application of hydrogen in Italy to decarbonize the steel sector.

Tenaris, Edison and Snam will collaborate to identify and implement the most suitable solutions for the production, distribution and use of green hydrogen at the Tenaris mill, contributing their skills to invest in the best available technologies.

The project looks to generate hydrogen and oxygen through an approximate 20 MW electrolyzer that will be installed at the Dalmine plant and to adapt the steelmaking process to use green hydrogen instead of natural gas.

The initiative may also include the construction of a storage site for the accumulation of high-pressure hydrogen and the use of oxygen, locally produced through electrolysis, within the melting process. The development of the project would significantly reduce CO2 emissions related to electric arc furnace steel.

After the initial test, the three companies will evaluate whether to expand the collaboration to other stages of the production process, therefore extending the use of hydrogen.

The broader “Dalmine Zero Emissions” initiative was launched by Tenaris together with Tenova and Techint Engineering & Construction to integrate green hydrogen in steelmaking from the electric arc furnace steel and in the downstream processing of the Dalmine mill.

Michele Della Briotta, President of Tenaris Europe and CEO of TenarisDalmine, noted: “The ‘Dalmine Zero Emissions’ project is our latest initiative launched by Tenaris in Italy to improve our environmental footprint, after the investments and projects for the protection of air quality, for energy efficiency, for the reduction of raw materials consumption, for the increase of the content of recycled material in our products and for the enhancement and reuse of our by-products. Through the ‘Dalmine Zero Emissions’ project’, together with qualified partners, we are starting the energy transition of the Dalmine plant, placing ourselves at the forefront of sustainability in the steel sector.”

Nicola Monti, CEO of Edison, commented: “With this agreement, Edison launches a path to support the decarbonization of industrial sectors that are key to the national economy, thus contributing to the achievement of the energy transition objectives set at a national level in the PNIEC and at a European level in the Green Deal. The renewable energy produced by our plants and the technological solutions available to us can concretely contribute to the development of a new and important national value chain, which in the coming decades will accompany the evolution of the economic and production system towards climate neutrality.”

Marco Alverà, CEO of Snam, remarked: “Green hydrogen can represent the ideal solution to decarbonize some key industrial sectors, in particular to produce zero-emission steel in the long term. Today’s agreement, which features three companies active along the entire value chain, is a first step to achieving this important goal. Thanks to its technologies and infrastructure, Snam acts as one of the enablers of the hydrogen supply chain, to contribute to the fight against climate change and the creation of new development opportunities, in line with national and European strategies.”

The implementation of the project will be governed by separate agreements negotiated between the parties in compliance with the legal and regulatory framework.

Greece, Turkey agree to resume exploratory talks on January 25 in Istanbul

The 61st round of exploratory talks between Greece and Turkey will take place in Istanbul on January 25, the Greek Foreign Affairs Ministry announced on Monday, in a brief statement.

According to diplomatic sources, the Turkish side contacted the Greek one and proposed that the 61st round take place at the above date and place.

The Greek side has accepted the invitation, they added.