Renewable energy sources (RES) producers fear they may be hit by a new round of tariff cuts for their output following last week’s announcement by LAGIE, the Electricity Market Operator, forecasting a widened RES special account deficit to 190.64 million euros in 2016 from 82.68 million euros at the end of last year.
Sector authorities will need to seek solutions that may counter this unfavorable prospect, which has raised concerns, especially among wind-energy producers and the considerabe number of photovoltaic system investors.
Energy minister Panos Skourletis has ruled out any possibility of increasing a RES-supporting surcharge (ETMEAR) imposed on electricity bills. This surcharge makes up about half of the RES special account’s revenue. An enormous number of consumers are already struggling to meet electricity bill payments, as highlighted by the alarming level of unpaid overdue amounts owed to PPC, the main power utility.
LAGIE has largely attributed its forecast of a widened RES special account deficit to the fall in international prices for CO2 emission rights. The operator expects a 150 million-euro reduction from this source of revenue for the RES special account.
One possible solution already being considered is to increase the percentage withheld from CO2 emission rights for the RES special account.
According to energypress sources, RES sector authorities are looking at banks, electricity suppliers, and RES producers, in this order, for possible solutions.
Banks have provided financing for most wind-energy and PV sector investments. Loan interest rates, especially for PV investors, are considerably high, making the sustainability of investments extremely difficult. A reduction of interest rates could make available some savings for the RES special account.
Electricity suppliers, meaning PPC, primarily, want to avoid any revisions that could require them to cover part of the RES special account deficit.
The government wants to avoid further tariff cuts for RES producers following those included in the New Deal, established in an effort to resolve the RES sector’s financial woes. Even so, the prospect of tariff cuts cannot be ruled out until other solutions are found.