Greece’s new CAT mechanism model compensating electricity generation flexibility, a bailout demand taken on by the government during the fourth review, will be uploaded to the EU’s official website either today or tomorrow and is then expected to be officially endorsed soon after.
According to energypress sources, the European Commission gave permission for the Greek plan’s publication a few days ago, once adjustments it had requested were made.
The European Commission is expected to officially approve the new CAT flexibility mechanism soon after it is published, sources informed.
Then, Greek authorities are expected to push ahead with procedures leading to the first auction. Though it is not yet clear how long this could take, environment ministry officials are confident the first CAT flexibility mechanism auction could be staged in July. Preliminary work needed to set up the auctions has already begun ahead of the plan’s anticipated approval in Brussels, the ministry officials noted.
The new CAT flexibility mechanism will operate transitionally until the implementation of the target model, expected towards the end of the first half next year.
Independent electricity producers are keen to see the new CAT flexibility mechanism up and running as its previous version expired in April, 2017. This has prompted financial issues at production units.
Hydropower facilities, natural gas-fueled power stations, as well as RES units will be eligible to take part in these auctions and be compensated for their short-term notice electricity supply to the grid. Compensation for RES units will be limited to output not remunerated through renewable energy support mechanisms.
Assuming no major changes have been made to the plan, the new CAT flexibility mechanism should offer compensation for 4,263 MW of annual output. Hydropower facilities are expected to be entitled to compensation for output totaling 750 MW, up from the previous model’s amount of 582 MW. Starting prices at the CAT flexibility mechanism descending-price auctions are expected to be set at 39,000 euros per MW, higher than 25,000 euros per MW originally planned.
The demand response mechanism (interruptability) – compensating major-scale consumers, such as industrial enterprises, when the TSO (IPTO) asks them to shift their energy usage (lower or stop consumption) during high-demand peak hours, so as to balance the electricity system needs – will not be incorporated into the new CAT flexibility mechanism.