Cretan energy alert the focus, new IPTO-Euroasia meeting

The energy ministry and RAE, Greece’s Regulatory Authority for Energy, are currently focused on delivering measures to counter Crete’s energy sufficiency alert between 2020 and 2022, when the island’s major-scale electricity grid interconnection with Athens is planned to be developed.

At the same time, the power grid operator IPTO and the Euroasia Interconnector consortium – responsible for the wider Euroasia Interconnector, a PCI-status project planned to link the Greek, Cypriot and Israeli power grids via Crete – will make yet another attempt to reach an agreement on the Cretan link at a meeting in Brussels on Monday.

The two sides have vied to secure control of the large-scale Cretan link with Athens. This dispute has delayed the project’s development. A smaller-scale Cretan link is planned to link the island with the Peloponnese.

Pundits see little chance of a compromise between IPTO and the Euroasia Interconnector consortium at Monday’s meeting. If so, RAE may award the Cretan major-scale interconnection’s development to IPTO, with conditions attached, next week.  In this case, IPTO would seek minority-stake partners for the establishment of a Special Purpose Vehicle (SPV) to take on the project.

Crete faces a serious energy sufficiency threat as of 2020 as an exemption to EU law concerning power station emission limits for local high-polluting units, such as those operating on Crete, is set to expire in December, 2019. Completion of the island’s major-scale link stands no chance of being completed by 2020, authorities have warned.

In their attempt to resolve the issue, Greek officials are expected to forward a request to the European Commission for some of the main power utility PPC’s diesel-fueled power stations on Crete to be temporarily exempted from the EU’s strict anti-pollution directives, sources informed.

Cretan power stations currently generating 601 MW of the island’s 813 MW in electricity production will need to stop operating in 2020, according to the emission-limit rule imposed by Brussels.

To help counter the looming issue, RAE also appears to be moving ahead with procedures for the transfer to Crete of Heron I, a small 150-MW gas-fueled unit currently operated by the energy firm Heron in Thebes, slightly northwest of Athens. Heron I runs on two types of fuel, natural gas as the main fuel and diesel as a backup fuel. The unit’s transfer to Crete, sought by Heron, would help the Cretan energy sufficiency problem but not fully resolve it.

In addition, the smaller-scale Cretan link, planned to link the island with the Peloponnese via a submarine power cable whose capacity could be anywhere between 150 MW and 180 MW, will offer further support.

RAE could also examine staging RES auctions for the installation of renewable energy units on Crete, such as solar energy facilities, which can be swiftly set up, sources added.