Decision on NOME compromise proposal likely today

A decision on Greece’s compromise proposal for the amounts of electricity main power utility PPC will need to offer to the local market through the just-introduced NOME-type auctions may be reached at a crucial Euro Working Group meeting today following the failure by government officials and lenders to reach an agreement during talks yesterday that went on until late last night.

Greek officials are seeking a compromise solution to a proposal forwarded by the lenders that calls for 46 percent of PPC’s overall electricity production – meaning roughly 80 percent of the utility’s lignite-fired and hydropower output – to be offered to the market through NOME-type auctions by 2019.

The NOME issue is not expected to pose a threat to the bailout’s second review if the negotiating sides fail to reach an agreement at this stage.

The Greek side has not accepted the request by lenders for greater electricity amounts through the NOME auctions. Local officials argue that a bailout-related agreement requiring market share losses at PPC should not be linked with the electricity amounts offered through the NOME auctions. Greek government officials contend that the amounts offered through the auctions should only partially cover the total amount of electricity traded by independent suppliers.

Greek officials are looking to secure a compromise deal that would secure sufficient electricity amounts through reasonable production quotas.

The objective of the just-introduced NOME auctions is to provide third parties with access to PPC’s low-cost lignite and hydropower sources as a measure to help break the utility’s market dominance.