Decisions on DESFA recoverable amount collection, tariffs expected

RAE, the Regulatory Authority for Energy, plans, within the next few days, to present the board at DESFA, Greece’s natural gas grid operator, a collection plan concerning a recoverable amount of 320 million euros over the next 18 years.

The authority is also expected to present a new tariff reduction mechanism, including its intentions, for 2018, needed as a result of a considerable overestimation of the operator’s earnings in 2017, prompted by a major natural gas consumption increase in the Greek market so far this year.

The recoverable amount to be collected by DEFSA has already been determined but the yearly allocation of this total has yet to be specified.

DESFA’s current tariff mechanisms are based on the assumption of annual regulated revenues totaling 160 million euros. However, the local increase in gas consumption experienced so far this year has already generated an additional 70 million euros in regulated earnings for the operator.

RAE is working on a mechanism that would reduce DESFA’s tariff levels during periods of extraordinary revenues and vice versa.

According to sources, this mechanism will be activated in 2018. Also, tariff changes are expected to be introduced in 2019 as part of a four-year plan, whose details will be determined next year.

Investors considering to bid for a 66 percent stake of DESFA through an upcoming international tender have requested further clarity, including long-term, on revenue-related matters concerning the operator. TAIPED, the state privatization fund, also wants the matter cleared up ahead of the tender’s launch.