The country’s lenders, especially the European Commission, disagree with a Greek request calling for the exclusion of high-voltage electricity consumption, amounting to approximately 6,800 GWh per year, from the calculation of main power utility PPC’s total supply, as this factor increases the electricity amounts the power utility must offer through the NOME auctions.
State-controlled PPC has insisted on this exclusion, which, in turn, has been adopted by Greece’s negotiating team for the bailout’s third review. Pending energy-sector issues need to be settled by tomorrow.
In its support of this demand, PPC has noted that competition does not exist in the high-voltage market as independent suppliers have not shown an interest in this domain. Officials at PPC contend that the power utility cannot be called upon to support industrial production with low electricity tariffs offered through NOME auctions in accordance with the current terms.
NOME auctions were introduced just over a year ago to offer independent suppliers access to PPC’s low-cost lignite and hydropower sources.
The lenders also want electricity export-restricting terms imposed by RAE, the Regulatory Authority for Energy, on suppliers participating in the NOME auctions, to be lifted. Milder export restrictions may remain intact, sources have informed.
A number of other energy-sector issues also remain unresolved in the third review bailout talks. These include specification of structural measures to be adopted should an upcoming market test concerning PPC’s bailout-required sale of lignite units fail to draw sufficient investor interest. The lenders insist on a term that would add hydropower units to the sale package, combined with NOME adjustments reducing electricity amounts offered through this procedure.
Current overstaffing at certain PPC lignite units is expected to dampen the interest of investors in the market test.
The lenders are also pushing for a strict timeline leading to the establishment of a Greek energy exchange by March, as was proposed last week.
The institutions also want a supplier surcharge lifted by March. It was introduced about a year ago. The lenders have proposed making up for this measure’s resulting loss of RES special account revenues by increasing the ETMEAR surcharge, also feeding the RES special account.
Greek officials insist the supplier surcharge issue should be incorporated with developments concerning the establishment of an energy exchange, part of the target model, a process entailing the electricity wholesale market’s harmonization with EU law.
A demand by lenders aiming to diminish the role of DEPA, the public gas corporation, in Greece’s natural gas market, stands as a major obstacle in the ongoing talks.