Energy minister advises PPC to write off bad debt amounts

Energy Minister Panos Skourletis has told the main power utility PPC to write off long-standing arrears owed to the utility by enterprises that have been out of business from as far back as the 90s.

PPC’s list of consumers with arrears includes many long-forgotten enterprises, examples including Piraiki Patraiki, once Greece’s biggest textile industry, which shut down in 1996, fellow textile company Egeo, an enterprise once run by the Karellas family, shut since February, 1990, as well as scores of defunct insurance and stock exchange trading companies.

In other words, part of the total sum owed by consumers to PPC, currently valued at roughly 2.2 billion euros, stands to vanish for good. The size of this bad debt figure remains to be seen.

PPC has contended it cannot reduce electricity tariffs as a result of the large sum of unpaid overdue electricity bills owed to the utility. A more realistic consumer debt picture would make this argument less valid.

The energy ministry wants PPC to come up with a more realistic picture of the amounts it is owed and also improve its payback terms offered to consumers with arrears, the ultimate objective being to reduce tariffs.

Much work still needs to be done by PPC if it is to determine a realistic bad debt amount and then cut it off as dead wood.

Developments on prospective improvements for payback terms offered by PPC to consumers with arrears are expected within the next few days. The energy ministry is pushing for an increase in the number of installments offered and an end to a deposit payment demand set as a qualifying condition.

Officials at the ministry believe such revisions will help make PPC’s collection effort more effective, which, in turn, could allow the utility to lower tariff rates.

At present, PPC demands a ten percent deposit, based on amounts owed, before consumers can qualify for the payback plan that breaks down their electricity bill debt into installments. Although as many as 36 installments can theoretically be offered to consumers, the number actually averages less than 20. Very few consumers are offered 36 installments. Authorized staff at PPC outlets decides on the payback terms after examining applications individually.