Energy ministry officials are seeking a compromise solution to the higher electricity amounts the country’s lenders want offered through Greece’s NOME-type auctions, a pending energy-sector prior action in the bailout’s ongoing second review.
A proposal forwarded to the Greek government by the lenders calls for 46 percent of main power utility 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 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.
The Greek side has yet to accept 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.
At present, Greek officials are pushing for a compromise solution that may satisfy all sides involved.
The bailout’s terms, requiring electricity auction amounts to be offered as a percentage of last year’s total consumption in Greece, set the annual proportions at 8 percent for 2016 (460 MWh) and 12 percent for 2017 (675 MWh).
However, the lenders are interpreting these terms differently. They are now demanding that a 20 percent proportion, the total of 2016 and 2017, or 1,135 MWh, be offered through the auctions next year. This essentially means that this year’s amount of 460 MWh, made available and absorbed last month through the inaugural NOME auction, will need to be offered for a second time in 2017, as an additional amount to the 675 MWh PPC must auction off in 2017.
Regardless of the finalized NOME electricity amount, PPC officials, convinced that the auction process will severely affect the corporation’s financial figures, are forging ahead with a plan to try and split and sell a new splinter company with existing clients on board, as a way of achieving bailout market share reduction targets set for the utility.
“We continue to believe this proposal is sustainable and are pursuing its actualization,” a PPC official told energypress.