Greece, lenders agree to seek alternative to IPTO sale plan

The privatization plan for IPTO, Greece’s Independent Power Transmission Operator, has been ruled out following preceding procedures to sell a 66 percent stake through an international tender. The government and the country’s lenders have agreed to work on finding an alternative solution over the next few days.

A proposal forwarded by the energy ministry in the summer will be used as the basis of the new plan but will be significantly revised in accordance with lender observations and objections.

Energy ministry officials and technical teams representing the country’s lenders have been negotiating on the matter in Athens. Lenders have already forwarded, in writing, objections concerning the Greek counterplan delivered last August. The objections delivered reminded of a bailout term calling for IPTO to be seceded from its parent company, the main power utility PPC.

The Greek counterplan that had been offered by the energy minister Panos Skourletis, as energypress exclusively reported in August, proposed keeping IPTO’s fixed assets (transmission networks) at PPC and seceding competition-linked activities, or, more specifically, the distribution center in Agios Stefanos. The plan proposed transferring these activities to LAGIE, the Electricity Market Operator, entirely owned by the Greek state and responsible for the operation of the country’s wholesale electricity market. The plan also anticipated transforming LAGIE into a “new IPTO” and offering a 49 percent stake to third parties, with the existing IPTO to remain a fully-owned PPC subsidiary charged with the responsibility of maintaining and developing the grid.

According to sources, the new plan will seek to overcome the bailout terms concerning IPTO’s split from PPC through a majority equity share acquisition by the Greek state of the “new IPTO”. This stake, as is the case in other European countries, must, by no means, be associated with the energy ministry, which supervises the sector. Also, the shares to be held by PPC will be preferred shares entitled to dividends but will not offer the power utility management and voting rights at shareholder meetings.

This plan will serve as the basis for the attempt by energy officials and lenders to shape and agree on an alternative solution over the next few days.