Possible buyers of lignite units being sold by the main power utility PPC through a bailout-required disinvestment may keep offers subdued at extremely low levels or refuse to make any offers at all if the current deadline for binding bids, set for January 7, is not extended, investors considering the sale have indicated.

They are troubled by the ongoing ambiguity of a series of sale and purchase agreement (SPA) terms included in the disinvestment as incentives – including a voluntary exit plan for employees at two lignite-fired power stations, Meliti and Megalopoli, and the CAT remuneration level for these – and, as a result, cannot yet factor these into their calculations.

The energy ministry and PPC are both well aware of the sale effort’s current risk of failure but the ministry – officially, at least – continues to expect binding offers three days from now.

The CAT remuneration level for the sale package’s power stations has been estimated at 40,000 euros per MW but the European Commission has yet to offer its official approval.

The energy ministry is treading carefully to avoid any blame on Greece for delays in PPC’s disinvestment procedure, one of the country’s main post-bailout commitments.

At this stage, two scenarios appear possible. The sale’s authorities could offer a sizable deadline extension, until March, for example, and ensure clarity for investors, or the sale can proceed as is under a high risk of failure.