Independent suppliers wary of NOME starting price prospects

An imminent ministerial decision on the starting price for NOME auctions, expected to be launched in September as a means of increasing competition in Greece’s electricity market and reducing the dominance of power utility PPC, generally has interested parties, or independent power suppliers, waiting in nervous anticipation.

However, officials contacted by energypress appear to be far from optimistic following energypress’s recent disclosure of a plan by RAE, the Regulatory Authority for Energy, to set the starting price at around 38 euros per MWh.

Sources at independent electricity supply firms believe this starting price is too high given the System Marginal Price (SMP), hovering at levels of as little as 41 euros per MWh. This makes the prospect of a NOME starting price of 38 euros per MWh less competitive, some sources contended.

Other sources pointed out that such a starting price is excessive as it does not factor in the variable costs at PPC’s lignite-fired power stations and hydropower units.

Officials at PPC seem unperturbed. No mention of the NOME auction starting price issue was made at Monday’s general shareholders meeting.

PPC had sought to establish a prerequisite demanding that auction participants cater to all electricity customer categories – farming, high, medium and low voltage. This proposal was rejected but PPC returned with a new proposal that aims to restrict the amounts of electricity to be offered through the NOME auctions. It was submitted by PPC’s chief executive Manolis Panagiotakis to European Commision officials during a recent meeting and is being examined.

NOME auctions promise to provide third parties with access to PPC’s low-cost lignite and hydropower sources as a measure to help break the utility’s dominance.