Industry reacts strongly to sharp gas distribution fee hike

A sharp increase to a natural gas distribution fee, from 0.8 euros per MWh to 4 euros per MWh, a bailout measure aiming to help end Greece’s regional natural gas monopolies, has provoked strong reactions in the industrial sector.

The sizeable increase to the natural gas distribution fee is intended to compensate regional gas suppliers (EPA) for the premature termination of exclusive supply deals in their respective regions of wider Athens, Thessaloniki, and Thessalia, in the mid-northeast. DEPA, the Public Gas Corporation, collects and manages the distribution fees.

According to sources, certain major-scale industries, which, until now, have benefited from lower rates, are also being subjected to the higher distribution fee. As expected, they have reacted sharply. Sources have informed that some of these major-scale industrial enterprises have already declared they will refuse to pay the increased amount.

Based on market information informally requested last November by RAE, the Regulatory Authority for Energy, from the EPA gas supply companies and DEPA, as part of the lead-up to gas market reforms, it was concluded that 1.2 euros per MW, just over a quarter of the gas distribution fee now demanded, would represent a reasonable price.

This significant discrepancy could serve to back the reaction voiced by the selected major-scale industries, which are demanding a revision, based on the RAE conclusion.

Although the increase applies to the entire industrial sector, it will not be passed on to household consumers until January 1, 2018, when they are expected to have acquired the right to choose from various gas suppliers.