Unlike the slow pace of wider energy-sector developments until now, the next few weeks, based on the current schedule, are expected to provide a whirlwind of activity as a result of EU and bailout commitments. Legislation will need to be ratified by the end of June for four sector reforms – the power grid operator IPTO’s split from main power utility PPC, the parent company; NOME auctions; new support mechanism for the renewable energy sources (RES) sector; and the electricity market’s target model.
The draft laws will be submitted to Parliament for ratification either separately, as pairs, or as attachments to other legislative actions.
Two of these energy-sector measures, the IPTO split from PPC, and the NOME auctions – to provide third parties with access to PPC’s low-cost lignite and hydropower sources with the intention of breaking the utility’s dominance – are among the requirements that need to be fulfilled if the current first review of Greece’s third bailout is to be finalized. This means the measures will need to be legislated prior to the next Eurogroup meeting on May 24. As a result, it is highly likely that the IPTO and NOME measures will be included in a multi-bill carrying all pending bailout requirements to be submitted to Greek Parliament by Sunday week, the latest.
Existing laws linked to Greece’s bailout agreement that concern a previous part-privatization plan for PPC – locally dubbed “Little PPC” – and an older plan to privatize 66 percent of IPTO, will both be nullified as part of the latest process.
As for the other two measures – electricity market’s target model and the RES support mechanism – the energy ministry intends to forward both for public consultation by the end of May before submitting respective draft laws to Parliament by the end of June, assuming no obstacles delay this schedule.
Based on the new plan, once the new law for IPTO is ratified, PPC’s shareholders will need to approve the sale of at least a 20 percent share of the utility to a strategic investor. A tender, through which a strategic investor will be chosen, will need to be launched this July and completed by October.
The new law to regulate the NOME auctions, based on a French model, will stipulate that 20 percent of PPC’s wholesale and retail electricity market shares must be shed by 2017 before they fall to levels of less than 50 percent by 2020. PPC is expected to stage its first NOME auction in September, offering electricity amounts to independent traders measuring eight percent of the total amount supplied to the grid in 2015.