IPTO, RAE negotiating WACC rate for disputed Crete link

RAE, the Regulatory Authority for Energy, is negotiating an official WACC figure with Greek power grid operator IPTO, for the Crete-Athens section of the wider PCI-status Greek-Cypriot-Israeli electricity grid interconnection project, headed by Euroasia Interconnector, a consortium of Cypriot interests.

A 7.3 percent investment yield rate for the project’s Crete-Athens segment previously agreed to by the Greek and Cypriot authorities for energy was only indicative and remains unofficial.

IPTO, granted control by RAE of the Crete-Athens segment, is pushing for a considerably higher WACC rate but RAE insists the figure should be set at a lower level, energypress sources have informed.

The setting of a WACC figure is a crucial step for the development of the Crete-Athens link, needed to prevent an energy shortage threat on Crete as of 2020.

However, an ongoing dispute between the Greek and Cypriot sides for control of the wider project’s Crete-Athens segment is complicating matters.

Euroasia Interconnector has refused to acknowledge the legality of RAE’s decision to appoint IPTO project promoter of the Crete-Athens section. This was made clear, yet again, in a January 18 letter forwarded by the Cypriot consortium to related authorities on both sides of the dispute as well as the European Commission,  expressing the consortium’s refusal to appoint a representative for a technical interoperability committee demanded by Brussels as a supervisory body for the wider PCI project’s compatibility.

Four days earlier, RAE had asked Euroasia Interconnector to appoint a representative for this technical committee by the January 18 date. Instead, in its letter, Euroasia Interconnector described the initiatives taken by RAE as illegal and called for the Greek energy authority to honor commitments set in a road map endorsed by Brussels for the wider PCI project.