Energy minister Giorgos Stathakis returned to Athens from Brussels last night having agreed to lender demands for the sale of main power utility PPC units. The minister held a series of bailout-related meetings with lenders during the week.
The new agreement’s framework recognizes that the recently introduced NOME auctions are proving futile on two issues they were intended to resolve. One of these issues is Greece’s adjustment to a European Court verdict requiring PPC to offer independent traders greater access to its lignite sources. The other is a demand by the lenders for a drastic reduction of PPC’s retail electricity market share.
The Greek side’s admittance of the NOME tool’s failure to deal with both these issues sets the path towards PPC unit sales.
The current demand tabled by the country’s lenders for a 40 percent sale of PPC’s lignite-fired production capacity is not new. It had initially emerged through a European Court decision in 2009. Prolonged negotiations concerning this ruling’s implementation followed. The European Commission pushed for the ruling’s adoption while Greek officials sought its least painful application. The ordeal included a court ruling in favor of PPC that was eventually overturned.
The European Commission is now renewing its older demand for PPC units sales but adjusting it to the current reality.
Besides lignite-fired units, the lenders are also believed to be pressuring for hydropower stations to be included in PPC’s overall sale package.
The government and state-controlled PPC will maneuver to avoid selling major hydropower stations at the Aliakmonas and Acheloos rivers, representing the bulk of the utility’s hydropower production.
The details of PPC’s sale package and its schedule will be discussed at upcoming meetings to be based on the delivery of related information on the utility’s units requested by the lenders.