The main power utility PPC’s electricity tariffs will be reduced for all household categories, under the condition that the utility’s just-revised payback scheme, offering softer terms for PPC consumers with arrears, improves the corporation’s electricity bill collection effort and international crude oil and natural gas prices remain low, the energy minister Panos Skourletis noted at a news conference today.
The current combination of lower household incomes in Greece, down by as much as 45 percent over the past few years, and electricity tariff increases by an equivalent percentage, or possibly more, cannot go on any longer, the minister noted, obviously critical of PPC.
PPC’s revised payback scheme, which will be launched tomorrow and offers all consumers the right to settle arrears over 36 installments without any deposit payment, emerged following pressure applied on the utility by the government.
During the news conference, Skourletis acknowledged that PPC’s large amount of unpaid recievables, estimated at 2.3 billion euros by the utility, have negatively impacted its financial standing and ability to reduce electricity tariffs in the immediate future. Earlier this week, PPC reported a 102 million-euro loss for 2015.
As for the natural gas sector, the minister left open the prospect of a tax hike on natural gas but stressed that, even if imposed, prices would remain lower than last year.
Skourletis condemned the EPA Attiki gas supply company, which covers the wider Athens area, for not having sufficiently decreased its natural gas prices. The company lowered its prices by 11 percent last year, compared to 24 percent by EPA Thessaloniki and EPA Thessalia, the energy minister pointed out.
However, Skourletis partially justified EPA Attiki, saying that the discrepancy could be attributed to the much greater penetration of natural gas in the Thessaloniki and Thessalia markets, which makes operating costs for these suppliers lower.
Acknowledging that the cost of natural gas for the industrial sector is hefty, Skourletis said officials are examining ways to reduce the level of various components leading to the final price. An informal committee is looking into the issue, he said.
The minister expressed satisfaction over the progress being made in negotiations with the country’s creditor representatives for major energy-sector matters, especially plans to introduce NOME-type auctions into the Greek market and split the power grid operator IPTO from PPC, its parent company. Both issues will soon be finalized, when creditor representatives return for a bailout deal review, Skourletis said.
The effort to sell a 66 percent stake of DESFA, the gas grid operator, to Azeri energy company Socar and other certified European operators has stalled as a result of a dispute concerning network usage fees. Skourletis wants to nullify original terms that would allow the prospective buyers to significantly increase network usage fees by levels of as much as 60 percent. These network usage fees represent DESFA’s earnings. Skourletis said the Greek government had forwarded a proposal to Socar and is awaiting a response.
The minister declared official the government’s interest in steering PPC towards corporate partnerships with private-sector investors for ventures that would include PPC’s lignite-fired power stations and hydropower facilities. “All is open for discussion,” he commented.
Skourletis also highlighted the importance of major infrastructure projects headed for development, such as the TAP natural gas pipeline, to carry Azeri gas to central Europe via northern Greece, Albania and Italy, and whose construction will be officially launched at a ceremony in Thesssaloniki on May 17; the Greek-Bulgarian IGB interconnector; as well as a floating LNG terminal in Alexandroupoli, northeastern Greece.