Negotiations on PPC lignite monopoly at crucial stage

Energy ministry officials and European Commission technocrats from the Directorate-General for Competition are negotiating for an agreement on a transitional mechanism to limit power utility PPC’s monopoly in lignite-fired electricity generation until its coal generators are gradually withdrawn from Greece’s energy system.

The transitional mechanism would operate until 2023, when the government plans to have withdrawn all of PPC’s existing lignite units, offering third parties access to lower-cost lignite-fired electricity.

In other words, PPC will need to sell lignite-fired electricity. However, the negotiating sides are at odds as to who will be able to buy. The Greek proposal limits the purchasing eligibility of lignite-fired electricity – through a mechanism, or an SPV – to energy-intensive industrial producers. Brussels also wants independent power  suppliers included.

Negotiations began soon after the festive season. The Brussels technocrats may also meet with Greek energy minister Costis Hatzidakis this week, possibly on January 23.

The European Commission technocrats are not yet convinced of the Greek  decarbonization plan’s adequacy. Greek officials are attributing the tough Brussels stance to the previous government’s failed sale effort of lignite units. An attempt is now being made to restore credibility, energy ministry officials noted.