New IPTO owner to be left free to increase staff, salaries

The prospect of personnel and salary increases at IPTO, Greece’s Independent Power Transmission Operator – locally referred to as ADMIE – by its prospective new owner has been left wide open following a decision reached yesterday by RAE, the Regulatory Authority for Energy.

The additional cost to be created by this move, if implemented, will be recovered by IPTO through network charges paid by consumers.

At present, IPTO is understaffed as over 250 employees have retired in recent years without being replaced by new recruits. The shortage has led to delays of projects and reports required amid the electricity market’s changing landscape.

Based on bidder indications, IPTO’s prospective new owner, to acquire a 66 percent stake in the operator, is expected to hire additional staff. The majority stake to be acquired by the new owner will nullify restrictions imposed on IPTO – as is the case with all Greek state-controlled companies – as part of the country’s bail-out agreement. The lifting of current restrictions will also apply to remuneration packages. Current salary reductions and caps will no longer be valid once the operator’s majority stake is privately controlled.

This was the case in Portugal, following the privatization of EDP, which led to the reinstatement of the electricity company’s salaries to pre-bailout agreement levels.

Based on the RAE decision, the Allowed Revenue at IPTO for 2015 is 254.6 million euros, 250.2 million euros for 2016, and 261 million euros for 2017. The administrator’s Adequate Revenue (minimum Actual Collected Revenue), the amount that will need to be collected from consumers through network charges, is approximately 10 million euros greater in 2015 compared to 2014, or 215 million euros from 205 million euros, a 4.5 percent increase. Its additional burden will not exceed a few cents per electricity bill.