The starting price for NOME-type auctions will be set at less than 42 euros per MWh, below the current System Marginal Price (SMP) level, latest developments indicate.
Judging by the meetings being held on a daily basis between energy ministry officials and technical teams on various issues ahead of next week’s visit to Athens by the creditor representatives, the NOME plan appears to be headed for finalization.
According to energypress, the energy ministry fully understands that NOME auction starting price levels of 45 to 46 euros per MWh, as had been sought by the main power utility PPC, would repel private-sector electricity suppliers from the auctions.
Although PPC is not very enthusiastic about the prospect, it will have no other choice than to accept auction starting prices below the SMP.
As for the plan to split the power grid operator IPTO from its parent company PPC, negotiations between local officials and the lenders are believed to be making solid progress. An agreement will need to be reached along with the next review of Greece’s bailout deal.
The creditor representatives are currently engaged in daily talks with Lazard, SOL, and Norton Rose, their hired consultants for the matter. They are expected to settle on a final proposal next week.
Talks on the IPTO split from PPC are focused on the procedure’s scheduling, compensation details for the power utility, as well as the terms and requirements for the entry of a prospective strategic investor into the agreement.
As was recently reported by energypress, the model being discussed for IPTO is likely to entail offering a strategic investor an equity share of between 20 and 30 percent. A 51 percent of IPTO will be acquired by the Greek State, institutional investors may also be offered stakes, while the remaider will be placed on the bourse.
As for the new IPTO firm’s management, a twin role involving both the public and private sectors is likely to be adopted, similar to an exisiting model at ELPE (Hellenic Petroleum). In other words, the majority of board members and chairman will stem from the public sector, while the managing director will be provided by the strategic investor. Subsequently, private-sector firms will not only be offered a minority stake in IPTO, but a say in the operator’s managerial matters as well.