Although a draft bill for the new RES support plan forwarded by the energy ministry for public consultation does not include a paragraph concerning the restructuring of the RES special account and how it will be funded, energypress sources have informed that a corresponding paragraph will be included by the time the bill is submitted to Parliament for ratification.
The new RES mechanism to be introduced will have two key objectives, to eliminate the RES special account deficit by the end of 2017, a bailout-related requirement, and to avoid the need to increase the RES-supporting ETMEAR surcharge included on electricity bills. Energy minister Panos Skourletis has promised consumers will not be further burdened.
Until now, the ETMEAR surcharge has served as a tool to cover RES special account deficits. Whenever LAGIE, the Electricity Market Operator, has forecast deficits, RAE, the Regulatory Authority for Energy, has increased the ETMEAR surcharge on electricity bills.
It all boils down to meaning that as consumers will not be forced to cover the RES special account deficit through an ETMEAR surcharge hike, then the burden will be shifted elsewhere. According to energypress sources, electricity suppliers – main power utility PPC, primarily, as well as the market’s independent suppliers, who still represent a small fraction of the market – will be called on to pay, or, as the energy ministry sees it, return part of the additional profits prompted by a reduced System Marginal Price (SMP). This SMP reduction is the key factor behind LAGIE’s forecast for a new increase in RES special account deficit figures.
The addition of RES producers to the grid has been a key factor behind the substantial SMP reduction. The country’s existing model has increased the ETMEAR demands. At the same time, lower SMP levels have considerably increased the profit margins of electricity suppliers, as SMP prices represent the wholesale electricity prices at which suppliers purchase.
The government’s reasoning is based on these factors. Rather than force consumers to cover lower SMP prices through ETMEAR surcharge hikes, the energy ministry believes electricity suppliers, who are benefiting from the SMP drop, should pay instead.
A new RES special account charge will be established for electricity suppliers. The degree to which RES producers have influenced the SMP drop will be used to help calculate the new charge. Caculations have already been made and the formula is expected to be included in the draft bill for the new RES support plan.