PPC faces penalty risk over power station building permit delay

PPC, the Public Power Corporation, risks being penalized for delays if a construction permit for a new lignite-fired power station, Ptolemaida 5, in northern Greece is not issued by March 29.

Spartakos, a union group representing workers employed in electricity production, informed Production Reconstruction, Environment and Energy Minister Panayiotis Lafazanis on the matter in writing, and urged for swift action to avoid “precarious conditions.”

The power unit’s financing has been ensured by a consortium of German credit institutions, guaranteed by the Export Credit Insurance Organization Euler-Hermes.

In the same letter, the union group condemned an online campaign launched to oppose PPC’s prospective development of the new lignite-fired power station. Spartakos, the union group, criticized the campaign’s supporters of resorting to convenient concerns such as health, environment, growth and jobs to back their cause. “Their argument that an energy model based on wind and solar production could create thousands of jobs lacks logic” and results from “a blatant case of misinformation,” the union group stated.

Greece’s green party officially opposes the development of the lignite-fired power station, a pivotal part of PPC’s future energy strategy.

Besides the green party’s negative reaction, it remains doubtful whether PPC –  currently struggling financially as a result of a severe cashflow problem prompted by a rising number of overdue unpaid electricity bills owed to the power utility – is in a position to meet the project’s financial requirements.

Based on a project agreement signed by the power utility, PPC will need to deposit 200 million euros before construction work on the power station commences and a further 200 million euros within six months. The condition was set to ensure financial backing for the project. However, under current conditions, PPC’s requirement of providing 400 million euros appears challenging to say the least.