PPC punctuality discount cut promises mild relief for rivals

A main power utility PPC decision reducing its punctuality discount for customers paying electricity bills on time to 10 percent from 15 percent comes into effect today, promising independent electricity suppliers some relief.

The development has increased the expectations of independent electricity suppliers for market share and revenue gains as PPC’s discount policy revision, effectively a 5 percent price increase, will make rivals more competitive.

Many independent electricity suppliers were recently forced to trigger a tariff-increasing clause due to higher wholesale prices. This has emerged as a major disincentive for consumers considering moves away from PPC, still the dominant supplier.

A plan by authorities to soon return a RES special account surplus for 2018 to suppliers also represents good news for PPC’s rivals. This is made even more favorable for independent suppliers by the abolishment, from the beginning of the year, of a supplier surcharge they have been contributing to the RES account.

These developments promise some relief for independent electricity suppliers but market problems remain, as was highlighted by officials at last week’s Power and Gas Forum in Athens.

Key concerns include PPC’s lack of a cost-based pricing policy; the distorted implementation of NOME auctions and higher starting prices expected at these as of June; as well as the power utility’s insistence to continue operating two ageing power stations, Amynteo and Kardia, despite the exhaustion of time limits.

Higher wholesale electricity prices appear likely to keep rising in the immediate future as a result of elevated CO2 emission right costs and fuel prices.