PPC’s renewed lignite units sale faces crucial three-week period

The main power utility PPC, in its financial report for 2018, has made blatantly clear the positive impact on the company of a successful sale of its Meliti and Megalopoli power stations, included in a bailout-required disinvestment of lignite assets.

Besides being rid of annual operating losses incurred by these facilities, estimated at a total of 100 million euros, PPC also stands to benefit from reduced CO2 emission right cost purchases, a lighter environmental footprint, a gain of approximately 223.8 million euros from the gradual withdrawal of NOME auctions, and less European Commission pressure for an additional disinvestment of hydropower units.

The 25-day period remaining until the sale procedure’s completion on May 28 will be crucial for the effort’s outcome. Possible buyers remain reserved.

An improved lignite supply agreement reached by PPC with the operator of the Ahlada mine feeding the Meliti power station, uploaded several days ago to the sale’s virtual data room, has not fully eased the concerns of investors. A number of issues concerning the expropriation of the village Giourouki in the area, which needs to be completed by December 31, remain unresolved. Otherwise, the new supply agreement’s terms cannot apply.

Also, investors appear to have raised wider energy mix issues and proposed other adjustments that could increase the likelihood of a successful sale, renewed after an initial effort failed to produce a result.

PPC’s board has noted it cannot guarantee the prevention of further disinvestment obligations in the future concerning its interests in lignite and other sectors as a means of meeting market share contraction targets in electricity production and supply.