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DEPA Chief: ‘Holistic approach to energy matters needed more than ever’

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Mr. K. Xifaras, CEO of Public Gas Corporation of Greece (DEPA) SA., writes for International Energy Exhibition of Greece 2022

DEPA Commercial is Custodian of Greece’s energy security and of the smooth operation of the domestic energy market. Today, the energy sector, both in Greece and worldwide, is faced with a series of challenges and unforeseen factors which highlight, now more than ever, the need for a holistic approach to energy matters. The need to contain energy costs and support the society, on one hand, and the process of energy transition, on the other, have created a situation in which the market needs to find a balance which will ensure both the country’s energy efficiency and its survival in sustainable terms.

While trying to solve this difficult equation, the role of natural gas, as a bridge, fuel proves to be decisive for shaping the future of the energy market, given the diversification of energy sources and routes of supply and transport, as well as the expansion of storage capacity. DEPA Commercial, which consistently serves these strategic priorities, has been developing a multi-level strategy for the last three years that has proven to be particularly effective. A strategy with double focus: the verticalization and expansion of corporate activities, and the seamless transition to “green” energy, both of which are national goals described in the National Energy and Climate Plan and the European Green Agreement, enhancing our country’s role as a regional energy hub for the wider Southeast European region.

In order to cover the country’s immediate energy needs and to shield its energy security, DEPA Commercial is increasing the supply of LNG either through current contracts or through the spot market, while having already secured long-term agreements on more favorable terms. At the same time, the company is investing in important infrastructure projects and programs, which are drastically reshaping the energy status quo of the region and are contributing decisively to the process of Europe’s independence from Russian gas, such as the Greek-Bulgarian pipeline – IGB and the offshore LNG terminal (FSRU) in Alexandroupolis. Both, projects which will significantly increase the capacity of supply and storage of both Greece and the neighboring countries it serves.

TAP, Poseidon and EastMed are equally important pipeline projects, with the latter returning dynamically to the forefront as a result of the energy crisis, since it will enable the transport of natural gas from the fields of the Eastern Mediterranean to Europe. To that direction, DEPA Commercial is currently in advanced discussions with trading companies from Israel and Egypt.

In this way, a safety net is established regarding the security of supply in the wider region, which upgrades Greece’s geopolitical status by transforming it into a regulatory factor in the energy landscape.

Simultaneously, given the enhanced importance of natural gas, we have designed a comprehensive strategy aiming, on the one hand to expand the use of natural gas, both geographically and in terms of uses, and on the other hand to create the conditions for the development and utilization of renewable and alternative forms of energy. Keeping this in mind, DEPA Commercial is leading the developments towards the transition to a greener economy by designing and implementing initiatives that promote the further penetration of natural gas in the country’s energy mix, as a transitional fuel on the way to cleaner energy forms. The company also contributes substantially to the promotion of gas mobility and the use of cutting-edge technologies, such as Small-Scale LNG and CNG, thus expanding even further the natural gas network and ensuring distribution even in the most inaccessible areas. At the same, time, emphasis is placed on the development of a sustainable and efficient LNG supply chain for maritime transport that will increase the growth prospects of the Greek shipping sector.

With its sights on the future, DEPA Commercial is already active in the field of Renewable Energy Sources by creating a “green” portfolio that exceeds 200 MW of photovoltaic parks, and is also developing projects, infrastructure and technologies which will be able to serve in the future even “greener” energy such as hydrogen and biomethane.

Moreover, at DEPA Commercial we have proven that we operate always considering pertinent societal issues and, for this reason, with a true sense of responsibility we are contributing decisively to the absorption of a significant percentage of the rise in international gas prices, through the implementation of targeted market interventions aimed at supporting households and businesses, in full cooperation with the Ministry of Environment and Energy.

With a solid vision and through hard work, DEPA Commercial is today an integrated energy company, with strong bases, operating vertically and according to modern corporate governance terms. We are meticulously planning our next steps and we are creating the conditions to successfully meet the ever-changing needs of the market and the economy.

 

Gas conversion cost support key to further penetration of energy source

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The government plans to soon launch a subsidy program offering households incentive to connect with natural gas networks, though coverage of conversion costs, Adonis Georgiadis, the minister for development and investment, has told an event staged by gas distributor Hengas in Kalamata.

The subsidy program will encourage a greater number of consumers, especially households, to make the switch to natural gas, Hengas officials pointed out to energypress.

According to Hengas’ business plan, entailing the development of natural gas networks and stations to cover 11 provincial cities around Greece, the Peloponnese cities of Kalamata and Sparta will be supplied compressed natural gas (CNG) by the first quarter of 2023.

Megalopoli, Tripoli and Corinth have been connected to the gas network ahead of schedule, Hengas has reported.

Hengas’ development plan, budgeted at 65 million euros and approved by RAE, the Regulator Authority for Energy, entails the development of natural gas networks and stations covering a total of 11 provincial cities – Tripoli, Corinth, Megalopoli, Edessa, Polykastro, Polygyros, Deskati, Naousa, Skydra, Kalamata and Sparti – either through direct connections with the country’s gas grid or CNG and LNG transportation.

DEPA: CNG, LNG supply in remote areas must be competition-based

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Gas company DEPA Commercial has objected to a RAE (Regulatory Authority for Energy) proposal calling for the development of distribution networks at remote areas for CNG and LNG supply, noting, in related public consultation, that such a move would not reflect international practices, according to which CNG and LNG compression and transportation activities are taken on by suppliers based on free market competition conditions and prospects.

The RAE proposal for CNG and LNG distribution networks covering supply in remote areas is extremely restrictive and does not allow for alternatives that would facilitate greater competition and reduced costs for consumers, DEPA Commercial contended.

Also, any decision to develop virtual pipeline networks in remote areas should serve as a temporary solution and ensure that the normal development of distribution networks is not undermined, DEPA Commercial noted.

Gas grid operator DESFA, in its contribution to the public consultation procedure, noted that if a virtual pipeline network is regarded as part of the national grid, then this would help boost social welfare, minimize any potential burden on existing gas consumers, and maximize the positive impact of natural gas penetration in Greece.

 

 

Interview: How EDA THESS achieves growth, reduction of tariffs and returns for shareholders

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The main features of EDA THESS’ development program are the increased penetration of natural gas by the network’s expansion and the implementation of reduced tariffs for consumers combined with increased returns for the shareholders, as referred by the General Manager of the Company, Leonidas Bakouras, in his interview on energypress.

(See the full interview with Mr. Bakouras: Interview of the General Manager of EDA THESS, Mr. Leonidas Bakouras, on energypress.gr) 

The reduction of gas distribution tariffs for domestic and industrial consumers is a “result” of the Company’s strategy, with the main pillar being the design for high quality network construction, which is based on techno-economic criteria of efficiency.

It is no coincidence that, in the recent period due to tariff reductions, 20 new energy-intensive industries and large consumers have signed connection contracts to the natural gas network.

At the same time, the investment program of the Company, as approved by the competent Authority for the period 2021-2025, is in progress, in light of the great expectations deriving from the extremely positive results of 2020.

“We have a large Program which was approved at the end of December by the Authority for the period 2021-2025 and implementation of investments has already started in January”, said Mr. Leonidas Bakouras, pointing out that for 2020, 23,000 new connections were acquired, distributed volumes were increased by 10% compared to the previous year of 2019 and natural gas penetration reached 64% in population.

The General Manager of EDA THESS made special reference to CNG technology, which has a dual role, both for the safe and uninterrupted operation of the distribution network in case of any malfunction, and for the natural gas distribution in remote areas. According to him, the Company has supplied new areas with CNG technology, a successful model since it managed to supply even the most remote areas with natural gas.

Referring to the positive financial results of the Company, the distribution of 20 million euros in dividends to the shareholders is expected, and as Leonidas Bakouras characteristically stated: “We achieve return on equity (ROE) of 7.2%, a ratio that showed a four-year high. We are on an upward trajectory, as shareholders are satisfied, consumers are satisfied (since distribution tariffs are reduced), and employees are satisfied. A triptych that contributes to the development of our country, offering a healthy working environment and added value to the place”.

Distributor DEDA wants swifter delivery of operator projects

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Gas distributor DEDA, covering all areas around Greece except for wider Athens, Thessaloniki and Thessaly, wants gas grid operator DESFA to complete key grid projects six months sooner so that the distributor may proceed with tenders for distribution network expansion projects.

DESFA needs to construct metering/regulating stations in Livadia, central Greece, as well as the Kastoria and Kozani regions in northern Greece.

DEDA called for a swifter delivery of these stations in public consultation staged for DESFA’s ten-year development plan covering 2021 to 2030.

DESFA plans to complete work on the Livadia metering/regulating station in March, 2022. However, DEDA has requested the station’s completion six months earlier, explaining it will not be able to distribute to consumers in the area until the station’s construction has been completed.

DEDA also called for the Kastoria and Kozani stations to be complete six months earlier, citing the same reasons.

In addition, DEDA requested the development of a natural gas compressor station close to the areas of Karpenisi, central Greece, and Amfissa, slightly southeast, to facilitate CNG supply to these regions.

DEPA Commercial to enter RES field, starting with 200-MW goal

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DEPA Commercial, the new entity emerging from gas utility DEPA, will enter renewable energy production as part of the company’s transformation from a gas to energy company, its administration has decided.

The firm has already held talks with green energy players with the aim of involving DEPA Commercial in solar and wind energy projects about to enter the construction stage or already being constructed, sources informed.

An initial objective for the accumulation of a green-energy portfolio comprising approximately 200 MW has been set by the company, sources added.

Careful steps are being taken in the RES sector, Dr. Konstantinos Karagiannakos, the company’s Coordinating Director of Trading Activities, recently noted.

Having lost a steady and reliable market share in gas distribution, a sector that guaranteed DEPA annual profit of about 25 million euros, DEPA Commercial is now eyeing new activities and revenues from domains that offer more consistency than trade, entailing higher risk.

Besides the RES sector, DEPA Commercial’s lower-risk approach has also led to an interest in the prospective Alexandroupoli FSRU in northeastern Greece.

The company is also broadening its activities to cover gas supply for the industrial sector and customers in areas without gas networks, through small-scale LNG and remote CNG solutions, as well as the gas-run vehicle market through the development of a nationwide network of refueling stations.

In addition, the company is also making plans to enter eco-friendly alternative fuel markets such as hydrogen and biomethane.

 

Gas distributor DEDA’s 5-year development plan minus 8 cities

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Gas distribution network projects in eight provincial cities have been removed from gas distributor DEDA’s five-year development plan approved by RAE, the Regulatory Authority for Energy, as their estimated completion dates exceeded deadlines by more than 18 months.

Projects in a total of six Peloponnesian cities as well as northern Greece’s Veria and Giannitsa had been included in the previous version of the DEDA development plan, covering 2020 to 2024.

DEDA, now under the wings of DEPA Infrastructure, a new entity formed by gas utility DEPA ahead of its privatization, distributes to Greece’s areas not served by EDA Attiki (wider Athens) and EDA Thess (Thessaloniki and Thessaly).

According to DEDA’s initial five-year plan, Tripoli, Corinth, Argos and Nafplio, all in the Peloponnese, were planned to gain network infrastructure enabling gas supply via a high-pressure pipeline operated by gas grid operator DESFA.

The plan also entailed the development of infrastructure for LNG supply from DESFA’s Revythoussa terminal, close to Athens, to the Peloponnesian cities Kalamata and Sparti.

Projects for CNG supply to Veria and Giannitsa in the country’s north were also excluded by RAE from the five-year DEDA plan it approved.

 

Edil Hellas seeking gas distribution license for two areas in north

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Edil Hellas, a technical projects firm established in 1985 in northern Greece, has applied for a gas distribution license to serve disconnected parts of northern Greece.

If the application is approved by RAE, the Regulatory Authority for Energy, Edil Hellas would emerge as Greece’s first privately run gas distributor.

Edil Hellas has requested permission to set up a CNG station for supply to a distribution network intended to reach household and business consumers as well as small-scale producers in the Grevena and Kilkis areas.

Until now, Edil Hellas has been active in the development of technical projects concerning natural gas, telecommunications as well as waste collection and management.

Edil Hellas has maintained a lengthy association with gas supplier EPA Thess for the construction and expansion of gas networks in the Thessaloniki and Thessaly areas.

The application submitted by Edil Hellas comes amid a growing interest by small-to-medium sized private firms to tap gas market opportunities.

PPC seeking natural gas retail, wholesale, infrastructure roles

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RAE, the Regulatory Authority for Energy, has issued a natural gas supply license to the main power utility PPC, the authority has officially announced, paving the way for the electricity company to pursue a revised business plan for the future that is expected to include penetration into the natural gas sector’s retail and wholesale markets, as well as involvement in major-scale gas infrastructure projects.

PPC is preparing its entry into the natural gas market, a development that promises to transform the corporation from a natural gas consumer to a key player, PPC’s deputy chief Stavros Goutsos stressed.

At present, the power utility is the country’s biggest natural gas consumer, requiring approximately 1.4 bcm for electricity generation needs, from 4.8 bcm of the country’s total for this purpose.

According to energypress sources, PPC is examining the prospect of taking part in major natural gas sector projects such as the Kavala gas storage facility, the FSRU in Alexandroupoli, CNG development around the country, as well as small-scale LNG infrastructure development for supply to the islands.

The same sources informed that PPC is also looking to become involved in the LNG spot market as its plans include importing LNG shipments.

As for the retail gas market, PPC is striving to offer combined gas and electricity packages to consumers by October. Rival firms are already offering such combined packages.

PPC will aim for a retail gas market share of around 30 percent given its substantial client base in the electricity market. The firm is taking its cue from similar moves taken by major power firms around Europe that have also entered natural gas markets. The growth prospects promised by the Greek gas market represent a key incentive.

 

Natural gas-fueled electricity generation in north Aegean examined

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The feasibility of a plan entailing natural gas supply to the non-interconnected islands in the north Agean for the purpose of electricity generation is being examined by RAE, the Regulatory Authority for Energy.

Officials at the authority are considering the development of small-scale facilities that could run on LNG or CNG.

RAE established a committee in 2015, based on an EU directive, to study the feasibility of such a plan. The interest expressed appears to be growing.

Both the main power utility PPC and gas utility DEPA have previously jointly examined the possibility of using CNG for electricity generation on the islands with the prospect of a partnership in mind.

RAE has endorsed a sum of 42,000 euros to support a related study’s completion, expected to be delivered in three months.

 

 

 

 

 

RAE finalizing framework for CNG supply to remote areas

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RAE, the Regulatory Authority for Energy, is close to finalizing legal framework for CNG supply to remote parts of Greece not served by the existing pipeline network.

The authority still needs to determine whether the responsibility of grid operators will be limited to compression and decompression procedures, which would leave transmission matters for suppliers to handle, or whether the operators will be responsible for all three stages – compression, transportation and decompression.

If the first of these two options is chosen, then grid operators will need to develop facilities installed with equipment such as decompressors and meters. Gas suppliers would be offered unlimited access to these facilities for their respective storage and transportation needs.

The second option, making grid operators fully responsible for compression, transportation and decompression, would protect consumers in remote areas from being overcharged for CNG supply as the related costs would be spread through the wider distribution network.

RAE official Nektaria Karakatsani, in a recent article, noted that the new framework being prepared for CNG supply to remote parts of Greece shares similar traits to the socially-minded policies applied in the electricity market.

“As is commonly known, the objective in the case of electricity is to maintain a single price throughout Greece, despite the high costs of energy production on the non-interconnected islands,” the RAE official noted.

The shape of the CNG supply plan to remote areas will depend on a number of factors, including the proximity of areas from existing networks as well as the consumption potential of specific areas.

The details of proposals forwarded to RAE by the country’s three operators do differ but all share common investment potential, Karakatsani, the RAE official, pointed out.

All three proposals would require construction of a new low-pressure network measuring 1,600 km, while over 100,000 new consumers, overall, are expected to connect to the network, the official added.

 

 

 

Alternative car fuel infrastructure development lacking support

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Just 3.5 percent of vehicles in Greece, including hybrid models, run on alternative fuels, according to data concerning 2016, released by the country’s infrastructure, transport and networks ministry.

As for electric vehicles, at least 395 were used in 2016, while just three approved and publically accessible electric vehicle charging stations existed last year.

According to ELINHO, the Hellenic Institute of Electric Vehicles, at least 43 electric vehicle charging stations have been installed, primarily for private use, at parking facilities.

Authorities have forecast that at least 3,500 electric vehicles will circulate in Greece in 2020, while the figure is expected to increase to 8,000 in 2025 and 15,000 in 2030.

The ministry report noted that 11 fuel stations offer both CNG and gasoline, while a further five are expected to soon open in Athens and Thessaloniki. Licensing and construction procedures are current in progress for these.

The number of conventional fuel stations selling gasoline and diesel has contracted to 5,500 amid the extended recession. Of these, 800 also offer LPG.

Authorities forecast that the number of CNG-fuled vehicles in Greece will grow ten-fold by 2020, while, by 2025, this category is expected to represent 0.5 percent of the country’s total fleet, the average level on an international scale.

The ministry pointed out that a considerable number of new publically accessible electric vehicle charging stations will need to be developed by the end of 2020 to facilitate the expected growth.

The number of CNG stations – private and public – in Greece is expected to grow to 25 in 2020, 41 in 2025 and 65 in 2030, which is regarded as insufficient. LNG station growth forecasts are even more subdued.

No investment support plans exist at present for the development of private-sector alternative fuel infrastructure as the ministry is operating on a limited budget.

EDA THESS placing emphasis on CNG for market growth

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The recently formed gas distribution company EDA THESS, established to serve the wider Thessaloniki and Thessaly regions, is placing emphasis on CNG (compressed natural gas) development to initially cover areas detached from the grid, general manager Leonidas Bakouras noted yesterday in his presentation of the enterprise’s five-year development plan, covering 2017 to 2021, at the Athens Energy Gas Forum, organized by TEE, the Technical Chamber of Greece.

These areas, in Greece’s midlands and north, may be supplied CNG through the development of networks beyond compressor stations, Bakouras informed.

A supply capacity of between 70,000 and 100,000 cubic meters will be aimed for during the first few years and could grow to 500,000 to 600,000 cubic meters, annually, as a result of local network development.

EDA THESS aims to supply CNG to these detached areas as a means of facilitating a natural gas penetration plan before developing networks, if sustainability is assured.

 

 

 

 

DEPA to soon acquire 13 new CNG stations, co-funded by the EU

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DEPA, the Public Gas Corporation, will soon acquire thirteen new CNG stations at ten existing liquid fuel facilities following approval of the project’s induction into an EU funding mechanism, the CEF (Connection Europe Facility).

The Greek finance ministry yesterday announced the inclusion, into the CEF, of a Greek “Study on a pilot CNG fueling station network across the Greek part of the Orient East Mediterranean Road Corridor”.

The ten exisiting liquid fuel units, where the CNG systems will be developed, are located in Larissa, Thebes, Alexandroupoli, Igoumenitsa, Patras, Kozani, Kiato, Ioannina, Xanthi and Serres.

DEPA had submitted an application for this project as a collaborative effort with One Team, Optilog and Lever.

The project’s budget is valued at 9.1 million euros, half of which will be covered by the CEF funding mechanism.

The CEF funds projects in the fields of transportation, energy and telecommunications.

EPA Attiki prepares for low-cost CNG supply in liberalized gas market

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EPA Attiki intends to supply CNG to major-scale industrial enterprises and businesses, a plan that will be made possible by the installation of compressors to the existing low and medium-pressure network, EPA general manager Yiannis Mitropoulos disclosed yesterday while addressing the many opportunities offered by the gas market’s developing liberalization.

EPA Thessaloniki and EPA Thessaly are also considering installing compressor stations to enable CNG supply to the market.

The EPA Attiki general manager pointed out that his company’s plans are focused on CNG supply, not LNG. Compared to LNG, requiring a costly liquefaction procedure, CNG is a lower-cost option once compressors have been installed.

The developing liberalization of the natural gas market will be completed as of January 1, 2018, when households will be free to choose supplier. Industrial clients were able to do so as of the beginning of 2016, while major-scale business customers were offered this right at the beginning of this year.

“Opportunities exist and will proliferate as the market continues to become increasingly liberalized and the arrival of 2020, when the TAP pipeline will be launched, draws nearer,” Mitropoulos noted. “We are already assessing alternative supply sources,” he continued.

Originally founded by parent company DEPA, the Public Gas Corporation, as a supply subsidiary covering the wider Athens area, EPA Attiki has now gained independence amid the gas market reforms. EPA Attiki’s initial objective, in its new life, is to enter the retail electricity market and follow up this entry by improving its services in anticipation of intensifying competition.

Mitropoulos said he expects household natural gas price levels to drop over the next few months. Price levels are currently at 5.7 cents per MWh, seven percent higher than in January, as a result of the energy crisis early this year. Despite the recent rise, household natural gas price levels remain 38 percent lower than heating fuel.

EPA Attiki has set itself an annual turnover target of 150 million euros for 2017.