IPTO’s Ariadne Interconnection minority share offer resurfaces

Power grid operator IPTO has reopened the prospect of making available to investors a minority stake in its subsidiary Ariadne Interconnection, established for the development of the Crete-Athens interconnection.

The possible sale essentially remained stagnant during a recent period of administrative changes at RAE, the Regulatory Authority for Energy.

Ariadne Interconnection has been commissioned the project’s construction IPTO but will cease to be involved in any way once the project is delivered to the operator for operation.

IPTO’s administration reminded RAE, in a letter forwarded just days ago, about a concession agreement it has signed with Ariadne Interconnection, offering a detailed description of the relations between the two companies for the Crete-Athens grid interconnection project.

The project was originally planned to be a segment of a wider interconnection plan to link the Greek, Cypriot and Israeli electricity grids, with EuroAsia, a consortium of Cypriot interests, at the helm, before IPTO withdrew the Crete-Athens section for its development as a national project.

IPTO has noted a minority partner in Ariadne Interconnection could be offered a stake of up to 40 percent.

China’s SGCC, a strategic partner of IPTO holding a 24 percent stake, informed, some time ago, that it wants to acquire a 20 percent stake of Ariadne Interconnection. European operators such as Belgium’s Elia and France’s RTE, as well as major investment groups have also indicated they would be interested.

 

Crete-Peloponnese subsea cable installation to start soon

Power grid operator IPTO plans to begin installing a 135-km subsea cable for the Peloponnese-Crete grid interconnection, part of a larger project to ultimately extend this line to Athens, within the next few weeks. The installation’s exact starting date will depend on the weather conditions.

Also, a subsea cable interconnecting the islands Naxos and Syros, the final step in the third phase of the Cyclades grid interconnection, is expected to be electrified next month, according to the operator.

The Peloponnese-Crete project, in particular, is pivotal in the effort to reduce public service compensation (YKO) surcharges for consumers. The interconnections will also help utilize the renewable energy potential of islands.

The Peloponnese-Crete subsea cable installation, made challenging by deep waters reaching 1,000 meters, will require about two months to complete, IPTO sources noted. It will be the world’s longest subsea cable grid interconnection.

Installation work for a second subsea cable (107 km, 150 kV) between Syros and seaside Lavrio, on the southeastern tip of the wider Athens area, was completed last month in preparation for the electrification of the Naxos-Syros line, expected early October. High-voltage testing, over a 24-hour period, will precede the line’s electrification.

IPTO, Ariadne agreement details partnership for Crete link

Power grid operator IPTO has signed a concession agreement with its fully owned subsidiary Ariadne Interconnection detailing their relationship for the Athens-Crete grid interconnection project, energypress sources have informed.

The agreement was prepared with assistance from legal and consulting firms to overcome concerns raised by RAE, the Regulatory Authority for Energy, following a decision by Greek authorities to develop this interconnection as a national project and not as part of the wider EuroAsia project planned to link the Greek, Cypriot and Israeli power grids.

RAE will now assess the concession agreement’s details and make observations, if needed, before procedures commence to bring investors into Ariadne Interconnection for a minority share.

The details of this entry procedure still remain unclear but the energy minister is expected to clarify through related legislation.

One of the ambiguities concerns whether large-scale RES projects on islands will be able to reserve IPTO interconnection capacities.

The Copelouzos group and Terna, for instance, maintain investment plans for Crete. If given the green light by the energy ministry, they will reserve capacities for the Athens-Crete interconnection, provide funds accordingly and be given corresponding stakes in Ariadne Interconnection.

Investors are expected to acquire up to 40 percent of Ariadne Interconnection, according to the IPTO board.

Chinese company SGCC, IPTO’s strategic partner with a 24 percent, has already expressed an interest to acquire a 20 percent stake in Ariadne Interconnection. Other interested parties include European operators, among them Belgium’s Elia and France’s RTE, as well as prominent financial groups possessing major investment portfolios.

Cyprus wants unchanged cost agreement for link with Crete

Though a new application submitted by EuroAsia Interconnector, a consortium of Cypriot interests, to the EU’s Connecting Europe Facility for funding support concerning an electricity grid interconnection project to link the Greek and Cypriot systems has yet to be examined or reciprocated by the European Commission, Greece and Cyprus have already begun talks on how to divide the remainder of the project’s costs not covered by the CEF.

The Cypriot side, which took the initiative for these talks, appears determined to ensure that Greece will stick to its share of the cost under the terms agreed to when the project also included the Athens-Crete link as part of a wider plan to interconnect the Greek, Cypriot and Israeli systems.

EuroAsia Interconnector head the wider Greek-Cypriot-Israeli plan. Greek power grid operator IPTO withdrew the Athens-Crete segment and is now working on it as a national project. IPTO is aiming for swifter progress on this section, urgently needed to resolve Crete’s pressing energy sufficiency issues.

Cyprus’ Regulatory Authority for Energy, RAEK, has forwarded to its Greek counterpart RAE a text presenting its cost-related views. RAEK wants to ensure that a Cross Border Cost Allocation agreement signed by the two sides late in 2017 for the Greek-Cypriot link, running from Crete to Cyprus, remains valid, despite Greece’s withdrawal of the Athens-Crete section.

According to the CBCA agreement, Cyprus will take on 63 percent of the cost of the Crete-Cyprus link and Greece will be responsible for the other 37 percent, under the condition that 50 percent of the total cost will be covered by EU funds, through the CEF.

The Crete-Cyprus interconnection is budgeted at 1.5 billion euros, meaning Greece’s share will be approximately 280 million euros.

This amount will be incorporated into IPTO’s accounts and need to be recovered through network surcharges included in consumer electricity bills, seen as a delicate matter by the Greek government.

Greek authorities have yet to respond to RAEK’s initiative as they await news from the European Commission on the CEF request.

PPC, Terna, Copelouzos resume talks for Crete RES partnership

Power utility PPC has resumed talks with Terna Energy and the Copelouzos group for a consortium to develop RES projects on Crete, but work is still needed if institutional complications are to be resolved.

The plan’s viability will depend on whether the consortium – if formed – can secure a contract with power grid operator IPTO to ensure a capacity reservation in the prospective Crete-Athens grid interconnection.

Approximately three years ago, Terna Energy and the Copelouzos group decided to merge two respective wind-energy projects covering Crete’s four prefectures, which took their combined capacity total to 950 MW, in order to facilitate an EU funding effort.

PPC also entered the picture just months ago, prior to the pandemic’s outbreak, for talks on the establishment of a three-member consortium. PPC Renewables, a PPC subsidiary, possesses wind-energy capacity on Crete.

The prospective venture planned by the trio entails transmission and sale to the mainland of 1 GW generated by wind-energy facilities. Each partner would hold a 33.3 percent stake in this venture.

 

 

Committee to oversee Greece, Cyprus, Israel grid link compatibility

Greek power grid operator IPTO, its Cypriot counterpart, DSMK, and project partners have been authorized by the energy ministries of the two countries to assemble a special committee tasked with ensuring technical compatibility between the prospective Athens-Crete grid interconnection and the planned Cypriot and Israeli links.

The Athens-Crete grid interconnection, work on which is set to begin, will be developed by IPTO subsidiary Ariadne Interconnector, following the Greek grid operator’s break away from Cyprus’ EuroAsia Interconnector, originally formed to oversee the entire interconnection project, from Greece to Israel, but now handling its Cyprus and Israel segments.

The Greek and Cypriot energy ministries have asked IPTO, DSKK, Ariadne Interconnector and EuroAsia Interconnector to assemble the special committee within the next fortnight.

Greece’s energy ministry is determined to contribute to all efforts resolving any technical issues for the wider Greek-Cypriot-Israeli interconnection but development of the Athens-Crete section, nationally significant as it promises to prevent energy shortages on Crete, remains the ministry’s main concern at this stage, sources informed.

The Greek government is providing strong political support to the Crete-Cyprus and Cyprus-Israel segments, the energy ministry’s secretary-general Alexandra Sdoukou has pointed out, noting Cyprus’ grid interconnection with the rest of the EU promises to help the country achieve RES objectives set for 2030.

IPTO in talks with investors, operators for Crete interconnection

Investors – funds and major operators – are believed to be expressing strong interest for a minority stake in power grid operator IPTO’s subsidiary Ariadne Interconnection, the project developer of the Athens-Crete electricity grid interconnection.

Talks with parties interested in an Ariadne Interconnection stake have commenced, the power grid operator’s deputy chief Yiannis Margaris informed media during a press call for a presentation of the company’s annual financial results.

Prospective Ariadne shareholders must be financially robust, well acquainted with energy-sector matters, and focused on long-term investments, Margaris pointed out, setting terms and conditions.

The operator is focusing its search on big groups with portfolios carrying major investments, the deputy said.

IPTO’s administration is already engaged in talks with European operators such as Belgium’s Elia and French operator RTE, Margaris indicated.

IPTO expects to sign a bank loan agreement this month for an amount between 400 and 500 million euros to help finance the Athens-Crete interconnection. A sum stemming from Ariadne’s cash reserves worth 200 million euros and National Strategic Reference Framework (NSRF) funds of between 300 and 400 million euros are also expected to contribute.

The Athens-Crete link project is set to start and all the funds must be in place, IPTO officials said.

The possible involvement in Ariadne of investors will help achieve better borrowing terms, the officials added, while stressing the two procedures – search for a minority shareholder and capital – are moving ahead independently of each other.

Talks are also in progress with investors for island interconnections to facilitate RES projects, Margaris said.

Gov’t moves promise progress for Athens-Crete grid link

The government has taken key initiatives to facilitate progress of the Crete-Athens electricity grid interconnection project, vital for the island’s energy sufficiency following the compulsory withdrawal of high-polluting power stations.

A decision was reached yesterday at a cabinet meeting headed by Prime Minister Kyriakos Mitsotakis to induct this project into a code making the expropriation of property compulsory.

Prior to this, early in April, government officials delivered the project’s environmental terms.

The latest move, offering expropriation rights, enables work to progress before compensation amounts have been determined and paid out to displaced property owners.

However, in return, the Greek State must apply for temporary or final determination of compensation within one month.

Officials at power grid operator IPTO, developing the project, have embraced the government decisions as they promise to prevent delays for this ambitious and challenging grid interconnection.

Large-scale projects such as the Crete-Athens grid link cover areas administrated by successions of local authorities. Subsequently, overall project progress greatly relies on the swift issuance of licenses by local authorities.

As the next step, the winning bidders of cable installation work are expected to sign project contracts in May. The signing of contracts for the development of terminal stations is anticipated in the first half of June.

IPTO, Ariadne roles for Crete link project clarified to avoid complications

Power grid operator IPTO, guided by consultants and legal experts, has prepared a concession agreement clarifying the roles of the operator and its subsidiary firm Ariadne Interconnection in the development of the Athens-Crete electricity grid interconnection. This is needed to avoid future complications in Brussels.

The concession agreement makes clear Ariadne Interconnection’s involvement in the venture is limited to the development stage, noting the subsidiary firm will not maintain any operational or management interests once the project is delivered to IPTO for operation.

RAE, the Regulatory Authority for Energy, has warned that any managerial involvement in the project by a company such as Ariadne Interconnection, not a certified operator like its parent company, will lead to complications at the European Commission and could delay the project, to be developed as a national project, not a PCI project promising EU funds.

RAE’s concerns are made more acute by the prospect of Ariadne Interconnection’s prospective split from IPTO as part of a procedure to offer a minority stake to third parties. Ariadne Interconnection is currently a fully-owned IPTO subsidiary.

Clarification on the project roles of IPTO and Ariadne Interconnection will enable Ariadne Interconnection to seek minority shareholders.

IPTO has noted a 40 percent stake of Ariadne Interconnection will be offered to investors to help finance the project without the burden of bank loans.

State Grid Corporation of China (SGCC), IPTO’s strategic partner with a 24 percent stake, has expressed an interest to acquire a 20 percent stake in Ariadne Interconnection.

IPTO island links over next 10 years to offer 2.6 GW capacity

Power grid operator IPTO’s interconnections planned for the next decade will prepare the ground for new island-based RES projects representing a total capacity of 2.6 GW.

The operator’s ten-year national electricity grid development plan for 2021 to 2030, forwarded to RAE, the Regulatory Authority for Energy, for approval, offers major investment opportunities in the renewable energy sector.

Wind and solar energy farms operating on islands will be able to transmit their output to the mainland via underwater cables.

The IPTO ten-year plan offers a RES project installation capacity of 2,442 MW for Crete, the Cyclades, the Dodecanese and the northeast Aegean islands. This capacity represents potential investments estimated at 2.6 billion euros.

The completion of all four phases of the Cyclades interconnections, scheduled for the second half of 2024, will offer 332 MW for this region. Andros and Tinos will have a RES installation capacity of 72 MW, the capacity for Syros, Paros, Mykonos and Naxos will total 160 MW, while Santorini, Folegandros, Milos and Serifos will be offered a 100-MW installation capacity.

The completion of Crete’s small-scale mainland interconnection to the Peloponnese, scheduled for the second half this year, will offer a RES installation capacity of 160 MW. A further 600 MW will be added once the island’s major-scale interconnection to Athens is completed in 2023, when Crete’s wind and solar energy capacity total of new and existing RES projects is expected to reach 1,080 MW.

The RES expansion capacity on the Dodecanese and northeast Aegean islands will reach 1,030 MW, according to the IPTO ten-year plan. Samos, Chios and Lesvos will be offered a 360-MW share of this total; Limnos, Kos, Rhodes and Karpathos will get 570 MW, while Skyros will be offered the remaining 100 MW.

The grid interconnections in the island regions will be developed over three phases to be respectively completed in 2027, 2028 and 2029, according to the IPTO plan.

 

Work on Crete-Athens grid link nears launch after approvals

The Court of Auditors has approved contracts offered to winning bidders for installation of the Crete-Athens grid interconnection’s four cable segments, enabling the signing of contracts for the one billion-euro project’s biggest stage, budgeted at 615 million euros, probably within the month, energypress sources have informed. Work will then be able to commence.

Prysmian, Nexans and Hellenic Cables-NKT were awarded contracts for the project’s four cable segments. Prysmian secured two of these four contracts.

On another front, the Court of Auditors is expected to approve a contract for the project’s other key stage, the design, supply and installation of two converters and a substation, in June, according to sources.

Siemens – Terna, a member of the GEK TERNA group, submitted an improved bid of 370 million euros late last month to be awarded this contract by power grid operator IPTO’s fully-owned subsidiary Ariadne Interconnection, the project promoter.

The Court of Auditors’ approval of contracts for the project’s four cable segments follows a recent decision by the environment and energy ministry endorsing the 1,000-MW project’s environmental terms.

EU funding for the project through the NSRF (2014 – 2020) is expected to be approved within the next week to ten days, according to reliable sources. This would subsequently also offer IPTO access to bank financing.

Siemens-Terna awarded converter stations contract for Crete-Athens link

Power grid operator IPTO’s fully-owned subsidiary Ariadne
Interconnection has successfully completed a tender process for the Converter Stations of the Crete-Athens Interconnection, awarding the contract to Siemens – Terna, a member of the GEK TERNA group, ADMIE (IPTO) Holding has announced. 

After the submission of an improved bid on March 26, the contract price was set at 370 million euros, of which 358.6 million euros concern the construction of the converter stations. The remaining 11.4 million euros concern maintenance of these stations.

The contract calls for a 36-month implementation period and will be signed after approval by the Court of Auditors.

The project will be included in the list of the Operational Program “Competitiveness, Entrepreneurship and Innovation” of the NSRF 2014 – 2020.

Τhe tendering procedure for the design, supply and installation of two Converters and a Substation for the DC Electrical Interconnection between Crete and Athens was launched on May 24, 2019.

The tender attracted the interest of world leaders in the industry and on November 1, 2019 the GE-Nari-Mytilineos and Siemens-Terna consortiums submitted binding offers.

The evaluation of the offers submitted by the consortiums, both of which possess strong technical backgrounds and specialized experience in similar projects abroad, required more than four months due to the project’s elevated technical demands. 

The technical evaluation was completed on March 13 and the Siemens-Terna consortium’s offer qualified, taking into account all relevant issues related to the interconnection.

Commenting on the tender, the IPTO group’s CEO Manos Manousakis noted: “During these challenging times, the tender process for our
flagship project, amounting to 1 billion euros, was successfully completed without problems.
IPTO will continue to focus all its efforts in order to protect the timely implementation of the project and ensure the safe and reliable power supply of Crete through the mainland system by 2023. Apart from the economic benefits of the interconnection of Crete for all Greek consumers, through the decline of Public Service Obligations (PSO), the implementation of this
project paves the way for accelerated RES integration on the island based on the principles of sustainable development.”

IPTO in talks with financial institutions for Crete link loan

Power grid operator IPTO is currently involved in talks with local and foreign financial institutions for a loan concerning Crete’s major-scale electricity grid interconnection with Athens, a project budgeted at around one billion euros.

IPTO chief executive Manos Manousakis is looking for a project loan of roughly 400 million euros. Talks, so far, with financial institutions, including the EBRD, according to sources, are believed to have made good progress.

Financial institutions contacted so far appear positive on the prospect of  providing financing for the Crete-Athens interconnection but want WACC level and cost-benefit study assurances.

IPTO anticipates financing for the project from three sources, including the 400 million-euro bank loan.

The operator has already allotted 200 million euros for subsidiary firm Ariadne Interconnector, the project promoter. IPTO also expects between 350 and 400 million euros to come from the EU’s National Strategic Reference Framework (NSRF).

A new regulatory framework for the grid interconnection as a national project rather than a PCI project is a significant pending issue that also needs to be resolved.

RES auction to offer 200 MW for Cretan wind, solar energy projects

RAE, the Regulatory Authority for Energy, is preparing to stage a RES auction for new renewable energy facility installations on Crete in anticipation of the island’s grid capacity increase to result from new interconnections with the mainland.

The authority intends to offer 100 MW for wind energy facilities and a further 100 MW for solar energy projects, all at a starting price of 30 euros per MWh.

Crete is rated as an area of very high RES potential, especially for wind and solar projects. These favorable conditions support further renewable energy development at the lowest possible cost and minimum burden on consumers.

Crete’s energy security has developed into a major issue and national priority as a result of the implementation of strict EU carbon emission limits requiring the withdrawal of high-polluting units as of the end of 2020.

 

Crete link environmental terms, needed for contracts, soon

The energy ministry will publish the environmental terms for Crete’s major-scale grid interconnection with Athens, needed for project contracts, within the first ten days or March, power grid operator IPTO, the project’s promoter, anticipates.

The delivery of these terms will enable the winning bidders for the project’s cable installations, Prysmian, Nexans and Hellenic Cables – NKT, to sign project contracts with the operator, probably two to three weeks later, somewhere between late March and early April.

Meanwhile, appraisals of offers submitted by bidders for project converter stations are believed to be nearing completion. Two consortiums, Terna-Siemens and Mytilineos-General Electric-Nari have submitted offers to the tender for converter stations.

Construction of the major-scale grid interconnection, from Crete to Athens, will be able to commence once the cable and converter station contracts have been signed.

IPTO insists the project will be fully operational in 2023.

Work on Crete’s small-scale grid interconnection with the mainland, from Crete to the southern Peloponnese, is progressing as scheduled, IPTO has informed.

The installation of this segment’s submarine cables, awarded to Prysmian and Hellenic Cables, is scheduled to be completed around November, according to IPTO’s schedule.

This segment involves deep-sea cable installation work at more than 1,000 meters below sea level, an effort said to be unprecedented anywhere in the world.

Swift solution needed for Crete link project’s local resistance

The energy ministry is working to overcome resistance raised by regional authorities in Crete against the installation of a converter station needed for a submarine electricity grid interconnection project to link the island with Athens.

Cretan regional authorities have delivered a negative report on a plan by power grid operator IPTO, the project’s promoter, to install a converter station at Damasta in the Heraklion province.

The ministry needs to resolve the issue in order to issue an environmental permit for the interconnection project. The project’s completion target of 2023 could be threatened if this issue is not swiftly resolved.

A new round of talks involving top-ranked officials at the energy ministry and RAE, the Regulatory Authority for Energy, and Cretan regional authorities could be held during the current week. Alternative solutions and offsetting measures that would compensate locals for any negative impact caused by the project are expected to be discussed.

IPTO appears set to sign an agreement with Prysmian, Nexans and Hellenic Cables – NKT, the winning bidders in a tender for the project’s cables. However, the pending environmental permit is needed.

Technical aspects of bids submitted to another project tender concerning two other converter stations and a substation are currently being assessed. Two consortiums, Terna – Siemens and Mytilineos – General Electric – Nari submitted bids for this tender.

Its next stage, an assessment of financial offers submitted by the aforementioned participants, will be made early in the year, Ariadne, an IPTO subsidiary formed for the Cretan interconnection project, has informed.

Copelouzos, Terna, PPC in Crete wind energy talks

Power utility PPC is engaged in talks with the Copelouzos and Terna Energy groups for the establishment of a joint venture to operate Cretan wind energy parks with a total capacity of approximately 1,000 MW.

The trio also intends to secure capacity in the Crete-Athens grid interconnection once this project, being developed by power grid operator IPTO, has been completed.

Details being discussed include the prospective stakes each of the three companies in the common venture. An even split of 33 percent each is one of the options being considered.

Two major Cretan wind energy projects being developed by Terna Energy and the Copelouzos group’s Elika were merged in 2017 to simplify their respective financing procedures through the European Fund for Strategic Investments (EFSI), commonly known as the Juncker Package.

These wind energy parks, promising an overall capacity of approximately 950 MW, will be developed in four prefectures.

PPC’s involvement, if an agreement with Copelouzos and Terna Energy is reached, could offer the power utility a 330-MW capacity.

Besides the current talks with Copelouzos and Terna Energy, PPC has received over ten partnership offers by Greek and foreign firms over the past few months.

The power utility recently signed three Memorandums of Understanding for strategic partnerships in the renewable energy sector, including one with Masdar Taaleri Generation (MTG) concerning a 300-MW capacity.

Ariadne Interconnector minority stake tender early in 2020

A tender to offer one or two prospective partners minority stakes in Ariade Interconnector, the SPV established by power grid operator IPTO for the development of the Athens-Crete electricity grid interconnection, is expected to be staged within the first few months of 2020.

Both the energy minister Costis Hatzidakis and IPTO chief executive Manos Manousakis anticipate common ground will soon be found with RAE, the Regulatory Authority for Energy, to enable the tender to go ahead.

State Grid Corp of China (SGCC) appears willing to participate in the tender. The Chinese company, already holding a 24 percent stake of IPTO, has expressed interest to acquire 20 percent of Ariadne. A related memorandum guaranteeing SGCC’s involvement, has been signed between SGCC and IPTO.

If SGCC’s interest in Ariadne is limited to 20 percent, then a second package, most probably offering an additional 19 percent, will be offered to investors for a total of 39 percent.

This is the Ariadne Interconnector stake that had been planned for EuroAsia, a consortium of Cypriot interests that has opposed IPTO’s decision to appoint Ariadne, a subsidiary firm, as project promoter of the Athens-Crete electricity grid interconnection.

Euroasia, heading a consortium formed for a wider PCI-status interconnection project to link the Greek, Cypriot and Israeli grids, has sought control of the Crete-Athens segment’s development.

If SGCC expresses an interest for an Ariadne stake bigger than 20 percent, then just one package offering 39 percent will be offered through a tender.

IPTO is determined to keep a majority stake in its subsidiary Ariadne as the operator wants to maintain control over the construction stage of the Athens-Crete link, to be managed by the operator once launched.

Investors, especially from abroad, are expected to show strong interest in Ariadne.

The IPTO administration is also looking to offer minority stakes to investors in other projects it is developing. This would secure further financing support and swifter completion.

SGCC interested in additional IPTO stake, Crete grid link role

The chief official at State Grid Corp of China (SGCC) is expected to officially express interest for an additional stake in Greek power grid operator IPTO as well as an entry into its subsidiary Ariadne, project promoter of the planned Crete-Athens electricity grid interconnection.

Wei Kou, the SGCC chairman, is scheduled to hold a meeting with Greek energy minister Costis Hatzidakis in Athens today.

The Chinese official is part of a visiting Chinese delegation spearheaded by President Xi Jinping. The group arrived yesterday.

The energy ministry has known about SGCC’s interest in both matters for quite some time now.

In July, Hatzidakis, the energy minister, had announced a government intention to further privatize IPTO. SGCC already holds a 24 percent share.

Ensuing reports on the additional IPTO stake that could be offered by the Greek government have ranged between 20 and 30 percent.

As for the Crete-Athens grid link, needed to resolve a looming energy shortage threat on the island, SGCC’s right to become involved is unclear. The European Commission needs to clarify whether the subsidiary of a certified operator – in this case, Ariadne – can develop national grid projects if third parties have entered as shareholders.

Quite clearly, the Greek government is keen on further energy sector collaborations with China. Athens, however, will need to move with particular care and abide by stricter EU rules concerning Chinese investments in European sectors of strategic importance.

Ariadne third-party investors a problem for Crete grid link

Crete’s major-scale electricity grid interconnection with Athens, now entering its next phase following a government decision to not develop the link as a national project, meaning the project will not be included on the EU’s new PCI list, faces subsequent administrative and financing complexities.

Ariadne, as a fully-owned subsidiary of power grid operator IPTO, is entitled to develop this national electricity transmission project, but appears to lose the right should third parties enter its equity make-up as partners.

IPTO wants investors to take on a minority stake of up to 49 percent in Ariadne as a means of avoiding bank loans for the project’s development.

If third parties enter Ariadne’s make-up as shareholders, then the subsidiary will need to be re-certified as operator based on its new line-up. A second alternative would require RAE, the Regulatory Authority for Energy, to stage the competitive procedure to bring new investors into Ariadne.

Both options would be time-consuming, which is a major concern given the urgency of this project, needed to prevent looming energy shortages on Crete.

The energy ministry, fully informed on the complexities to be created by third-party entries into Ariadne’s line-up, is expected to soon seek further clarification on the matter from the European Commission.

One of three Crete link bidding teams wants time or will exit

ABB, the world’s biggest developer of power grid interconnection projects, has requested a further deadline extension greater than the one-month periods of additional time already granted twice for a tender concerning the Crete-Athens grid interconnection project’s engineering, procurement and construction of two converter stations and a GIS substation, energypress sources have informed. The tender’s current deadline is set to expire on October 31.

Both the Greek government and power grid operator IPTO appear determined not to accept any further deadline extension requests as this, they believe, would increase the risk of a project delay and, consequently, energy sufficiency issues on Crete.

Outdated, high-polluting power stations still operating on Crete soon need to be withdrawn.

ABB, which has joined forces with Greek maritime infrastructure construction and maintenance group Archirodon for the Cretan project’s tender, has cited the complexity of the project for the additional time the company appears to need. If a sizable extension is not granted, then ABB and project partner Archirodon will most likely withdraw from the tender, it is believed.

On the contrary, two other partnerships established for the tender, according to reliable sources, are preparing to submit their offers. Siemens is believed to have joined forces with Greek construction company TERNA and General Electric is working with Greece’s Mytilineos, according to sources.

The grid interconnection project’s development faces a tight schedule. IPTO chief executive Manos Manousakis told a recent conference the project will be launched early 2023, not at the end of 2022, as was previously believed.

PPC wants cost coverage for Crete energy sufficiency moves

Power utility PPC is unwilling to move ahead with measures required to ensure energy sufficiency on Crete between 2020 and 2023 – the period during which the island’s major-scale electricity grid interconnection with Athens is planned to be developed – unless it is assured cost coverage for these actions through public service compensation (YKO) surcharges included on electricity bills.

Various measures deemed necessary by a National Technical University of Athens (NTUA) study have yet to be implemented.

On the contrary, various issues keep surfacing. Just recently, PPC informed there is not enough time to convert a diesel-fueled unit at Atherinolakkos into a gas-fueled facility by next summer. All of the island’s high-polluting diesel-run units must be withdrawn by the end of this year.

PPC wants the cost of unit conversions, natural gas orders, as well as take-or-pay clauses that may be attached to gas supply agreements covered by the public service compensation surcharge.

Besides representing part of the overall solution for Crete’s energy sufficiency between 2020 and 2023, the plan to convert old lignite units to gas-fueled facilities also promises to serve as a long-term solution.

The NTUA study for Crete also proposes the installation of a new 100-MW unit, preferably gas fueled; development of new RES facilities with a total capacity of between 100 and 150 MW; and the installation and incorporation into the grid of energy storage systems (high-tech batteries) with a capacity of 30 to 40 MW.

PM decision on Crete link, wider PCI plan support needed today

Negotiations ran throughout the day until late last night as all sides involved sought to determine if an agreement is possible on the prospective Crete-Athens power grid interconnector and whether the wider Athens-Crete-Cyprus-Israel interconnection, an EU project of common interest (PCI), remains feasible under the current conditions.

Greek Prime Minister Kyriakos Mitsotakis must inform the European Commission  today on whether Athens supports the wider PCI project, a stance that would incorporate the Athens-Crete segment, or pursue this segment separately as a national project.

A European Commission PCI committee is meeting today to discuss the EU’s new PCI list for the next two years.

Greek power grid operator IPTO has been embroiled in a dispute with Cypriot consortium EuroAsia Interconnector over development control of the wider project’s Crete-Athens segment. EuroAsia Interconnector heads the wider project and has been joined by Elia, Belgium’s electricity transmission system operator, in a strategic alliance.

The Cypriot side entered yesterday’s negotiations with a slightly improved offer but the Greek side still considers it insufficient for constructive talks.

The Greek government has set red lines for the Athens-Crete segment, including no further delays for ongoing tenders offering converter station contracts, which effectively means technical term revisions will not be accepted. Greek officials insist compatibility for the wider project is ensured.

Gov’t making last-ditch effort for Cypriot deal on Crete grid link

The government, determined to move ahead with the country’s grid interconnection projects in support of economic and environmental concerns, is making a final effort to establish cooperation between Greek power grid operator IPTO and Cypriot consortium EuroAsia Interconnector, at odds for development control of a grid project to link Crete with Athens.

The EuroAsia Interconnector consortium heads a wider PCI-status project to link the Greek, Cypriot and Israeli grids.

“We need to have made decisions by October 4. Grid Interconnections are a priority for environmental and economic reasons,” energy minister Costis Hatzidakis stressed yesterday, speaking at a conference staged by the Hellenic Entrepreneurs Association (EENE).

The government is seeking to make the most of ongoing visits to Greece by Cypriot minister of energy, commerce industry and tourism Giorgos Lakkotrypis and former foreign minister Ioannis Kasoulides, now Euroasia Interconnector’s Chairman of the Strategic Council.

The Greek energy ministry has not ruled out an agreement with Euroasia Interconnector for the Crete-Athens grid link but has made clear swift development of the project is the top priority. A Greek-Cypriot-Israeli grid interconnection is still desired by the Greek government but the Cretan link is seen as even more crucial, Hatzidakis, the energy minister, is insisting, according to sources.

Euroasia Interconnector and the European Commission have requested the cancellation of a decision by RAE, the Regulatory Authority for Energy, awarding the Cretan project to Ariadne, a fully-owned IPTO subsidiary. This would delay progress.

“The only remaining prospect for cooperation would require Euroasia to provide the needed capital for a stake in Ariadne. But the Cypriot consortium appears unwilling or unable to do this,” an official deeply involved in the matter has informed.

The Cretan grid link project will be continued as a national project if current talks with the Cypriot side do not lead to any agreement, sources informed. If so, the Greek government is expected to deliver a pending reply to Brussels making clear that it does not support the entire Athens-Crete-Cyprus-Israel project.

Meanwhile, prospective bidders of a tender concerning the Crete-Athens grid interconnection project’s engineering, procurement and construction of two converter stations and a GIS substation have been given a further deadline extension. An initial August 30 deadline had been reset for September 30 before the latest extension.

Crete-Athens link tender set for further deadline extension

A tender concerning the Crete-Athens grid interconnection project’s engineering, procurement and construction of two converter stations and a GIS substation will be given a further deadline extension, possibly an entire month, as a result of requests made by major prospective bidders.

An initial August 30 deadline was reset for September 30 and may now be extended to October 30.

Project promoter Ariadne, a subsidiary of Greek power grid operator IPTO, has made clear to the tender’s participants the latest deadline extension will be the last as any further delays would place at risk the project’s completion on time. This would have repercussions as the project is vital for Crete’s energy sufficiency.

The latest extension is not linked to a legal challenge made by EuroAsia, a consortium of Cypriot interests heading a wider PCI-status project to link the Greek, Cypriot and Israeli grids, sources noted. Nor is it any way linked to a pending Greek government response to the European Commission on whether the Crete-Athens interconnection will be supported by Greece as part of the wider PCI project or as a national project, the sources added.

Some of the companies interested in the Crete-Athens link tender have confirmed requesting a new deadline extension.

This tender was preceded by an initial tender concerning the project’s cable segments. Appraisals of the technical aspects of offers will be completed by the end of this month, according to IPTO chief executive Manos Manousakis, while assessments of the financial offers will follow.

Time insufficient for Crete diesel units switch to gas, will cost

Power utility PPC has admitted it does not have enough time to convert old, high-polluting diesel-fueled power stations operating on Crete into natural gas-fueled units by 2020, as it had previously assured, energypress sources have informed.

Though the island does not appear likely to experience an energy sufficiency problem, the cost of preventing a shortage will be considerable and will be covered by consumers around the country through elevated public service compensation (YKO) surcharges included on electricity bills.

Crete’s ageing diesel-fueled units, offering a total capacity of 100 MW, were given lifespan extensions in June through a legislative amendment delivered by the previous energy minister Giorgos Stathakis, without EU approval. EU fines cannot be ruled out.

This additional operating time is intended to provide cover until the launch of a small-scale grid interconnection to link Crete with the Peloponnese, expected at the end of 2020. A large-scale interconnection linking Crete with Athens is expected in 2023.

The conversion of the old power stations into gas-fueled units has constituted part of an overall plan to ensure energy sufficiency on Crete between 2020 and 2023.

Besides the high cost entailed in running these old power units, energy sufficiency on Crete is made even more expensive by high-priced leasing costs of power generators deployed on the island every summer to meet higher tourism-related electricity demand.

Plans for the installation of an FSRU off Crete appear to have also run into problems. Gas grid operator DESFA has proposed a bigger and permanent onshore LNG terminal installation.

 

Supreme Court rejects Euroasia case for Crete link control

The Council of State, Greece’s Supreme Administrative Court, appears to have rejected a case filed by Euroasia Interconnector, a consortium of Cypriot interests, challenging the appointment of Greek power grid operator IPTO subsidiary Ariadne as project promoter of a grid interconnection to link Crete with Athens, energypress sources have informed.

Euroasia, heading a consortium formed for a wider PCI-status interconnection project to link the Greek, Cypriot and Israeli grids, is seeking control of the Crete-Athens segment’s development.

Legal experts believe Euroasia’s challenge will not succeed.

The Cypriot consortium’s Supreme Court move, which opposed the Ariadne subsidiary’s appointment by RAE, Greece’s Regulatory Authority for Energy, followed an unsuccessful legal attempt at the Authority for the Examination of Preliminary Appeals (AEPP).

The Supreme Court’s verdict is crucial as it will determine if ongoing tenders for the development of the Crete-Athens interconnection can continue or not.

Procedures concerning a tender for the project’s transmission stations are progressing and attracting the interest of major developers and suppliers. This tender’s deadline was extended by one month.

The energy ministry, in contact with the European Commission over the matter, has not written off the prospect of a settlement with Euroasia but insists the project’s swift development is the key criterion behind decisions.

Supplying the required capital for a minority stake in Ariadne appears to be the only available option for Euroasia at this stage. However, the Cypriot consortium does not appear willing to take such a route.

Time is running out. Greece has until October 31 to inform a European Commission committee handling the EU’s PCI list if the country will support the Crete-Athens interconnection as part of the wider PCI project or proceed with its development as a national project.

Supreme court to hear Euroasia Crete-Athens case Thursday

The Council of State, Greece’s Supreme Administrative Court, is scheduled to hear a case filed by Euroasia Interconnector – a consortium of Cypriot interests heading a PCI-status grid interconnection project to link the Greek, Cypriot and Israeli systems – against Greek power grid operator IPTO on September 5.

Euroasia, embroiled in a dispute with IPTO for control of the Greek segment’s development, planned to link Crete with Athens, recently escalated its legal effort following a rejection by AEPP, the Authority for the Examination of Preliminary Appeals.

Commenting on the upcoming hearing, legal sources said they do not expect a favorable verdict for the Euroasia consortium.

Though the deadline of a project tender held by Ariadne Interconnector, an IPTO subsidiary, was given a one-month extension to September 30, procedures are progressing normally, while all major players appear interested, sources told energypress.

IPTO has increased the budget of the Crete-Athens interconnection to 380 million euros from an initial figure of 315 million euros. This 20 percent increase reflects the development cost, taking into account related projects in other parts of Europe as well as a high risk of delay-related costs.

The Crete-Athens interconnection needs to be completed in a 36-month period, far shorter than time periods of between 48 and 72 months offered for equivalent projects, internationally.

The Greek energy ministry has indicated a willingness to cooperate with the Cypriot consortium, making clear the project’s swift development is a pivotal factor behind decisions.

Greece has until October 31 to inform a European Commission committee if the country intends to support the Athens-Crete interconnection as a part of the wider PCI project or as a national project.

Euroasia takes Crete grid link case to supreme court

Euroasia Interconnector, a consortium of Cypriot interests heading a PCI-status grid interconnection to link the Greek, Cypriot and Israeli systems, has escalated its legal action against Greek power grid operator IPTO amid their dispute for control of the Greek segment’s development, planned to link Crete with Athens.

Euroasia has stepped up its legal action by filing a case to the Council of State, Greece’s Supreme Administrative Court, following a rejection by AEPP, the Authority for the Examination of Preliminary Appeals, reliable sources have informed energypress.

The Cypriot consortium is seeking to have an AEPP verdict overturned, which would disrupt related project tenders currently being held by Ariadne Interconnector, an IPTO subsidiary.

The case is scheduled to be heard on September 5, the sources noted, adding Greek authorities are in the process of making their legal preparations.

The recently appointed Greek energy minister Costis Hatzidakis has already made clear his intentions to not alter the project’s ongoing procedures, while also indicating a willingness for greater cooperation with the Cypriot side.

 

 

Euroasia escalates Crete grid link legal action, IPTO unperturbed

Euroasia Interconnector, a consortium of Cypriot interests heading a PCI-status grid interconnection to link the Greek, Cypriot and Israeli systems, has escalated its legal action against Greek power grid operator IPTO by submitting a suspension request intended to stop the latter’s development of the project’s Greek segment, to connect Crete with Athens.

The two sides have been at odds for control of the Greek segment’s development. The Crete-Athens electricity grid interconnection is urgently needed to prevent an energy shortage on Crete, Greece’s largest island.

The action comes following a meeting this week between Euroasia Interconnector officials and Greece’s newly appointed energy minister Costis Hatzidakis. The Cypriot officials obviously came out of the session  dissatisfied.

Euroasia Interconnector is seeking to overturn decisions by Greek authorities that have established Ariadne Interconnector, an IPTO subsidiary, as the Crete-Athens grid interconnection’s project promoter.

The latest legal action threatens to block tenders concerning the local segment’s development.

IPTO’s legal representatives are confident the latest action will prove futile and not lead to any further delays of the the project’s two tenders, both currently in progress.

Participants of a tender for the engineering, procurement and installation of cables and stations concerning the Crete-Athens electricity grid interconnection face an August 5 deadline, following two extensions. A second tender for the engineering, procurement and installation of two transformer stations and a substation concerning the project has been extended to August 30.