Country’s solar energy capacity on course to overtake wind energy

Solar energy units are on course to overtake wind energy as the country’s biggest RES sub-sector, given the growing number of installations of the former and a slowdown of the latter during the first half, latest data provided by DAPEEP, the RES market operator, has shown.

At the current rate, the total capacity of solar energy facilities could, for the first time ever, exceed that of wind energy units in the second half of this year.

At present, the country’s wind energy capacity totals 4,294 MW, solar energy capacity is at 4,173 MW, and roof-mounted photovoltaics are at 371 MW. They are followed by small-scale hydropower units (246 MW), biogas-biomass (99 MW) and cogeneration-combined hear and power (118 MW).

The country’s installed RES capacity increased by 207.4 MW in May, solar energy units being the biggest contributor (153.2 MW), followed by wind energy (51.8 MW), small-scale hydropower units (1.7 MW) and biomass (0.7 MW), the DAPEEP figures showed.

The RES market operator expects renewable energy installations in 2022 to reach 1,900 MW, led by solar energy units (950 MW), and followed by wind energy (910 MW), biomass (15 MW), cogeneration-combined hear and power (15 MW), and small-scale hydropower (10 MW).

Greece’s total installed RES capacity reached 9,300 MW in May, up from 8,500 MW at the beginning of the year, the DAPEEP data showed.

 

August pressure for energy retailers, covering subsidies

Electricity and gas retailers fear even tougher financial times in August as the government’s increasing levels of energy subsidy support offered to consumers to offset rising wholesale energy prices and keep energy bills serviceable will force suppliers to use greater amounts of company capital for the effort, company officials have told energypress.

Energy suppliers need to commit company capital for customer subsidies in accordance with subsidy support packages announced by the energy ministry before they are reimbursed about a month later via the Energy Transition Fund, once DAPEEP, the RES market operator, has cleared related amounts.

The one-month period elapsing from the time suppliers cover subsidies, at their own cost, to their eventual reimbursement is pushing suppliers to their financial limits.

It should be pointed out, energy suppliers have yet to be reimbursed for subsidies they paid for in June, concerning consumption in May.

Reduced supplier guarantees to operators being examined

RAE, the Regulatory Authority for Energy, looking for ways to ease the cashflow pressure felt by electricity suppliers in the energy crisis, is considering to reduce the level of guarantees they need to forward to the country’s operators – power grid operator IPTO, RES market operator DAPEEP, and distribution network operator DEDDIE/HEDNO – by revising a formula that determines these guarantee amounts.

However, certain independent, non-vertically integrated electricity suppliers remain apprehensive, fearing such a move could ultimately further increase the market strength of bigger rivals and push smaller players further aside.

At this stage, RAE is involved in talks with the market operators in an effort to determine if leeway exists for a reduction of the guarantees provided by suppliers.

RAE’s Aggeliki Mourtzikou, Director of the Wholesale Energy Markets Department, told the recent energypress Power and Gas Forum that the authority is moving carefully so that any intervention does not result in the creation of deficit figures whose side effects in the market could outweigh any short-term benefits concerning supplier cashflows.

The number of consumers seeking installment-based payment arrangements for energy bills has risen sharply, severely impacting the cashflow of suppliers.

Subsidy returns to power, gas suppliers currently trapped

A sum estimated at one billion euros, which should, by now, have been transferred by the Greek State to energy suppliers as compensation for subsidies they have offered to households and businesses on its behalf, remains trapped in the coffers of DAPEEP, the RES market operator, as a result of rule ambiguities and errors, sources have claimed in comments to energypress.

This amount, planned to cover subsidy-related payments made by electricity and natural gas suppliers for January, February as well as March, is stuck at DAPEEP as three ministerial decisions issued last month, which define the framework for electricity and gas bill subsidies offered to household consumers, businesses and farmers, as well as subsidy clearance procedures enabling payments to suppliers, contain ambiguities and mistakes, the sources told energypress following its related report on payment delays faced by energy suppliers.

As a result of these ministerial decisions, DAPEEP has been called upon to check whether subsidy amounts covered by suppliers from their own funds on behalf of the Greek State are correct, the sources said.

In essence, the operator has been asked to cross-examine whether consumers who were subsidized were eligible for the support, restricted to primary residence only, and whether other eligible parties ended up not receiving subsidies.

DAPEEP is not in a position to perform this task alone as the RES market operator needs to cross-examine its figures with those of DEDDIE/HEDNO, the distribution network operator, and IPTO, the power grid operator, for which it does not have access, the sources explained.

March power, gas subsidies unchanged, suppliers owed

The level of state subsidies to be offered to household and business consumers for electricity and natural gas in March will remain unchanged compared to February, a support measure worth 350 million euros for the month, sources have informed.

Energy suppliers have already been informed of the decision, reached by the energy ministry.

As a result, household consumers will receive electricity subsidies worth 39 euros per month for consumption up to 300 kWh, only for primary places of residence.

Low-income households eligible for social residential tariffs (KOT) stand to receive electricity subsidies worth 51 euros per month.

Monthly subsidies for non-household consumers, including businesses, farmers and professionals, will remain at the level of 65 euros.

As for natural gas, household consumers stand to receive state subsidies of 20 euros per MWh plus that much more from the gas company DEPA Commercial. Businesses will receive 20 euros per MWh.

According to sources, energy suppliers have yet to be compensated by DAPEEP, the RES market operator, for subsidies offered in January and February, on behalf of the Greek State. Subsidies offered by the Greek State over the two-month period were worth a total of 700 million euros.

DAPEEP sources have ascertained that the sum owed by the operator to energy suppliers will be covered either late this week or early next week.

This delay has increased the cashflow strain felt be energy suppliers, now facing even greater pressure following last week’s invasion of Ukraine by Russia, a development that has sparked a further rise in energy prices.

Electricity market pushed to its limits by widespread debt woes

The country’s electricity market is under severe pressure, being pushed to its financial limits by a chain effect of unfavorable events, namely serious cash-flow issues faced by suppliers, increasing overdue amounts owed by thousands of consumers to suppliers, as well as greater surcharge debt owed by the latter to electricity network operators and municipalities.

This concerning picture was presented in detail yesterday by two market operators, distribution network operator DEDDIE/HEDNO and RES market operator DAPEEP, to the board at RAE, the Regulatory Authority for Energy, with energy minister Kostas Skrekas also participating.

Teleconferences were also staged with a number of electricity suppliers for discussions on their delays in relaying surcharges collected through electricity bills to network operators and municipal administrations.

Older surcharge amounts owed by suppliers, up until October, 2020, have led to payback arrangements equally dividing these amounts to letters of guarantees and monthly installments. Most of these commitments are being honored by the suppliers.

However, newer debt issues have emerged through the current energy crisis, beginning last autumn.

According to energypress sources, suppliers owe a total amount of 50 million euros to DAPEEP, a little under 10 million euros to power grid operator IPTO, and over 200 million euros to DEDDIE/HEDNO.

Much of the sum owed to DEDDIE/HEDNO has been covered by letters of guarantee issued by suppliers, following a related revision made by the energy ministry last August.

 

Supplier surcharge relay delays to operators on RAE agenda

Details of accumulated electricity-bill surcharge payment delays by electricity suppliers to market operators will be examined at a RAE (Regulatory Authority for Energy) board meeting tomorrow to involve the participation of three market operators, distribution network operator DEDDIE/HEDNO, power grid operator IPTO and RES market operator DAPEEP.

The progress of agreements concerning installment-based payments by electricity suppliers to operators for overdue surcharge amounts totaling 347 million euros up until October, 2020 will be on tomorrow’s agenda.

Suppliers owing this surcharge amount have faced penalties for their delays. The suppliers reached agreements to cover 50 percent of surcharge amounts owed with letters of guarantee and settle the remainder through installments over periods ranging from 8 to 10 months.

Besides updates on older surcharge amounts owed by suppliers, the three operators, at tomorrow’s RAE meeting, will also be asked to provide details on more recent unpaid surcharges, especially amounts concerning 2021.

According to RAE officials, a total of 12 electricity suppliers have fallen behind on surcharge payments since October, 2020, leading to an accumulated amount, since that month, of approximately 250 million euros. This figure remains unconfirmed. Tomorrow’s meeting will offer a clearer picture.

In addition, the failure of suppliers to relay municipal-related surcharges, currently worth a total of between 60 and 70 million euros, to municipalities will also be discussed at tomorrow’s RAE board meeting. In some cases, these delays have stretched for periods of up to 18 months.

This issue was discussed at a meeting yesterday between energy minister Kostas Skrekas and representatives of the Central Union of Greek Municipalities (KEDE), who called for a revision that would require electricity suppliers to relay surcharge amounts to municipalities within two months.

 

Subsidies over €1.5bn in ’22, to avoid inflationary pressure

The government’s electricity bill subsidies in 2022 will exceed a total value of 1.5 billion euros and, besides households and small businesses, also include medium and high-voltage consumers, according to sources.

Government officials, including energy minister Kostas Skrekas, the energy ministry’s secretary-general Alexandra Sdoukou, deputy finance minister Theodoros Skylakakis, RES market operator DAPEEP’s chief executive Giannis Giarentis and Regulatory Authority of Energy (RAE) chief executive Athanasios Dagoumas, have just held a meeting in search of measures offering protection to consumers against exorbitant energy prices, expected to remain elevated in the first few months of the year.

Final details on the new subsidy package for electricity bills are expected to be set within the coming days before it is announced during the first week of January by the energy and finance ministries.

The plan is expected to include a mechanism automatically calculating subsidies for retail electricity, over a one or two-month period, when wholesale electricity prices exceed a certain level.

Besides offering consumers some energy-crisis relief, the support package’s aim will be to help enterprises avoid increasing prices of products and services, which would prompt inflationary pressure, should energy prices not de-escalate in the coming months.

 

Measure to spare suppliers of interest payments to operators

A legislative revision prepared by the energy ministry will be designed to spare suppliers of having to pay interest on overdue amounts owed to operators as a result of unpaid receivables.

Suppliers will only need to pay interest on overdue amounts owed to operators in cases where court verdicts have ruled for the inclusion of interest payments.

The amendment concerns payments by power suppliers to power grid operator IPTO, distribution network operator DEDDIE/HEDNO and DAPEEP, the RES market operator.

 

PPC cuts operator, contractor debt by €800m in 2 years

Power utility PPC has settled most of its outstanding debt owed to operators and contractors, reducing the amount from 900 million euros in 2019 to 70 million euros at present, the figure with which the corporation expects to end the year, energypress sources have informed.

During the country’s ten-year recession, prior to the pandemic, PPC’s debt owed to operators and contractors had peaked at nearly one billion euros.

The corporation now owes 50 million euros to contractors and 20 million euros to the three market operators – DAPEEP, the RES market operator; IPTO, the power grid operator; and DEDDIE/HEDNO, the distribution network operator – latest company data has shown, the sources noted.

Besides benefitting PPC, which, for years, was embroiled in a series of legal battles with operators, contractors and equipment suppliers, the debt reduction is also helping offer market stability.

Other suppliers have had difficulties keeping up with payments to operators during the energy crisis and its narrower profit margins. If PPC, the dominant supplier, was also delaying its payments to operators at present, the energy market may have been in an unstable condition.

The total amount currently owed by electricity suppliers to the market operators is estimated at 350 million euros, making PPC’s 20 million-euro owed just a fraction of the sum.

 

RES producers must return extra revenues from FIPs by December 17

A procedure for the return to DAPEEP, the RES market operator, of extra revenues generated by RES units with feed-in premiums through their participation in the electricity market prior to October, when the market clearing price was above their tariffs, is expected to start today.

According to energypress sources, DAPEEP, in association with banks, has finalized a formula for the return of extra revenues to the RES market operator. It is expected to upload, within the day, related information on the amounts to be returned for extra revenues up until August. Amounts for the other months are expected to be determined within the next few days.

A related energy ministry draft bill set to be ratified will require all extra revenues generated by RES units with feed-in premiums prior to October to be paid by December 17.

 

 

 

 

 

RES supporting surcharge now a competitive component of bills

The energy ministry is working on a plan to change the status of a RES-supporting ETMEAR surcharge included in electricity bills from regulated to competitive by having it incorporated into the pricing policy of suppliers, the objective being to reduce the burden of this surcharge for consumers.

The initiative represents part of the ministry’s wider effort to restructure the RES special account, remunerating renewable energy producers.

The anticipated reduction of the ETMEAR level is expected to be offset by revenues that will be generated by green certificates to be auctioned off by DAPEEP, the RES market operator, a plan taking its cue from a formula adopted in a number of EU member states, including the Netherlands and Poland.

Green certificate revenues could reach as much as 600 million euros per year, energypress sources informed.

Under the new system, suppliers will need to purchase a minimum number of green certificates in proportion with their sales, securing a revenue source for the RES special account.

DAPEEP will no longer need to collect revenues from consumers, instead collecting from suppliers through the new mechanism.

RES license simplification bill reducing steps from 7 to 5

An energy ministry draft bill carrying a second round of RES license simplification measures for prospective projects carries revisions designed to merge three licensing steps into one in order to quicken the overall procedure.

According to the draft bill, three stages needed to be satisfied by investors, the connection term process, installation permit, and establishment of an operating aid contract with RES market operator DAPEEP, will be carried out concurrently.

Until now, one stage has needed to be completed before the next can commence.

This revision will reduce the total number of RES licensing stages to five from seven at present.

Under the new system, the RES licensing procedure will begin with the producer certificate, which investors must obtain before applying for an environmental permit as the second step, and then applying for connection terms as step three. The fourth step for investors will entail establishing agreements with DAPEEP and the grid operator, while the fifth and final stage will involve obtaining an operating license.

The total number of supporting documents required by RES investors for the overall licensing procedure is being reduced from 91 to 54, the energy ministry announced.

 

Supplier overdue payments to operators reaches €350m

Overdue payments owed by energy suppliers to the country’s market operators have been on the rise since summer, now exceeding 350 million euros, a development that has prompted the government to consider implementing an installment-based payment schedule as part of the solution.

The sharp increase in wholesale electricity prices over recent months has had a severe affect on the cash flow of suppliers, putting them under major financial pressure.

However, it should be pointed out that the majority of this 350 million-euro amount owed by suppliers to operators concerns the power utility PPC and includes a considerable amount owed from long before the current energy crisis.

Power grid operator IPTO, distribution network operator DEDDIE/HEDNO, and RES market operator DAPEEP are all owed sums by the country’s suppliers.

RAE, the Regulatory Authority for Energy, is now considering a three-part solution entailing:  provision of letters of guarantee by suppliers to the operators, to prevent any further rise of the debt owed; immediate deposits covering 50 percent of amounts owed, either in cash or through bank guarantees representing equivalent amounts; and settlement of the remaining 50 percent through an installment-based schedule of between 8 to 12 payments, depending on respective agreements.

RES operator given control of new Energy Transition Fund

DAPEEP, the RES market operator, whose influence in the energy market is growing, will be given control of the new Energy Transition Fund, a move promising to give the operator a key role in efforts to counter energy cost increases when prices are at exorbitant levels, as is the case at present.

A large percentage of the ETF’s revenues will come from CO2 emission right auctions, staged by DAPEEP.

Through its authority over the new ETF, DAPEEP will be in a position to manage state funds, including, for example, planned subsidies for natural gas bills, expected to be derived from the state budget, at least for the final quarter of 2021, sources informed.

In due course, DAPEEP, through the ETF, will also manage funds to be generated by other prospective green surcharges, including an expected expansion of the carbon emission rights system into transportation and buildings.

These new roles promise to further establish the place of DAPEEP in the domestic energy market.

RAE forced to reset Cretan market target model entry for November 1

RAE, the Regulatory Authority for Energy, has reset the target model entry of Crete’s electricity market for November 1, a month beyond a previous date set by energy ministry legislation, to enable full development of information systems to be used by operators and their associates, and also ensure that consumers are better informed on the transition, the authority’s president Thanasis Dagoumas has announced.

This change of date highlights the fact that time had run out for the settlement of pending issues ahead of the previous October 1 launch date for a Cretan hybrid model, intended to offer protection against extreme fluctuations in the balancing market.

As previously reported by energypress, RAE, last week, requested updates from the operators (power grid operator IPTO, distribution network operator DEDDIE/HEDNO, RES market operator DAPEEP) as well as the energy exchange, on their level of readiness, technically, for the Cretan electricity market’s target model entry on October 1.

It can be presumed that at least some of these agencies had not completed actions required in their respective domains for a launch tomorrow.

Crete market’s target model entry behind schedule

Delays observed in technical preparations by operators for the target model entry of Crete’s electricity market have resulted in pending issues that could prevent next month’s launch date from being achieved.

The energy ministry has prepared legislative revision stipulating a launch of a hybrid model for Crete on October 1.

In response to the delay, RAE, the Regulatory Authority for Energy, will request updates from the operators (power grid operator IPTO, distribution network operator DEDDIE/HEDNO, RES market operator DAPEEP) as well as the energy exchange, on their level of readiness, technically, for the Cretan electricity market’s target model entry at the beginning of next month.

RAE will reset the current launch date if it judges preparations to be at an unsatisfactory level. A one-month extension, for a November 1 launch, is possible.

 

 

Assessment of June cycle producer certificate bids by end of month

The assessment by RAE, the Regulatory Authority of Energy, of RES production certificate applications submitted to the June cycle is progressing and should be completed by the end of September, energypress sources have informed.

Barring no complications, such as overlapping RES property issues, applicants should receive related emails by early October requesting payment of producer certificate fees to DAPEEP, the RES market operator. Successful applicants will be given 20 day-periods to pay this fee.

A total of 743 applications for RES units representing a total capacity of 17.4 GW were submitted to RAE for the June cycle, the authority has announced. Solar energy units, totaling 302 and representing 12.8 GW, were the cycle’s dominant RES technology, followed by wind energy units, reaching 290 in total for 4.2 GW.

Meanwhile, RAE is preparing to establish a 35,000-euro letter of guarantee as a prerequisite for applications, this measure’s objective being to limit applications to RES investors with serious intentions.

The authority launched a brief public consultation procedure on Friday. It concludes tomorrow, paving the way for the energy ministry’s draft bill for the letter of guarantee measure’s implementation.

 

Non-auction PV, wind unit exceptions over at end of ’22

A recent measure enabling small-scale PV installations of up to 500 KW without competitive procedures for tariffs, under the condition that applicants do not already possess two projects of such technology, has sparked renewed activity in the sector around the country with thousands mobilizing.

However, for a full picture, this development needs to be combined with the fact that the measure represents a temporary window of opportunity for small-scale producers that will slam shut at the end of 2022.

According to official policy, as of January 1, 2023, RES units will only be eligible for operational contracts with DAPEEP, the RES market operator, if they have participated in competitive procedures.

This essentially means that old 500-KW PVs, wind energy turbines of up to 3 MW and equivalent facilities of energy communities, plus new RES units will need to have established contracts with DAPEEP by the end of 2022.

Though this represents ample time from a technical perspective, investors typically face big delays for connection term offers from DEDDIE/HEDNO, the distribution network operator. In most parts of the country, the operator’s examination of applications and eventual response takes several months.

Even more crucial for investors seeking to develop RES facilities without going to auction is the fact that the majority of DEDDIE/HEDNO responses are negative as network capacity availability is limited.

Applications for non-auction PVs will be submitted to an online platform planned to be developed by DEDDIE/HEDNO. First-come, first-served qualification criteria will be applied.