RAE, disgruntled, staging consultation for Kavala UGS price regulations

RAE, the Regulatory Authority for Energy, will discuss, at a board meeting on Thursday, business pricing regulations for a prospective underground natural gas storage facility (UGS) at the almost depleted natural gas field of “South Kavala” in the Aegean Sea’s north, before offering a proposal for public consultation ahead of a finalized decision, the authority’s president Athanasios Dagoumas told a press conference yesterday, confirming a previous energypress report.

Privatization fund TAIPED has pressed for this pending, and significant, step to be taken so that the prospective facility’s ongoing privatization can enter its final round of binding bids.

A gas grid operator DESFA and GEK TERNA partnership, as well as Energean Oil & Gas, have advanced to the second round of the project’s tender, staged by TAIPED, offering contracts for the development and operation of the facility.

In his comments yesterday, the RAE chief, clearly annoyed, noted that the process, until now, has had to overcome obstacles. He was particularly critical of DESFA, alleging the operator forwarded an unacceptable proposal as the authority’s role is to “protect the people, not help operators maximize their profit.”

DESFA proposed the development of a parallel double pipeline running from Thrace, in the country’s northeast, to northern city Thessaloniki, so that the Kavala UGS could function, according to Dagoumas, who added this would cost consumers in Greece nearly one billion euros, more than double the operator’s estimate of 450 million euros.

“There’s no way this proposal would cost 450 million euros…must be joking. Consumers in Greece would need to cover one billion euros so that the operator can make a profit,” Dagoumas argued. “They ought to be ashamed of themselves, having consumers pay one billion euros for pipelines we don’t need. This is not a colony.”

Senfluga, the consortium representing Italy’s Snam (54%), Spain’s Enagas (18%), Belgium’s Fluxys (18%) and Coupelouzos Group’s DAMCO ENERGY SA (10%), controls DESFA with a 66 percent stake. The Greek State holds the other 34 percent.

DESFA, responding to energypress questions, offered a completely different picture, insisting its Kavala UGS pipeline proposal would cost 420 million euros and is necessary as existing infrastructure is close to saturation point, especially in the north. Upgrades are needed to facilitate new infrastructure that would establish the country as a gas hub, DESFA officials noted, describing its proposal as a necessary network upgrade.

 

 

Authorities on alert to counter snowstorm impact on country’s grid

The government and market operators are on high alert to counter, as effectively as possible, the impact on the grid of heavy snowfall around the country over the next few days.

Severe snowstorms last winter had led to network damages and outages over a number of days in a various parts of Greece, including the wider Athens area.

The government, distribution network operator DEDDIE/HEDNO, power grid operator IPTO and gas grid operator DESFA are all on stand-by as the weather system, dubbed Elpida, moves in, bringing heavy snowfall.

The energy sector is well prepared to ensure energy sufficiency during the snowstorm’s anticipated rise in energy demand, authorities have noted.

Pipeline natural gas and LNG reserves at DESFA’s Revythoussa islet terminal just off Athens are sufficient to cover heightened demand during the adverse weather, officials have noted.

Total energy demand for today is forecast to reach 171,775 MWh, of which 58,825 MWh is expected to be provided by renewables, 94,606 MWh by natural gas-fueled power stations and 13,290 MWh by hydropower units.

Four lignite-fired power stations, Agios Dimitrios II, III IV and Meliti, are currently operating, while independent natural gas-fueled power stations operated by Heron, ENTHES, Thisvi, Protergia and Corinth Power are also generating for the grid.

DEDDIE/HEDNO, the distribution network operator, has announced a new hotline (800 400 4000) to which consumers can report any network damages.

 

RAE close to decision on Kavala UGS pricing regulations

RAE, the Regulatory Authority for Energy, is preparing to decide on business pricing regulations for a prospective underground natural gas storage facility (UGS) at the almost depleted natural gas field of “South Kavala” in the Aegean Sea’s north, a step that would pave the way for the second round of binding offers in an ongoing privatization offering contracts for the development and operation of the facility.

The facility’s pricing regulations are scheduled to be discussed at a RAE board meeting this Thursday, sources informed.

The authority may opt to not take a final decision on the pricing regulations during this session and instead announce a preceding public consultation procedure of brief duration, between one and two weeks, to take into account the resulting feedback and then decide on the pricing regulation details, the sources added.

A gas grid operator DESFA and GEK TERNA partnership, as well as Energean Oil & Gas have advanced to the second round of the project’s tender staged by privatization fund TAIPED.

According to a previous RAE decision, 50 percent of the project’s cost will be passed on to gas network users. As for the other 50 percent, 35 percent is expected to be covered through EU funding, assuming the project is included on the EU’s Projects of Common Interest (PCI) list, while the remaining 15 percent will be taken on by the eventual investor.

Natural gas consumption hits record level in 2021, up 10.9%

Natural gas consumption in Greece reached an all-time high in 2021, increasing by 10.87 percent to 69.96 million MWh, up from 63.1 million MWh in 2020, according to annual data provided by DESFA, the country’s gas grid operator.

Natural gas-fueled power stations represented the greatest share of this consumption, using 68.65 percent in 2021, while household consumers and suppliers linked to the grid followed with 18.77 percent. Industrial enterprises directly linked with DESFA’s high-pressure supply system consumed 12.56 percent of the country’s total natural gas inflow.

Sidirokastro in Greece’s northeast remains the main natural gas entry point, while considerable natural gas quantities were also brought in from the new Nea Mesimvria entry point, in the north, which, since late 2020, has linked the country’s grid with the TAP pipeline running across northern Greece.

 

Small-scale LNG supply to detached locations now imminent in Greece

The arrival of small-scale LNG supply in Greece is now imminent following the completion in the  construction of an truck loading station at gas grid operator DESFA’s LNG terminal on the islet Revythoussa, just off Athens.

Revythoussa’s LNG truck loading station, the first such installation in southeast Europe, represents an important step towards the introduction of small-scale LNG supply in Greece. A second step, the installation of an LNG jetty by DESFA at its Revythoussa facility, is planned to soon follow.

Once this project is completed, Greece will become Europe’s latest country possessing truck-loading facilities, enabling LNG supply from Revythoussa to non-interconnected facilities around the country.

This prospect will offer greater energy supply flexibility to Greek industries, small-scale producers and farms in remote areas detached from the country’s natural gas grid.

 

DESFA market test for North Macedonia gas pipeline link in March

A DESFA gas grid operator market test for a gas pipeline project to link the Greek and North Macedonian systems is set to begin following the launch, by the Regulatory Authority for Energy (RAE), of a related public consultation procedure, ending February 7, the authority has announced.

The project’s market test will follow and is expected to be launched by March, the latest.

Towards the end of 2021, DESFA signed a 25 million-euro loan agreement with the European Investment Bank for the project’s Greek segment. This loan had been approved by the EIB more than a year earlier, in August, 2020.

At the time its approval was announced, EIB noted the project promises to further optimize Greece’s gas grid and also promote supply security and competition in the neighboring country through gas source and route diversification.

The project’s Greek segment, budgeted at 67 million euros, is planned to run from Nea Mesimvria, on the western outskirts of Thessaloniki, to the Evzoni area on the northern border.

Late in December, the EIB also approved a 28.9 million-euro loan agreement for the project’s North Macedonian segment. An agreement for this loan is expected to be signed within the next few weeks.

The EIB has also extended a 12.4 million-euro loan to North Macedonia from the Western Balkans Investment Framework (WBIF) for technical support and development of the project.

The gas pipeline, whose overall cost is estimated at 110 million euros, is planned to cover a total of 123 kilometers.

 

 

DESFA to continue leading energy developments at home and abroad

By Maria Rita Galli

Chief executive Operator DESFA, Greek gas grid operator

No one can deny that 2021 was a challenging year for the energy business with the existential threat of the climate change and the much due response of the EU Green Deal coupled with an unseen price volatility and spikes. DESFA had decided to tackle the challenge posed by the energy transition not only by seeing these challenges as a great opportunity, but also by proactively participating to giving shape to the future. As Stephen Hawking famously said, ‘Intelligence is the ability to adapt to change’ and that is what we did in 2021 and plan on keep doing in 2022 and beyond.

During a period in which Greece is implementing comprehensive energy sector reforms to drive decarbonization and foster competitive markets, DESFA is working to enable the transition to a more sustainable energy future, first, through an ambitious investment plan which contributes substantially to achieving the national goals for de-lignification and, secondly, through increasingly investing in the development of new technical and operational capabilities to accelerate this transition, with special emphasis on promoting the adoption of renewable gases, as well as reducing the climate impact of all its operations.

At the same time, beyond effectively serving the domestic energy market, DESFA is further strengthening its key role in the energy sector of Southeast Europe, with the integration of both the existing and new strategic gas infrastructure (such as the TAP and IGB pipelines, the planned FSRUs of Alexandropoulis, Dioryga Gas, and the Kavala UGS) in the gas transmission system, which ensures access of the Greek and Balkan market to new competitive sources of supply. This fact, combined with the ongoing national effort to phase out lignite in the electricity generation sector and the development of the Small-Scale LNG market, are at the core of our investment plan for the coming years. 

More specifically, the new NNGS Development Plan 2022-2031, which is under the approval of RAE, includes projects with a projected budget of €830 million, such as the expansion of the natural gas network in the regions of Western Macedonia and Western Greece, of which €183 million relate to new projects. Of these, €161 million correspond to extensions in new areas, with the main one being the possible project to expand the network in Ioannina. These large-scale investments in the expansion, upgrade and further interconnection of our network are necessary to support a natural gas market which shows significant growth, with 2021 being a record year for natural gas consumption in Greece. In particular, in 2021 there has been a 11.07% increase in gas consumption (MWh) compared to 2020 and 118% compared to 2014. Domestic gas consumption amounted to 69,517GWh, while gas exports to 7,464 GWh. 

Moreover, the recent success of the LNG unloading slots’ auction in the Revithoussa terminal for the period 2022-2024, with a significant short and mis term interest recorded by market players, is a very positive sign for the future. It is reminded thirty-four (34) unloading slots for 2022, seventeen (17) for 2023 and fifteen (15) for 2024 – a total capacity of 17TWh, were booked, in a development which further highlights the strategic role of the Revithoussa LNG terminal for the security of supply of the country and the wider region.

Building on the long experience gained from the Revithoussa LNG Terminal, in the end of 2021, DESFA officially entered with a 20% stake in the shareholding structure of Gastrade, the company that develops the Floating Storage and Regasification Unit (FSRU) of LNG in Alexandroupolis, yet another strategic infrastructure that will further strengthen the energy security of Greece, strengthening its role in SE Europe and offering opportunities for new gas exports to the region.

Apart from ensuring security of supply and facilitating the development of competition in the market, DESFA, through its strategic cooperation with the Hellenic Energy Exchange (HEnEx), in which it is a founding shareholder, is also working for the creation of a functional wholesale market for natural gas and renewable gases in Greece and the SEE region. A major step in this direction is the entry into operation of the new gas balancing platform in the beginning of 2022.

At an international level, within the last year, DESFA made yet another important step towards its establishment as an increasingly competitive international energy force, commencing its first international Operation & Management contract for the O&M of the new LNG Import terminal of KIPIC, in Kuwait, which is one of the largest terminals in the world.

In 2022, we plan to explore new international projects, further highlighting DESFA’s role in the international energy scene. At the same time, we will work to ensure that our network is 100%-ready for the transport and storage of renewable gases, such as hydrogen and biomethane and we plan to assess the possibility to invest into biomethane for auto-consumption, in order to reduce the emission of our own operations.

In addition, we are ready to welcome the prospect of an energy storage facility in Greece, an energy infrastructure that we believe is necessary to guarantee the security of supply of the Greek market. The benefits of this project for security of supply can be significant, as Greece is rapidly moving towards decarbonization, with gas serving as a transitional fuel for electricity generation. However, the project will also have benefits for the wider area, as the underground storage will reduce the supply dependence on pipelines.

Driven by the vision of safely and sustainably operating and developing a technologically advanced network of clean and reliable gas energy, DESFA will continue to lead energy developments in Greece and beyond, further establishing Greece as an energy gateway for the region and actively contributing to the energy transition of the country.

* This article is included in an energypress feature on the challenges, fears and expectations in 2022. 


DESFA reaches FID for west Macedonia region gas pipeline

Gas grid operator DESFA has reached a final investment decision for the development of a natural gas pipeline covering the country’s northern region of west Macedonia, paving the way for the project’s development in 2022 and  completion by the end of 2023.

The bulk of the project is expected to be ready sooner, by January, 2023, which will enable swifter natural gas distribution to many areas.

DESFA chief executive Maria Rita Galli, commenting on the gas pipeline project during a recent session of parliament’s standing committee on production and trade, informed that solutions are being sought for natural gas supply to areas even sooner, by October, 2022.

The gas pipeline project, measuring 157 km, will connect the west Macedonian region with the country’s natural gas grid. Its cost is budgeted at 147 million euros. Financing has already been assured from the grid operator’s own capital as well as a 505 million-euro loan agreement reached with the country’s four main banks, National Bank of Greece, Eurobank, Alpha Bank, and Piraeus Bank.

Galli, the chief executive, noted that an effort will be made to have the project inducted into the new National Strategic Reference Framework in order to minimize network usage costs.

DESFA joining Alexandroupoli FSRU, development imminent

Gas grid operator DESFA is set to sign a contract next week for the acquisition of a 20 percent stake in Gastrade, the consortium established by the Copelouzos group for the development and operation of Alexandroupoli FSRU, a floating LNG terminal planned for Greece’s northeast, energypress sources have informed.

The European Commission offered its approval of DESFA’s entry into the Gastrade consortium approximately three weeks ago. The endorsement was needed as DESFA, operator of Greece’s gas grid, will also be entering an independent gas system by acquiring a 20 percent of Gastrade, making the operator the fifth member of the consortium.

Besides the Copelouzos group, currently holding a 40 percent stake, the Gastrade consortium is also made up of Gaslog Cyprus Investments, a fully owned subsidiary of Gaslog Ltd, owning and operating over 35 LNG tankers; Greek gas utility DEPA; and Bulgartransgaz, each holding 20 percent stakes. DESFA’s entry will give all partners equal 20 percent shares.

A finalized investment decision on the Alexandroupoli FSRU is expected within the first few days of 2022 so that the project can be developed and ready for launch within 2023.

The Alexandroupoli FSRU has, for years, been included on the EU’s projects of common interest (PCI) list, making the prospective facility eligible for favorable EU funding support, as its actualization will contribute to energy source diversification and also bolster energy security and competition in the wider region.

The Alexandroupoli FSRU will become the country’s fourth entry point for natural gas. It is planned to supply up to 944,000 cubic meters of natural gas per hour, or 8.3 billion cubic meters annually, and offer an LNG storage capacity of 170,000 cubic meters.

Authorities confident of energy sufficiency this winter

Energy authorities are confident the country is sufficiently equipped to meet energy demand this coming winter, suggesting that it would take a perfect storm, or combination of a number of unfavorable factors, to cause problems.

Energy minister Kostas Skrekas chaired a meeting earlier this week for an update on the winter preparations from officials at power grid operator IPTO, gas grid operator DESFA, as well as RAE, the Regulatory Authority for Energy.

An extremely cold winter would need to be combined with a sharp rise in electricity demand in neighboring countries, technical issues at Greece’s lignite-fired power stations, subdued RES participation due to weather-related conditions, electricity import difficulties and low water reserves at the country’s hydropower facilities for an energy shortage, authorities have suggested.

At this stage, the country’s natural gas-fueled power stations are running smoothly, but their rising operating costs are a concern.

Greece’s lignite-fired power stations do face occasional technical issues as their maintenance is nowadays less thorough in anticipation of a full withdrawal of these units by the end of 2023 as part of the country’s decarbonization plan.

Hydropower, RES units and electricity imports are all variable factors. The contributions to the grid of the first two depend on weather conditions, while electricity imports will depend on how Greece’s wholesale electricity prices compare with those of neighboring countries. If prices are relatively higher in Greece, the country will import. If price levels here are lower, electricity will be exported.

Gas network upgrade cost in north crucial for UGS sustainability

The cost of reinforcing the gas network in northern Greece, a key component to the financial sustainability of a project entailing the development of an underground natural gas storage facility (UGS) at the almost depleted natural gas field of “South Kavala” in the Aegean Sea’s north, has been discussed at an energy ministry meeting involving officials of RAE, the Regulatory Authority of Energy, gas grid operator DESFA and the privatization fund TAIPED.

Officials are seeking full clarity on the level of investments needed for the gas network in northern Greece so that natural gas can be transported to and from the prospective UGS.

According to DESFA, the country’s gas grid operator, northern Greece’s gas network now requires an upgrade as the prospect of a UGS facility was completely unanticipated when the region’s grid was initially designed and developed.

DESFA-GEK TERNA and Energean Oil & Gas have advanced to the second round of a project tender staged by TAIPED.

Revythoussa terminal LNG slot auctions for ’22 starting today

Gas grid operator DESFA will today stage the first of three auctions planned until November 2 for LNG slots at its Revythoussa terminal in 2022, following a slight delay in the hope of a gas price de-escalation, to no avail.

These sessions are planned to be immediately followed by auctions – to be staged until the end of the year – for reservations of LNG slots at Revythoussa between 2023 and 2026.

DESFA, along with power grid operator IPTO, have their eyes set on the first auction series for LNG slot reservations at Revythoussa in 2022, given the extraordinary market conditions prompted by the sharp rise in natural gas prices over recent months.

According to market experts, making forecasts about the auctions concerning 2022 is next to impossible as it remains unclear if importers, especially electricity producers, managing their own gas supplies, will seek LNG slots at Revythoussa or hold back and instead opt to punt on pipeline gas.

Whatever the outcome, energy sufficiency will not be an issue as the Revythoussa terminal nowadays represents only 30 percent of total gas imports into Greece, the northern grid interconnection and TAP playing dominant roles, DESFA officials noted.

 

 

DESFA 10-yr plan worth €830m includes Ioannina expansion

Gas grid operator DESFA’s latest ten-year development program, revised annually and now uploaded onto its official website for public consultation, includes projects with a total budget of 830 million euros.

The program, covering 2022 to 2031, includes new projects worth 183 million euros, plus projects worth 647 million euros that were included in the previous ten-year plan, covering 2021 to 2030.

The 183 million-euro amount, designated for twelve new projects budgeted at 161 million euros, includes gas network expansions into new areas, the main project here being an extension into northwestern Greece’s Ioannina area from the west Macedonia region in northern Greece, a project worth 156 million euros.

A further 14.5 million euros is planned to be invested in improving, modernizing and maintaining the country’s gas grid.

 

Crisis Management Committee to examine supply security

The Crisis Management Committee is expected to meet within the first fortnight of October to examine the overall situation in the energy market, driving price levels up to exorbitant levels for consumers of all categories.

The committee’s members will discuss the issue of supply adequacy and security for meeting electricity generation needs, primarily.

Electricity, natural gas and CO2 emission prices are skyrocketing, while natural gas shortages are now emerging in EU markets, all as a result of an extraordinary combination of developments in European markets.

For the time being, Greek energy sector authorities – RAE, the Regulatory Authority for Energy; DESFA, the gas grid operator; and IPTO, the power grid operator – have remained reassuring. Yesterday, RAE president Athanasios Dagoumas noted: “We are not in a state of alarm but are vigilant.”

Overall natural gas consumption is expected to increase in 2021. Consumption was 14 percent higher in the first half compared to the equivalent period a year earlier, DESFA data has shown.

Gas demand rose in July and August to meet increased electricity generation needs and is also expected to be elevated this coming winter.

In Greece, approximately 60 percent of natural gas consumption results from electricity generation. The ongoing withdrawal of coal-fired power stations and greater reliance on fluctuating RES output is expected to lead to a further increase in demand for natural gas.

Local authorities have pointed to Greece’s natural gas source diversification, made possible by the Revythoussa LNG terminal and TAP, both offering alternative solutions, as crucial in the effort to manage the current energy crisis.

Higher steel prices increase project costs in DESFA’s development plan

Gas grid operator DESFA’s latest development plan, covering 2022 to 2030, includes project cost increases as a result of higher steel prices in international markets, sources have informed.

The plan, carrying national-grid upgrade, reinforcement and expansion projects, is expected to be forwarded to RAE, the Regulatory Authority for Energy, within October.

It will then undergo two rounds of public consultation procedures, the objective being for RAE to have approved the development plan by the end of the year.

 

Five hydrogen project proposals make cut for IPCEI contention

Five Greek hydrogen production project proposals have been included in a first-round list submitted by the government to the European Commission for inclusion in its Important Projects of Common European Interest (IPCEI) category, reserved for projects promising important contribution to economic growth, jobs and competitiveness.

The five Greek project proposals, approved by energy minister Kostas Skrekas and development minister Adonis Georgiadis, were selected from 23 proposals submitted by companies for contention following an annoucement by the two ministries last April.

The short list of proposals is planned to be assessed by the European Commission in November for a place on the IPCEI list, ensuring EU support funds.

The list features the 8 billion-euro White Dragon project – involving the country’s biggest energy groups with gas company DEPA Commercial as head coordinator – for a hydrogen producing facility in northern Greece’s lignite-dependent west Macedonia region; the White Dragon-linked Green HiPo project of Advent Technologies; the H2CEM hydrogen project by cement producer TITAN; the BLUE MED project, for eco-friendly blue hydrogen production, by Motor Oil and gas grid operator DESFA; as well as the H2CAT hydrogen storage and transportation project by B&T Composites.

Network users to cover 50% of South Kavala UGS project cost

RAE, the Regulatory Authority for Energy, has approved guidelines specifying how the development cost will be shared for an underground natural gas storage facility (UGS) at the almost depleted natural gas field of “South Kavala” in the Aegean Sea’s north, thereby settling one of the main regulatory issues that remained for an ongoing tender offering use, development and operation of the facility.

According to the RAE decision, 50 percent of the project’s cost will be passed on to gas network users. As for the other 50 percent, 35 percent is expected to be covered through EU funding, assuming the project is included on the EU’s Projects of Common Interest (PCI) list, while the remaining 15 percent will be taken on by the eventual investor.

In the event that the UGS is excluded from the EU’s PCI list, the Greek State will consider becoming a project partner so that the cost for gas network users is not increased.

DESFA-GEK TERNA and Energean Oil & Gas have advanced to the second round of a project tender staged by privatization fund TAIPED.

The almost depleted natural gas field, where the UGS will be developed, is located 18 km south of the main coastline of Kavala, roughly 6 km west of the island Thasos, at a sea depth of 52 meters.

Revythoussa truck loading station soon, LNG jetty in 2022

The development of a truck loading station at the Revythoussa islet LNG terminal just off Athens will be completed and launched by the end of the year, energypress sources have informed.

Also, a new small-scale LNG jetty to serve the truck loading station, and, amongst other things, contribute to LNG bunkering at the nearby Piraeus port, will be ready in autumn next year, the sources added.

The truck loading station is part of gas grid operator DESFA’s ten-year development plan that includes a category for small-scale LNG project installations, worth 40.5 million euros.

According to the ten-year development plan, the new small-scale LNG jetty, budgeted at 20.4 million euros, will be installed at the northeastern section of Revythoussa.

DESFA has already applied for funding support through the National Strategic Reference Framework (2014-2020) that would cover 50.42 percent of the small-scale LNG jetty’s cost.

 

 

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

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.

 

 

Gas network for west, expected in 2023, to be supplied LNG

A natural gas network to cover western Greece’s provincial cities Patras, Agrinio and Pyrgos and scheduled for completion in 2023 will carry LNG to be transported from gas grid operator DESFA’s Revythoussa islet terminal close to Athens.

Regional authority Nekatrios Farmakis has just authorized the project’s entry into the Regional Operation Program (2014-2020) for Western Greece, an important step for this gas network’s development. Work on the project is expected to begin within 2021.

The project, being co-funded by the European Regional Development Fund (ERDF), is budgeted at 21.3 million euros. The gas network will seek to attract business, industrial as well as household consumers.

To be developed by gas distributor DEDA, the new network will run a total distance of approximately of 208 kilometers and be equipped with a metering and regulation station (M/R) for its supply to Patras.

Power producer LNG orders unaffected by higher gas prices

Increased natural gas prices in international markets have not restrained LNG imports at gas grid operator DESFA’s Revythoussa islet terminal just off Athens, data provided by the operator has shown.

LNG orders at the Revythoussa terminal for the two-month period covering August and September, placed primarily by power producers, seeking international market opportunities to subdue fuel costs, as well as gas company DEPA, total more than 742,000 cubic meters, the DESFA data showed.

This quantity represents six LNG tanker loads, ordered by as many key domestic natural gas market players for the two-month period.

Two loads, the first for power utility PPC and Motor Oil Hellas, and the second for Elpedison, arrived during the first half of August. A third tanker carrying LNG orders placed by Mytilineos and Heron will follow this month, bringing August’s LNG orders total at the Revythoussa terminal to 376,000 cubic meters.

Three more LNG shipments are scheduled to arrive at the Revythoussa facility in September. The first of these concerns orders placed by PPC and Motor Oil Hellas totaling 146,000 cubic meters. The second shipment will be for a 73,000-cubic meter order placed by DEPA, while the third concerns a 147,000-cubic meter order made by Elpedison.

Natural gas prices have remained high in international markets, currently about triple the price of levels in March.

DESFA forced to revise project budgets as metal prices rise

Gas grid operator DESFA is being forced to reevaluate its budget for projects included in its existing ten-year development plan and set for inclusion in its forthcoming updated plan as a result of rising metal commodity prices in international markets, which have impacted the cost of gas pipelines and other equipment.

Metal price levels are projected to remain elevated in the foreseeable future. As a result, DESFA officials are striving for solutions that may prevent the transfer of increased project costs to consumers, and also subdue, to the greatest degree possible, additional project costs for the company.

DESFA is expected to deliver its updated ten-year development plan, covering 2022 to 2031, in September, according to sources.

The updated plan will not unveil any surprises in terms of the projects included, the sources added. A gas pipeline project linking the Epirus region in Greece’s northwest with the country’s grid is expected to be added to the DESFA list.

Two options for this project are being considered. One option entails the development of a pipeline from Ptolemaida, northern Greece, to Ioannina, in the northwest, and the other, the construction of a storage facility at the northwestern port of Igoumenitsa, from where a pipeline would run to Ioannina.

 

 

DESFA: NER North Macedonia pipeline agreement, market test next month

Two further important steps in the lead-up to the construction of a natural gas pipeline linking the Greek and North Macedonian grids are expected to be made in September.

DESFA, Greece’s gas grid operator, and North Macedonia’s energy sources company NER are expected to sign an agreement next month as a follow-up to an agreement signed a month ago by the energy ministers of the two countries in Lagonisi, east of Athens.

The latest agreement will stipulate technical issues, as well as guarantees, concerning the new pipeline, paving the way for tenders concerning the project’s development.

In addition, also in September, DESFA and NER also plan to stage a market test that will determine the commercial feasibility of the project. The two sides want to ensure the existence of a sufficient number of buyers for gas quantities planned to be transported through the pipeline.

The Greek section of the gas pipeline, budgeted at 51.4 million euros, is planned to stretch 54 kilometers. The North Macedonian section will cover a 100-km distance.

A September 13 registration deadline has been set for a tender concerning the procurement of steel pipelines for the project. Also, a draft of the tender concerning the project’s construction has been forwarded for public consultation until August 16.

 

DESFA looks to biomethane, hydrogen, plans grid investments

Greek gas grid operator DESFA plans to invest in biomethane and hydrogen infrastructure to be in a position to utilize these eco-friendly gas options and avoid being impacted by the energy transition.

DESFA’s experienced European gas companies holding stakes in the Greek operator believe green biomethane technologies are more developed and mature compared to those available for hydrogen.

Snam, Enagas and DESFA’s other shareholders – Fluxys, Damco – have set as a primary objective to “decarbonize the natural gas chain”.

DESFA officials are in talks with universities, market authorities, as well as Greek enterprises to develop biomethane pilot programs.

More projects such as the White Dragon project – bringing Greece’s biggest industrial corporations closer for major investments in electrolytic hydrogen production by means of solar energy from photovoltaic parks – can be expected next winter, officials anticipate.

If the White Dragon project is approved, DESFA plans to upgrade its existing natural gas network in order to be able to receive hydrogen production, transport from the country’s north to south, channel to TAP and, via TAP, transport to the EU.

DESFA’s share of the White Dragon project, estimated between 30 and 35 percent of the cost, is expected to reach 1.5 billion euros, of which one billion euros – if the project is approved – will concern the development of new infrastructure for hydrogen transmission through the Greek gas network, measuring 1,466 km.

DESFA considering 2 options for gas transportation to Epirus

Gas grid operator DESFA is examining two alternative solutions for the transportation of natural gas to Greece’s northwestern region of Epirus, one of the company’s most important projects of its ten-year development plan covering 2022 to 2031, still not finalized.

One option being considered by DESFA is an extension of a gas pipeline in west Macedonia, northern Greece, from Ptolemaida all the way to Ioannina, the Epirus prefecture’s capital.

The other solution being considered entails the development of an LNG terminal at Igoumenitsa port, from where a 50-km gas pipeline would be constructed into the Epirus region.

The options will undergo public consultation for comments and observations by market players before RAE, in conjunction with DESFA, decides which of the two will be implemented.

DESFA aims to finalize its ten-year development plan covering 2022 to 2031 within the summer before delivering it to RAE in September.

Operators react against RAE’s net profit deduction proposal

Market operators have disapproved a proposal by RAE, the Regulatory Authority of Energy, to deduct a percentage of their net profit from non-regulated activities, contending this would act as a growth disincentive.

Gas grid operator DESFA’s chief executive Maria Rita Galli expressed the company’s concerns earlier this week, during a press conference, following preceding disapproval by power grid operator IPTO just hours earlier in public consultation focused on a formula for the calculation of permitted and required ESMIE (electricity transmission system) revenue.

The DESFA chief executive told reporters the operator is currently in talks with RAE for an agreement that would satisfy both sides.

Deducting a percentage of net profit from operators represents an older approach that has generally been abandoned today, Galli pointed out. Subjecting DESFA to such a deduction would put the operator in a disadvantageous position compared to other companies.

RAE has informed this disputed deduction would be used for the benefit of electricity transmission system users.

IPTO has proposed that the authority’s deduction be limited to outlays made for non-regulated services.

Energy exchange gas platform to be presented Monday

The energy exchange is nearing an expansion through the addition of a new trading platform for natural gas market products, scheduled to be presented by the Hellenic Energy Exchange and gas grid operator DESFA this coming Monday.

Related public consultation, already in progress, is planned to run until the end of August.

Until now, the Greek energy exchange has only facilitated electricity market trade.

The energy exchange, in association with DESFA, has been working on the new gas market platform since last year, the aim being to launch it within 2021.

The exchange’s new gas platform is expected to help establish Greece as a trading hub of geostrategic and geopolitical significance.

EDA THESS and DESFA: Ambitious cooperation with a lot of perspectives

The fruitful cooperation between the National Transmission System Operator and the Distribution Company was the main topic raised in the meeting held at the Company’s premises between the CEO of DESFA, Mrs Maria Rita Galli and the General Manager of EDA THESS, Mr. Leonidas Bakouras.

During the meeting, Mr. Bakouras had the opportunity to stress one of the main strategic pillars of the company that is to ensure the safe and uninterrupted distribution of natural gas.

The CEO of DESFA and the General Manager of EDA THESS discussed about the issues that concern the operation and maintenance of transmission and distribution networks.

The focal point of the meeting was the emerging opportunities and perspectives for further collaboration between the two operators. The great potential to enable the integration of renewable gases such us biomethane blending with natural gas was highlighted. The ultimate goal to ensure security of supply was shared, with the aim of continuously improving the services provided to the users and end consumers.

Moreover, the need for further cooperation in the conduction of preparedness drills, was discussed, by combining scenarios with high level escalation of events that could lead in general crisis in the network. The aim is to enhance the safety-oriented effectiveness of the response mechanism for the involved structures of the two operators and to promote the coordination with the Authorities and co-competent bodies.

Concluding, promoting the sustainability of natural gas networks in alignment with the targets set by the energy roadmap 2030- 50 is a common view.

(photo: The CEO of DESFA, Mrs. Maria Rita Galli with the General Manager of EDA THESS Mr. Leonidas Bakouras) 

 

 

DESFA pipeline agreement with North Macedonia’s MER in July

Gas grid operator DESFA expects ongoing negotiations with North Macedonia’s energy sources company MER, for a cooperation agreement concerning the construction of a natural gas pipeline linking the two countries, will be successfully completed in July, enabling the staging of a market test for the project, whose Greek segment will run north from Thessaloniki’s Nea Mesimvria area.

DESFA plans to stage a market test for the pipeline in early autumn, assuming its cooperation agreement with MER is signed in July.

The cooperation agreement will commit both sides to the project’s construction, serving as a road map for its development and also specifying responsibilities to be taken on by DESFA and MER.

RAE, Greece’s Regulatory Authority for Energy, has set conditions, demanding a market test, and its successful outcome, in order to give the green light for construction of the Greek segment.

Apart from the cooperation agreement to be signed between DESFA and MER, the governments of Greece and North Macedonia plan to sign a corresponding bilateral agreement concerning the interconnection of the two countries through the project.

The details of this bilateral agreement are just about ready and have already been submitted to the European Commission for approval, Greek energy minister Kostas Skrekas told a recent conference.

Brussels’ approval is needed for North Macedonia to qualify for Western Balkans Investment Framework (WBIF) support funds for its segment of the gas pipeline.

The Greek segment, budgeted at 51.4 million euros, will cover a 57-km distance.

DESFA participating in talks for European Hydrogen Backbone

Greek gas grid operator DESFA is one of the participants in early talks for the establishment of a European Hydrogen Backbone, along with 22 fellow operators representing a total of 21 countries.

A latest report, published last month, notes that this network of pipelines can cover a total of 11,600 kilometers by 2030, to service emerging hydrogen markets, and 39,700 kilometers by 2040, with prospects for further expansion beyond this date.

Total investments estimated between 43 and 81 billion euros will be needed to develop the 39,700 kilometers of the hydrogen network pipelines.

Upgrades of existing pipeline networks, to enable the transportation of hydrogen, will account for 69 percent of the investment cost, while the other 31 percent concerns the development of new pipelines.

According to the plan, Greece’s two main industrial hubs, Athens and Thessaloniki, will be linked, by 2040, to the new hydrogen pipelines, to run alongside existing gas infrastructure. Alternatively, an upgrade of the existing gas pipelines, also seen as an option, will depend on market conditions.