NECP and efforts on the right track, Brussels report notes

The country’s efforts to reach objectives set in the National Energy and Climate Plan, shaped by long-term European climate and energy goals, as well as the domestic plan itself, have been favorably reviewed by the European Commission in a related report released yesterday as an appraisal of the finalized NECP submitted to Brussels by the Greek government.

The European Commission, which has reviewed the NECPs of EU member states and how they stand in connection with Europe’s energy and climate objectives, described the Greek plan and its progress as “satisfactory” and “sufficient”.

The Brussels review, however, pointed out that the country’s reforms concerning competition in the retail and wholesale electricity and gas markets, among other domains, require strengthening.

The report also called for an enhancement of Greece’s just transition plan concerning the post-lignite era. Greater detail in the assessment of the social and employment repercussions, as well as retraining requirements, in lignite-dependent areas where the lignite-fired power stations are planned to be withdrawn over the next three years is needed, it noted.

As for measures concerning the Greek economy’s pandemic-related recovery, at least 37 percent of recovery funds to be made available should be invested in climate-linked initiatives so that mid-term emission reduction targets are met, the report noted.

Revision to ensure HEDNO framework for privatization

A legislative revision set to be submitted to parliament by the energy ministry will enable the implementation of a new regulatory framework for DEDDIE/HEDNO, the distribution network operator, as of January 1, 2021, as planned by a revised schedule.

The operator’s new framework, including two four-year periods covering 2021 to 2024 and 2025 to 2028, was initially scheduled to be approved by June 30 but this date was missed as a result of the pandemic’s impact and a leadership change at RAE, the Regulatory Authority for Energy.

Besides being crucial for the market’s operation, the new regulatory framework is a prerequisite for the announcement of the operator’s privatization, to offer prospective buyers a 49 percent stake.

The operator’s WACC rate is expected to be announced in the lead up, either this month or next, if no further delays hamper the overall procedure.

PPC’s latest voluntary exit plan reaches success rate of over 80%

A total of 437 power utility PPC employees have registered for the corporation’s latest voluntary exit plan, limited to staff members over the age of 55, which makes the offer, expiring today, available to approximately 500 persons.

Based on these figures, the success rate of PPC’s latest exit plan, until yesterday, was well over 80 percent.

The total number of voluntary employee exits could reach 450 by the time the offer’s deadline expires later today.

Besides a compensation amount of 15,000 euros for each exiting employee, the program also includes 20,000-euro bonus payments, taking the total package to 35,000 euros for departing staff members.

Approximately 1,300 employees left PPC in 2019 through the voluntary exit plan. The total figure for 2020 is expected just as high, if not higher.

If so, this would take PPC over the half-way mark in its overall voluntary exit strategy. The company has set an overall target of 4,500 departures, according to the latest PPC business plan. PPC also intends to refresh by recruiting 800 new employees.

PPC’s payroll cost has fallen by 45.1 million euros, from 419.3 million to 374.2 million euros, the company announced in its first-half results.

 

DEDDIE sale launch awaiting RAE approval of framework

Distribution network operator DEDDIE/HEDNO is awaiting the approval of its new regulatory framework by RAE, the Regulatory Authority for Energy, needed for the launch of a tender concerning the operator’s privatization, to offer investors a 49 percent stake.

As things stand, RAE is expected to give the green light within October, energypress sources informed.

The operator’s new regulatory framework, to be valid for a four-year period, from 2021 to 2024, and feature an option for a four-year extension, was forwarded for public consultation in June, but a change of leadership at RAE early in July delayed the process.

The operator’s new WACC level, determining the yield for potential buyers, is expected to be announced in October or November so that the privatization’s tender can be announced before the end of the year.

At present, the operator’s annual revenue totals 800 million euros.

It remains to be seen if the overall plan will be carried out as planned as the framework’s approval is a complicated task requiring plenty of work, while RAE faces no legal obligation to deliver on schedule.

Last week, energy minister Costis Hatzidakis, speaking at an Economist conference, assured the DEDDIE/HEDNO privatization will begin in November. However, certain pundits contend the current schedule is overoptimistic.

The new DEDDIE/HEDNO business plan – envisaging an increase of investments to a level of between 350 and 400 million euros, annually, considerably higher than previous levels of around 150 million euros; as well as the recruitment of 1,000 staff members for technical posts – cannot be considered complete without a new regulatory framework.

New target model department at Mytilineos, raising retail, RES goals

The Mytilineos group is assembling a new energy management and trading division, described as a pioneering effort for Greece, in preparation for the forthcoming arrival of the target model.

The new division will be tasked with handling all the group’s electricity production and trading matters, as well as natural gas trading and import activities, the objective being to bring together all the aforementioned concerns under the one management system.

Much is expected of this initiative, Evangelos Mytilineos (home), the group’s chairman and CEO, told analysts during a presentation of company first-half results.

The energy supply market is not yet mature enough for further concentration, Mytilineos noted, making clear his corporation is prepared for this prospect.

He attributed favorable results in the energy sector to low natural gas prices, forecasting a correction in the second half.

The Mytilineos group aims to have captured a 10 percent share of the retail energy market by the end of 2020, its head official noted.

The group has also set elevated RES goals and is aiming for 300 MW of operational wind energy farms and several more hundred MW at various stages of development by the end of 2021, Mytilineos informed.

Negotiations with power utility PPC for new electricity tariffs concerning aluminium producer Aluminium of Greece, a Mytilineos group member, are in progress, he added.

The cost of industrial electricity tariffs is a crucially important issue for the government and power utility PPC.

Mytilineos said he expects metal prices to rebound in the second half of this year, noting the group is not exposed to any price fluctuations for the remainder in 2020 as a result of hedging.

The group’s financial results for 2020 will be close to record levels posted for 2019, analysts were informed.

First-half results have taken the group a step closer to its objectives for the year, while, barring unexpected developments, last year’s dividend level will be maintained, the CEO added.

Pending issues to delay target model launch by a few weeks

The target model’s scheduled September 17 launch date is expected to be postponed by a few weeks following the identification, by authorities, of crucial unresolved issues, even at regulatory level, as well as discrepancies between dry-run market testing results and actual market conditions.

The energy ministry is believed to be preparing to announce the postponement over the next few days. A delay of at least four weeks is expected.

Officials identified the biggest discrepancies in the balancing market, one of the four market systems of the target model, also including day-ahead, intraday and forward markets.

Power grid operator IPTO forwarded a technical decision on balancing market clearing matters for public consultation last Friday, inviting market participants to comment by September 16, just one day ahead of the target model’s scheduled launch.

Other pending issues, sources noted, include a procedure for the selection of reserve power stations; a regulatory framework determining offers by participating units; as well as mechanisms enabling RAE, the Regulatory Authority for Energy, to monitor the behavior of market participants.

Ministry to finalize target model launch date next week

Though the electricity market’s target model launch is scheduled for a September 17 launch, energy ministry officials have shown some reservation by noting the ministry will be in a position to make a finalized decision on the precise date in one week, energypress sources have informed.

The ministry is closely monitoring an ongoing dry-run procedure offering simulated testing of all market systems and assessing their level of readiness on a daily basis, the sources noted.

Operators may have declared being ready for the launch but the energy ministry will not give the green light for a launch until it is absolutely certain that every single issue has been fully resolved.

A change of the launch date for the new markets – day-ahead, intraday, forward and balancing – will be made if this is considered necessary, but any deferral will be limited, officials noted, implying that no more than a few weeks could be given.

The dry-run procedure and rectification of any glitches was supposed to have been completed by now, but authorities have just granted an extension until September 6.

 

Extra week for dry-run tests ahead of target model launch

A dry run procedure offering simulated testing of all market systems and resolving any glitches ahead of the target model launch, scheduled for September 17, has been extended for another week until September 6.

Authorities met last Friday for a latest review of dry-run results. ESAI/HAIPP, the Hellenic Association of Independent Power Producers, in its observations, primarily focused on the balancing market.

The association also objected to integrated programming process revisions proposed by power grid operator IPTO, as well as the timing of these proposals, just days ahead of the official launch of markets.

ESAI/HAIPP is expected to forward its views on the issue, in writing, to the energy ministry, later today or tomorrow. The matter essentially concerns the calculation of reserves to be covered by the system for its security.

The Energy Exchange, to operate the day-ahead, intraday and forward markets, and IPTO, operating the balancing market, are both scheduled – based on a ministerial decision – to deliver an interim report this week for the energy ministry and RAE on the progress and level of readiness of market systems.

These systems have been undergoing continual testing since August 3. The number of dry-run participants has increased in recent days, while price levels are now at far more rational levels, especially in the day-ahead market.

All market participants, approximately 60 in total, have until September 4 to submit required supporting documents to the Energy Exchange in order to receive membership registration certificates by September 11.

 

Supplier guarantees proposed by IPTO ‘needless, excessive’

Electricity suppliers have expressed reservations about a power grid operator IPTO report calling for the payment of guarantees by all parties registered with ESMIE, Greece’s electricity transmission system, to fulfill obligations, describing these guarantees as needless and excessive.

The operator’s report was put forth for consultation by RAE, the Regulatory Authority for Energy, prompting responses from ESEPIE, the Hellenic Association of Electricity Trading and Supply Companies, and three energy suppliers, the power utility PPC, Heron and Protergia.

The IPTO call for guarantees would excessively burden ESMIE members and create serious cashflow problems in the mid to long term, the association and suppliers noted in their responses.

Contrary to formulas used for IPTO and the Energy Exchange, a financial danger coefficient was not applied to the calculations determining the ESMIE member guarantees, the association and suppliers pointed out.

In addition, the IPTO report also calls for a monthly system-use charge imposed on suppliers to be doubled and paid in advance.

The report also proposes a revision to the formula determining penalties for delayed guarantee payments. ESEPIE described the IPTO proposal for a penalty charge of 1,000 euros per month as erroneous, instead offering its support for the current formula, increasing penalty payments for delays by 0.1 percent per day.

RAE has yet to take a position on the IPTO report’s proposals.

PPC preparing new customer loyalty, punctuality incentives

Power utility PPC is preparing new incentives to reward customer loyalty and electricity bill payment punctuality as a response to the retail electricity market’s intensified competition, reflected by a sharp increase in the number of customer switches from one supplier to another.

The company is preparing to announce a tender offering a contract for the development and support of related online technology for a one-year period.

PPC also intends to further promote its online services as part of this effort.

The incentives package is expected to include personalized apps, supported by PPC’s website and smart phones, offering customer benefits through the corporation’s e-bill service.

The PPC plan also entails the development of an algorithm, to be fed data from the corporation’s information systems, for the purpose of categorizing customers in terms of interests, consumption behavior and other customer-base data maintained by PPC.

Electricity consumer complaint and query calls total 3.6m in ’19

Electricity suppliers received a total of 3.6 million query and complaint calls from customers in 2019, RAE, the Regulatory Authority for Energy, acting within the framework of its market monitoring role, has determined after requesting such data from suppliers.

The data reflects the heightened level of competition in Greece’s retail electricity market.

Most of these customer calls had to do with disputed billing procedures and clarification. A total of 92.24 percent of calls were made by customers already committed to supply contracts.

More than half of the 3.6 million calls by customers, or 2.02 million, representing 56.19 percent, were received by power utility PPC, the retail electricity market’s dominant player, holding an 84.44 percent share of the market.

The other 43.81 percent of calls, 1.58 million in total, were shared by the country’s independent suppliers, recipients, primarily, of pre-contractual queries by consumers researching market offers ahead of their choices.

Supply cut orders on the rise, suppliers toughening stance

Electricity suppliers forwarded 360,644 supply cut orders to the distribution network operator DEDDIE/HEDNO in 2019, most of these presumably targeting regular electricity bill dodgers. A total of 227,418 orders were executed, indicating the operator has toughened its stance, data released by RAE, the Regulatory Authority for Energy, has shown.

Nearly half of these consumers, or 111,298, who had their electricity supply cut by DEDDIE/HEDNO rushed to either fully settle amounts owed or register for installment-based payback programs in order to be reconnected to the network by the operator.

Subsequently, a considerable number of consumers, 116,120 in total, were left without electricity. 

Some of the electricity supply cut orders forwarded by suppliers to the distribution network operator may have been initiated by consumers no longer wishing to be serviced for a variety of reasons, including vacant property. The number of such cases was not specified in the RAE report.

Interestingly, suppliers submitted a total of 310,333 requests to cease representing consumers in 2019. Of these, 280,962 were executed by the operator.

Suppliers made these representation-ending requests in response to delays by the operator to execute supply cut orders for unpaid bills. As a result, unreliable and unwanted consumers were transferred to the country’s universal supply service, offering higher-priced electricity supply as a last resort.

Electricity supplier switching by consumers up 89% in 2019

Consumers switching electricity suppliers increased sharply by 89 percent in 2019, a report by RAE, the Regulatory Authority for Energy, has shown.

A total of 576,436 consumers, 8.5 percent of the 6,783,075 consumers in total, switched suppliers in 2019, up from 4.51 percent in 2018, the report showed.

This sharp rise in consumer switches was attributed to growing consumer confidence in independent electricity suppliers as well as the effectiveness of discounts and various other offers made available by these suppliers to attract customers. Put simply, competition in the Greek electricity market appears to be intensifying.

Household electricity consumers showed the greatest degree of mobility, followed by mid and high-voltage consumers, or businesses and industrial consumers, the RAE report observed.

In the mid-voltage category, 834 business and industrial consumers of 9,071 in total, or 9.19 percent, switched electricity suppliers in 2019, according to the report.

Despite the increased customer mobility, power utility PPC remained dominant in 2019, supplying electricity to 5,694,627 consumers, or 83.95 percent of the 6,783,075 in total, the report showed. In terms of consumption, PPC held a 71.13 percent share, supplying 27.7 million MWh last year.

Independent supplier Protergia, a member of the Mytilineos group, was ranked second in terms of total number of customers in 2019, supplying to 181,232 customers, the report noted.

Elpedison was ranked third with 171,143 customers, followed by Heron (140,812), Watt & Volt (127,364), Zenith (73,968), Volton (69,688), NRG (52,961), Fysiko Aerio (39,881), Volterra (35,748) and KEN (33,997).

A total of 24 independent suppliers are active in Greece’s electricity market.

Wholesale electricity prices down considerably in first half

The System Marginal Price, or wholesale electricity price, has fallen considerably and consistently throughout the first half of the year, driven down by lower natural gas prices and a dramatic contraction of lignite-fired generation, now a costly option.

Official data released by the energy exchange shows lignite’s energy mix dominance is fading and renewable energy sources are gaining ground, while natural gas-fueled generation is consistently at the helm. 

The SMP fell throughout the first-half period, falling 22.45 percent to 59.68 euros per MWh in January, compared to the equivalent month a year earlier; 28.55 percent to 49.23 euros per MWh in February; 43.65 percent to 43.65 euros per MWh in March; 54.31 percent to 28.51 euros per MWh in April; 48 percent to 34.27 euros per MWh in May; and 50.04 percent to 34.04 euros per MWh in June.

The SMP is primarily determined by natural gas-fueled power stations, their price-setting involvement measuring 60 percent in June, the energy exchange data showed.

Also in June, natural gas was responsible for 48.06 percent of overall generation, the RES sector generated 34.74 percent of total production, hydropower contributed 9.77 percent, while lignite-fired generation was limited to 7.42 percent.

PPC tender for transformation of commercial division

Power utility PPC, acknowledging, amid an increasingly competitive market, the need to modernize its profile, services and relations with the customer base and energy consumers in general, has decided to stage a tender for a specialized consultant to be tasked with transforming the company’s commercial division.

PPC will invite consultants with specialized skills in this domain to submit offers for the transformation project, whose budget has been estimated at 1.5 million euros by the company.

The winning bidder will be tasked with the design, planning, coordination and monitoring of the implementation of the transformation plan.

Also, the winning consultant will be expected to further develop all service channels, develop retention tools for high-value customers, and also design and launch new value-added products in accordance with modern trends and standards.

Support for the digital transformation of PPC’s commercial activities will also be included in the project.

Remaining energy utility sales, DEDDIE and IPTO, nearing

The time is nearing for Greece’s two remaining energy utility  privatizations, those of electricity distribution network operator DEDDIE/HEDNO and power grid operator IPTO.

An energy ministry official yesterday updated journalists on the progress of both sales at a presentation of gas distributor DEDA’s five-year investment plan.

All details concerning the sale of a 49 percent stake in DEDDIE/HEDNO, a fully owned power utility PPC subsidiary, will be ready and finalized in September, enabling the announcement of a tender that month, according to the ministry official.

Preparations for this sale include the evaluation and transfer of assets used by DEDDIE/HEDNO from PPC to the operator.

As for the IPTO sale, talks between the operator and China’s SGCC – already holding a 24 percent stake in IPTO and first-offer rights in the event of the sale of a further stake in the operator – are still at an early stage.

The energy ministry is moving carefully in an effort to comply with fine details of EU directives concerning the entry of non-EU members into European enterprises and infrastructure.

Launch of electromobility subsidy program now imminent

A draft bill for subsidies supporting purchases of electric cars, scooters, bicycles and recharging units is set for publication in the government gazette today ahead of a needed ministerial decision, probably next week, and the launch of a related platform for applicants, expected in August.

Prospective buyers of electric vehicles and rechargers do not need to wait until the platform is launched. If all criteria are met, buyers can proceed with purchases whose outlay will be deemed valid for subsidy support, energy ministry sources told energypress.

However, buyers will need to promptly lodge their subsidy applications to the platform once it is launched, probably within August, to secure their subsidies.

Just like the “Saving at Home” subsidy program for domestic energy efficiency upgrades, electromobility subsidy applications lodged to the platform will be processed in chronological order until the program’s budget, totaling 100 million euros for one and a half years, has been fully absorbed.

Some 16,000 to 17,000 applications – for electric cars, exclusively – would be enough to fully cover the 100 million-euro amount offered.

A big response and swift absorption of funds is likely to lead to the release of further subsidies supporting the electromobility sector.

The government announced a series of incentives early in June with the aim of invigorating the electric car, scooter and bicycle market. The public’s response to the platform will serve as a crucial indicator on the appeal of these incentives.

Electric car purchases of up to 30,000 euros are expected to be subidized by 20 percent, while a lower subsidy rate of 15 percent is planned for purchases exceeding 30,000 euros.

High-voltage power demand up during lockdown, exchange data shows

Industrial high-voltage electricity demand during lockdown in Greece registered an unanticipated increase, rising by 12.46 percent in March, 21.86 percent in April, 30.62 percent in May and 19.71 percent in June, all compared to the equivalent month a year earlier, according to figures provided by the energy exchange.

Prior to lockdown, high-voltage electricity demand registered a milder 2.46 percent increase in February compared to the same month a year earlier.

Overall, in the first half of 2020, demand for high-voltage electricity rose by 14.87 percent compared to the equivalent period a year earlier, the energy exchange figures showed.

On the contrary, demand for mid-voltage and low-voltage electricity between February and May fell to lower levels compared to last year, according to the energy exchange data, reflecting inequalities in the impact of the pandemic on various economic sectors.

Mid-voltage electricity demand slumped 18.89, 22.43 and 22.08 percent in April, May and June, respectively, compared to the equivalent months a year earlier.

In the low-voltage category, concerning households, electricity demand fell considerably during the five-month period from February to June, registering drops of 6.08, 10.96, 19.1, 12.77 and 18.45 percent, respectively.

Figures provided by power grid operator showed an overall decrease, for all categories, of 4.3 percent in the first half of 2020 and a high-voltage demand decrease of 9.4 percent.

Power demand dives 14.61% in June as tourism slumps

Electricity demand slumped 14.61 percent in June, compared to a year earlier, despite the month’s lifting of lockdown measures, latest Greek energy exchange figures have shown.

June’s drop in power demand, attributed to the unprecedented decline in tourism activity, was even bigger than the declines registered in April and May, 13 percent and 9 percent, respectively.

Numerous hotels and other tourism industry units have not opened for business. Also, flight bans were essentially not lifted until the beginning of this month.

Responding to the drop in electricity demand, energy producers have restricted output by 16 percent.

Natural gas and renewables dominated electricity generation in June. Natural gas-fueled generation covered 36.56 percent of demand, while RES production covered 26.43 percent, the energy exchange’s June report showed. Electricity imports covered 23.93 percent, hydropower 7.43 percent and lignite-fired production 5.64 percent.

 

 

Consumer shifts between independent suppliers at 30%

Roughly 30 percent of electricity consumers shifting from one electricity supplier to another are not moving away from the power utility PPC, as was usually the case up until just a few months ago, but from one independent supplier to another, a reflection of a further increase in competition, to the benefit of consumers, latest market data has shown.

Besides price offers, consumers are now also taking into consideration other factors such as supplier reliability, service standards and provision of supplementary services when choosing suppliers. This broader consideration is seen as a sign of the electricity market’s growing maturity.

Independent suppliers now face bigger bad debt figures as a result of an increase in unpaid receivables prompted by a number of factors, including business closures, consumer departures despite unpaid electricity bills, payment defaults, as well as tax file number changes by consumers seeking escape.

The scale of this undesirable situation for independent suppliers is nowhere near that of the enormous collection problem faced by PPC.

However, the bad debt problem highlights that independent suppliers, as a consequence of their efforts to boost market shares, are now dealing with a growing number of unreliable consumers. It also underlines the market’s tightened cash flow, especially in the business sector, as a result of the pandemic and recession.

REN21 chief: RES policies must also look beyond electricity

Renewable energy sources are gaining greater presence but their growth rate is insufficient to cover gaps in sectors beyond electricity generation, professor Arthuros Zervos, president of REN21, a global energy policy network supporting a rapid transition to renewable energy, has made clear in an interview with energypress.

The main focus is still on electricity generation but it is vitally important that the attention is also turned to other domains such as heating, cooling and transportation, as these fields represent more than 80 percent of energy consumption, Zervos noted, reiterating positions included in REN21’s Renewables 2020 Global Status Report, just presented.

A total of 143 countries implemented decarbonization policies between 2004 and 2019, while green policies for transportation and heating/cooling during the same period were limited to 70 and 23 countries, respectively, the report showed.

Taking a look at the bigger picture of the global energy mix shows that renewable energy sources represented a mere 11 percent of total energy consumption in 2018, the REN21 chief noted.

The RES sector’s share of total energy consumption has increased by just 1.4 percent between 2013 and 2018, from 9.6 to 11 percent, he pointed out.

Fossil fuels maintained a dominant share of total energy consumption, at 79.9 percent, while the biomass sector registered 6.9 percent and nuclear energy 2.2 percent, the REN21 chief noted.

An anemic investment growth rate in green energy and renewables, worldwide, during the age of energy transition is another cause for concern, Zervos underlined.

RES investments grew by just 1 percent between 2018 and 2019 to reach 282 billion dollars, the REN21 head noted.

“The objective should be to accelerate RES growth and not slow it down,” Zervos explained, adding that policies supporting RES growth need to be shaped and supported.

 

PPC broadens next voluntary exit plan, set for September

The board at power utility PPC has decided to broaden its voluntary exit program to include eligible staff from all divisions, currently estimated at between 1,700 and 1,800 employees aged over 55.

However, less than a third of these employees, some 500 in total, are believed to have accumulated pension rights, sources said.

Though this shortfall is likely to discourage employees from taking up the voluntary exit offer, PPC’s chief executive Giorgos Stassis is determined to push ahead with the plan and invite interested parties to lodge their applications between September 1 and 30.

The PPC voluntary exit package offers employees a 20,000-euro bonus payment as an addition to severance pay worth 15,000 euros.

An initial voluntary exit effort already staged by PPC attracted 602 employees from the utility’s Meliti and Megalopoli lignite-fired power stations and a further 123 employees from related subsidiaries, producing annual savings of 48 million euro for the company.

PPC had set an objective to attract some 900 employees from the lignite-fired power stations to its initial voluntary exit plan.

Stassis, PPC’s boss, has promised to soon carry out a targeted recruitment plan for staff with specialized skills, according to Pantelis Karaleftheris, the workers’ representative on the PPC board.

 

First demand response auction in July, TFRM validity to get extra month

The energy ministry, anticipating the European Commission’s imminent approval of Greek government proposals for a demand response mechanism and a transitory flexibility remuneration mechanism (TFRM), has signed related ministerial decisions so that the mechanisms, vital tools for industrial energy costs, can be implemented immediately once Brussels has given the green light.

Official approval of the plans by the European Commission is expected within the next few days.

Power grid operator IPTO has been informed by the ministry so that it can prepare the first demand response auction, seen taking place within July. IPTO announced a registration procedure yesterday, setting a July 23 deadline for applicants.

The TFRM’s validity is expected to run for an additional month, compared to the initial term agreed to by Athens and Brussels, to make up for its delayed delivery.

Over the past few days, Greek authorities have needed to respond to numerous questions forwarded by Brussels officials, seeking explanations and clarification on both the demand response and flexibility mechanisms.

 

IPTO launches tender for Athens area substation upgrade

Power grid operator IPTO has announced a tender for the reconstruction and modernization of the 400-kV Koumoundourou substation serving the wider Athens area, a project budgeted at 46 million euros (57 million euros including VAT).

This facility was constructed in the 1970s, along with four other units, to transmit electricity to the wider Athens area.

The Koumoundourou substation upgrade, one of the projects included in the so-called Eastern Corridor, is expected to be completed in 2024. This corridor also includes the Megalopoli and Corinthos substations, both undergoing upgrades at present.

Interested parties face an August 10 deadline to submit their offers to IPTO, expecting turn-key, ready-to-use delivery.

PPC, heavyweight firm close to big-scale securitization deal

Power utility PPC is believed to be making sound progress in its negotiations with a financial world heavyweight for an agreement on a securitization package carrying unpaid receivables overdue by at least 90 days, making it a high-risk venture, energypress sources have informed.

A deal is believed to be imminent and could be presented to the PPC board next week, the sources noted, adding that an agreement will definitely be finalized within July.

These talks follow PPC’s recent agreement with JP Morgan for an initial, smaller-scale, lower-risk securitization package carrying unpaid receivables of up to 60 days.

PPC secured a cash injection of approximately 250 million euros through this agreement and an interest rate of 3.5 percent, regarded extremely favorable.

The higher risk entailed in the forthcoming securitization package is expected to lead to a considerably higher interest rate than the figure agreed to between PPC and JP Morgan.

Even so, the overall securitization procedure indicates that PPC’s credibility is gradually being restored as major players are showing greater faith in the utility’s ability to handle its unpaid receivables.

Both the previous securitization agreement and the one currently in the making are non-recourse agreements not requiring PPC to provide guarantees.

Debt collection services firm Qualco and legal firms hired by PPC will continue handling the collection effort.

PPC aims to receive approximately 300 million euros for the second securitization package.

Besides the absence of guarantees, the securitization agreements represent yet another source of funding for PPC that is not added to the company’s debt figure.

IPTO board changes following new board for IPTO Holding

Two board members at power grid operator IPTO, Giannis Kambouris and Dimosthenes Papastamopoulos, both choices of the previous Syriza government, are resigning, sources have informed.

Kambouris, also the deputy at IPTO Holding, formed following ownership unbundling at IPTO three years ago, resigned from the IPTO board yesterday.

Papastamopoulos, one of the closest associates of the main opposition Syriza party’s Panos Skourletis, who held the country’s energy portfolio, appears set to submit his resignation.

The replacements of Kambouris and Papastamopoulos could be announced tomorrow at an IPTO board meeting.

An entirely new five-member board for IPTO Holding is expected to be announced at an IPTO Holding annual general shareholders’ meeting scheduled for July 16.

The New Democracy government wants to make changes at IPTO and IPTO Holding for further alignment with its policies.

IPTO chief executive Manos Manousakis will definitely remain at his post, sources noted, adding that his deputy, Giannis Margaris, and board member Iasonas Rousopoulos will both probably also carry on for the time being at least.

Government moving to replace entire IPTO Holding board

The government intends to soon replace all five board members of listed IPTO Holding, its representative in power grid operator IPTO with a controlling 51 percent stake. IPTO was ownership unbundled three years ago.

The energy ministry is expected to propose, as replacements, five new officials on July 16, when IPTO Holding is scheduled to hold its annual general shareholders’ meeting, energypress sources have informed.

A shareholders’ decision on a new five-member IPTO Holding board is one of eight issues on the upcoming meeting’s agenda.

The term of the current board, comprising Iason Rousopoulos, the chief executive, Giannis Kabouris, its deputy, and board members Alexandros Nikolouzos, Konstantinos Karakatsanis and Evaggelos Darousos, expires on December 11 this year.

The existing board has asked shareholders to submit resumes of candidates they wish to propose for the new board no later than 48 hours prior to the July 16 meeting.

The IPTO Holding board change is not expected to impact – at least initially – work proceedings at power grid operator IPTO. Rousopoulos and Kabouris, IPTO Holdings’ chief and deputy, respectively, are also members of the IPTO power grid operator board.

DES ADMIE, the IPTO public holding company, holds a 25 percent share of IPTO and China’s SGCC the other 24 percent.

IPTO’s chief executive Manos Manousakis, who has the faith of the energy ministry and the Chinese shareholder, is expected to remain at his post, despite the changes at IPTO Holding, and orchestrate the sale of a further stake in IPTO. SGCC maintains priority rights in any prospective IPTO privatization procedure.

 

 

Consumer groups testing RAE price-comparison tool, ready for launch

Consumer groups are testing a price-comparison platform for electricity and gas supply that has been prepared by RAE, the Regulatory Authority for Energy, and is now ready for public use after much delay as a result of various difficulties, including technical issues.

The authority’s platform, Paratiritirio, or observatory, aiming to offer consumers easy access to supplier offers and other useful information, appears set for launch, according to Ekpoizo, one of the country’s main consumer groups.

RAE’s platform will offer price comparisons for electricity and gas supply packages concerning household and business categories.

Over the past two or so years, RAE and various consumer groups have received numerous complaints concerning billing information as presented by energy suppliers. Details in fine print have led to higher-than-expected energy supply charges, consumers have complained.

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, Copelouzos end idle joint venture, grounded for years by unions

Power utility PPC and the Copelouzos group have agreed to dissolve a joint venture, PPC Solar Solutions, formed eight years ago for development of retail outlets around Greece for electricity sales, energy services and domestic solar panel installations, but never able to get off the ground.

Fierce and adamant opposition by PPC union groups against the joint venture, formed in January, 2012 as an innovative move – for its time – stifled the business plan.

The Copelouzos group’s Damco held a 51 percent stake in this joint venture, PPC holding the other 49 percent.

In 2017, the power utility’s then-CEO, Manolis Panagiotakis made an effort to revive the idle business plan, but his initiative also sparked a heated response and resistance from PPC unions.