Gov’t also working on support measures for gas consumers

The government is seeking further energy crisis support measures that would also facilitate energy consumer categories not included in relief measures announced so far to deal with the crisis.

The administration’s latest support effort, commented on yesterday by government spokesman Giannis Economou on SKAI TV, is believed to concern natural gas consumers and could entail offering this category installment-based payments for bills.

The administration has already announced subsidies for electricity consumers and, to date, not offered gas consumers any support.

However, the government’s plan, which could also include support measures for the mid-voltage category, is believed to still be at a preliminary stage.

Athens is seeking to mobilize EU member states for the establishment of an EU fund that would compensate energy consumers and ease the cash flow concerns of suppliers. EU leaders will focus on the energy crisis at a summit meeting this week.

Energy minister Kostas Skrekas has just announced an increase of a sum, from 10 million to 40 million euros, to be made available for funding electricity supply reconnection costs of low-income households facing supply cuts as a result of their inability to cover energy bills.


Fears of energy market unpaid receivables rebound growing

Government as well as electricity and natural gas company officials appear increasingly concerned about a rebound in unpaid receivables at energy firms as a result of exorbitant energy price increases faced by consumers.

The scale of the ongoing energy crisis plus the inability of analysts to make confident price projections has government officials scrambling for solutions, including through EU action, that could lessen the energy cost burden for consumers and protect supplier cash flow.

During a meeting yesterday with European Commission Vice-President Margaritis Schinas, Greek Prime Minister Kyriakos Mitsotakis reiterated a European Commission proposal for revisions that could enable energy bill payments through installments.

According to sources, the Greek government could insist on a proposal made by energy minister Kostas Skrekas for the establishment of an EU transitional compensation fund, supported by CO2 emission right revenues, distributing amounts to member states as energy-crisis aid.

The Prime Minister suggested this proposal during his meeting with the European Commission deputy, who did not offer a direct response but indicated that a European solution would be sought during an EU summit scheduled for next week, sources said.

Support for energy consumers would also help the finances of suppliers, who, as a result, would be in a better position to offer energy bill payments through installments.


Market players fear European energy inaccuracies could lead to further woes

Major energy market players agree European energy consumers could face many more rounds of pressure over the next few years as a result of errors and inaccuracies plaguing the EU’s energy transition plan towards renewables.

Energy market players are not doubting the EU’s decarbonization goal, seeing it as irreversible, but do believe the European Commission must rectify, as soon as possible, current mechanism faults and market distortions whose resulting deficiencies are being exploited by traders and monopolies, such as Russian gas giant Gazprom, earning excessive revenues at present.

Europe appears to have trapped itself in mechanisms that do not seem to be working, fueling rising concerns among enterprises and industrial players.

Measures must be taken right now at national and European levels. For instance, windfall profits, sparked by sharp wholesale price increases, need to be stopped through the introduction of related taxes, as has been the case in Spain, market players suggest.

Also, electricity prices need to cease reflecting the spot market’s surging prices and instead be shaped by the actual cost of the energy mix, comprised of low-cost renewables (30-35%), high-cost natural gas (30%), lignite (10%), hydropower (10%), plus imports.

In addition, green PPAs reflecting actual cost need to player a bigger role. In Germany, for example, 90 percent of electricity supply is currently made available through PPAs.

Fearing this crisis could last, industrial players in Greece are moving to secure futures contracts covering supply for the next three to four years.


Natural gas strategic reserve among EU thoughts for crisis

A series of measures to be announced today by the European Commission to help EU member states counter the energy crisis may include a strategic reserve for natural gas, complementing respective supply contracts, for abnormal periods such as the current energy crisis affecting the world, especially Europe.

EU member state participation in this strategic reserve would be optional. The initiative, still at a preliminary stage, is being examined. No decisions have been taken.

The EU’s energy market integration and transboundary grid interconnections have helped avoid even more extreme developments in the current crisis, Brussels has observed.

Measures taken by member states at a national level will need to comply with EU law and not contravene Europe’s energy transition towards renewables, Brussels has made clear.

The European Commission has defended its views on the causes of the energy crisis, insisting that increased natural gas prices have been primarily responsible, while noting that the EU’s Emission Trading System (ETS), through which carbon emission right prices have been driven higher, has played a lesser role.

Heatwave, unfavorable factors prompt energy crisis meeting

The country’s grid capacity is set to be seriously tested for the first time this summer over the next few days when temperatures around the country are forecast to soar to levels of at least 37 degrees Celsius, which is sure to prompt widespread and heavy use of air conditioning systems and lead to a surge in electricity demand.

This anticipated early-summer heatwave will coincide with a combination of unfavorable temporary factors limiting electricity generation.

A crisis team comprised of RAE (Regulatory Authority for Energy), DEPA (gas utility), DESFA (gas grid operator) and IPTO (power grid operator) officials will convene for an emergency meeting today, energypress sources informed, to discuss energy supply as the heatwave nears.

The LNG terminal at the Revythoussa islet off Athens is currently closed for expansion work, now in progress. The Greece-Italy interconnection linking the grids of both countries is temporarily closed until June 21 for maintenance work. The anticipated increased reliance on air conditioners during the heatwave will require greater electricity output from the country’s gas-fueled power stations. Also, higher electricity prices in regional markets have prompted local traders, lured by the higher prices, to increase Greek electricity exports to the north.

Participants at today’s emergency meeting will seek solutions ensuring the grid’s ability to meet heightened electricity demand over the next few days.

CO2 emission right costs have risen over the past three months, especially in May, while fuel and natural gas price levels have also climbed to remain at elevated levels.

These developments have sharply increased prices of electricity futures markets contracts both in Germany, guiding European developments, and in regional markets impacting Greece, namely Hungary, which shapes prices in Balkan countries interconnected with Greece, as well as Italy, a key market also interconnected with the Greek grid.

In Germany, wholesale electricity prices rose by approximately 10 euros per MWh in a month. In Italy, current electricity futures contracts concerning delivery in July are being established at levels of around 75 euros per MWh.

These regional price increases are already impacting the Greek market, where the System Marginal Price, or wholesale price, averaged 56.33 euros per MWh in May. June contracts are being established at 59 euros euros per MWh.

RAE and the country’s operators see all these factors as severe warnings which prompted the need for today’s meeting.







LNG tanker, an energy security measure, on way to terminal

An LNG tanker leased by DEPA, the Public Gas Corporation, planned to dock at the LNG terminal on Revythoussa, an islet just off Athens, as an emergency gas storage facility during the high-demand winter months, is expected to arrive tomorrow or Friday.

The tanker will be used to help maintain a regulation requiring gas-fueled electricity producers to be prepared to operate for five consecutive days if needed by the system. This regulation has not been implemented to date. It was scrapped about seven years ago when the LNG terminal’s storage capacity was deemed inadequate to support the measure.

Certain electricity production units – Elpedison’s two units and a smaller facility run by Heron – have been designed to be able to switch from natural gas to petrol, if necessary.

All other licensed units in operation have agreed to maintain LNG reserves so as to be able to function for five consecutive days.

The five-day reserves requirement will now apply for all electricity production units not equipped to switch from gas to petrol.

The LNG tanker plan, expected to safeguard the country against a repeat of last winter’s energy crisis, is estimated to cost approximately 6 million euros. The measure will be covered through the reimposition of a special supply security surcharge previously included on consumer gas bills.

The surcharge was lifted following the accumulation of a surplus worth between 9 and 10 million euros. Consumers can expect this surcharge to soon reappear on their natural gas bills. It will be maintained until the coffers at DESFA, the natural gas grid operator, are sufficiently filled to cover the cost of the precautionary LNG tanker measure.

Industrial enterprises linked to the demand response mechanism (interruptability) – it enables them to be compensated when the TSO (ADMIE/IPTO) requests that they shift their energy usage by lowering or stopping consumption during high-demand peak hours so as to balance the electricity system’s needs – will be exempted from the supply security surcharge.

Meanwhile, market players have reacted strongly against an additional measure that will require suppliers and producers to sign gas supply contracts for extended periods of roughly two and a half months.


Old surcharge on gas bills back to fund LNG tanker safety plan

A plan by RAE, the Regulatory Authority for Energy, entailing the hiring of an LNG tanker as a storage facility to be moored at the terminal on Revythoussa, an islet just off Athens, is set to be implemented as an additional supply security measure for the crucial winter months.

This solution, expected to cost approximately 6 million euros, will be financed through a Special Supply Security Surcharge to be reimposed on natural gas bills for all consumers.

The surcharge had also been imposed on natural gas bills in the past, raising cash reserves of between 9 and 10 million euros for DESFA, the natural gas grid operator, before being lifted.

It will be covered by all gas supply companies, which will pass on the cost to consumers, as well as gas-fueled electricity producers. Major-scale industrial producers registered for the demand response mechanism (interruptability) will be exempted from the surcharge. (The demand response mechanism enables major industrial enterprises to be compensated when the TSO (ADMIE/IPTO) requests that they shift their energy usage by lowering or stopping consumption during high-demand peak hours so as to balance the electricity system’s needs).

The LNG tanker solution will be adopted to prevent supply problems encountered last winter. Other measures have also been taken but authorities believe these may not suffice should conditions end up being extreme.

RAE appears prepared to adopt the 6 million-euro additional safety measure rather than risk a repeat of the energy crisis last December and February.

“This measure may possibly not be needed in the end. Nobody knows. But it can be considered certain that countering a crisis by using last winter’s tools, such as converting natural gas-fueled electricity production units into petroleum-based units, would end up costing a lot more,” a local authority explained.

The main power utility PPC is now claiming tens of millions of euros for such conversions needed last winter.


All eyes on French energy system as Europe braces for colder weather

Europe’s energy sector enters a crucial period today and for the next few days as a result of the cold winter weather that has been forecast combined with maintenance and operational issues troubling France’s nuclear power facilities, which could lead to energy supply shortages.

Temperatures in Greece and other parts of Europe are forecast to drop by as much as 10 degrees Celsius this week, which will sharply increase energy demand for heating.

Weather conditions are not expected to be as extreme as they were last winter. Authorities have assured necessary measures have already been taken to a large degree.

Even so, the ongoing situation in France is worrisome. Throughout 2017, the country’s output at nuclear power stations has registered the lowest levels since the millennium. Nuclear power station capacity in France yesterday managed to climb to a level of 52 gigawatts.

As reported by Platts, the French power utility EDF has declared five units will resume production this week but, even so, was forced, once again, to reduce its output forecasts as a result of delayed returns to the grid of units undergoing maintenance work.

EDF’s nuclear power stations have generated electricity at an average level of 50 gigawatts this month, while, for the fourth quarter, output has fallen 14 gigawatts short of forecasts, a quantity equivalent to 28 LNG shipments.

Given the magnitude of France’s electricity production, as well as last year’s domino effect of energy shortages experienced by a series of European countries, stemming from problems at French nuclear power stations, all eyes are now on France.



Commercial interest suspicions raised over Italy power link problem

Frequent problems disenabling the Greek-Italian grid interconnection to function for extended periods have raised suspicions that commercial interests, besides technical issues, may also be at play.

The interconnection’s latest breakdown, occurring at a time when crossboundary electricity trade is set to rise, has once again brought the issue to the fore. In response, RAE, Greece’s Regulatory Authority for Energy, and its Italian counterpart, have begun investigating the matter in an attempt to identify the causes behind the regular breakdowns.

The interconnection stopped operating in early October and is not expected to become available again until at least the end of the year.

RAE and Italy’s Terna informed of a technical issue at the Greek-Italian grid interconnection on October 9.

Inspections of the interconnection’s overhead segment in Greece did not reveal any issues, prompting Terna to focus its check on the submarine section, where a technical problem was reportedly identified. A specialized vessel was then recruited for the repair effort. According to initial estimates, work is expected to be completed by mid-December while the interconnection is seen working again within the last yen days of the year.

As a result of the disruption, a mechanism was activated on November 25 requiring RAE and Terna to cover Physical Transmission Rights (PTRs) until the damage is repaired.

Italy’s interconnections with France, Switzerland, Austria and Slovenia also encountered operational problems in October and November.

Grid capacities in the wider region are expected to be tested by extreme weather conditions this coming winter. All these factors combined could prompt a domino effect that may lead to electricity capacity issues in various parts of Europe and increase prices. If so, the adequacy of precautionary measures taken by RAE will be put to the test.

Gas supply security surcharge sum may be used for measures

A plan for precautionary measures aiming to prevent a repeat of the strain felt by the Greek energy system last winter appears to be approaching finalization.

Just days ago, RAE, the Regulatory Authority for Energy, discussed its plan at a meeting involving the participation of the country’s electricity producers, according to energypress sources.

Two basic safety measures have been adopted. Electricity producers equipped with systems able to run on natural gas and diesel will need to be ready to convert whenever requested to do so. This measure concerns facilities operated by the main power utility PPC, Elpedison and a small Heron unit.

The second measure entails the hiring of an LNG tanker to be moored at the country’s terminal on Revythoussa, an islet just off Athens, which is planned to provide supply support to the country’s energy system during the crucial two-month period from mid-December to mid-February.

The LNG tanker will serve as an additional storage facility. A capacity increase project at Revythoussa is not yet ready.

Furthermore, DEPA, the Public Gas Corporation, has reached agreements with Algeria for greater than usual LNG supply orders. The purchase price for these additional LNG amounts has remained unchanged, according to sources.

RAE’s two measures, however, do entail an additional cost. The LNG tanker at Revythoussa will cost between 5 and 6 million euros, according to figures provided by DEPA, which proposed this solution.

Test runs and maintenance work concerning the double-fuel solution offering flexibility at the electricity production units will require an estimated 3 to 4 million euros.

The total cost of the measures is approximately equivalent to a DESFA (natural gas grid operator) cash amount accumulated through a supply security surcharge imposed on natural gas bills. This amount could be used to cover the cost of the measures.

RAE, determined to avoid being criticized for remaining passive, has been exploring precautionary measures since last March, following last winter’s energy supply crisis.

The European Commmissin has also worked intensively to pin-point the causes of last winter’s energy crisis in Europe and provide solutions this season.

Concerns as to what could be in store this winter have intensified as it appears France, a key factor behind last winter’s energy crisis, could face similar problems this season. Maintenance work delays at French nuclear power stations have been reported, while certain nuclear facilities may not be available.

Precautionary systems demanded for PPC Komotini, Lavrio units

RAE, the Regulatory Authority for Energy, is calling for precautionary measures at certain PPC gas-fueled power stations to protect the grid against any extreme gas supply sufficiency issues in the future.

The authority plans to revise production permits concerning main power utility PPC’s natural gas-fueled facilities in Komotini, northeastern Greece, and Lavrio, on the southeastern outskirts of Athens.

The revision, to apply for the utility’s Komotini and Lavrio IV and V units, will require these facilities to maintain independent natural gas reception systems. The cost of these installations will need to be covered by PPC as it is the owner of the aforementioned facilities, RAE has decided.

PPC will be expected to take steps that would ensure uninterrupted operation of these facilities at full capacity for a period of at last five days if natural gas supply is unexpectedly stopped.

As part of the plan, PPC will need to equip the Komotini and Lavrio units with flexibility systems enabling the use of alternative fuels, if needed. More specifically, these units will need to be ready to run on diesel within a few hours of any natural gas supply cut notification by DESFA, the natural gas grid operator.

The RAE plan includes a proposal for the installation of a natural gas storage facility at Lavrio V that would hold enough gas for uninterrupted, full capacity operations at this facility for a period of at least five days.

LNG tanker at Revythoussa a likely precautionary measure for winter

DEPA, the Public Gas Corporation, appears likely to dock an LNG tanker at the LNG terminal on Revythoussa, an islet just off Athens, during the upcoming winter’s crucial two-month period between mid-December and mid-February in order to ensure sufficient gas supply and avoid the energy alerts experienced in Greece last winter.

This plan, involving the participation of RAE, the Regulatory Authority for Energy, is expected to cost approximately 6 million euros and will be covered through a special suppy security surcharge included on consumer gas bills. Local authorities are expected to reach a decision within the next few days.

Other safety measures have already been adopted as it has been determined that regular natural gas supply levels would be insufficient should extreme circumstances arise.

Local authorities appear determined to bring in an LNG tanker to the Revythoussa terminal despite the fact that this precautionary measure may end up proving unnecessary.

“There is a chance of the LNG tanker not being needed. Nobody knows, but it can be said with certainty that countering an energy crisis using last winter’s means – such as switching from gas to petrol at power stations – would cost considerably more,” one official noted.

Without a doubt, RAE does not want to end up being accused of remaining passive should last winter’s extreme events be repeated.

The European Commission has also shown a great interest to fully identify and resolve the causes of last year’s European energy crisis. It wants precautionary measures to be taken.

Concerns as to what could be in store this winter have been on the rise as it appears France, a key factor behind last winter’s energy crisis, could face similar problems this season. Maintenance work delays at French nuclear power stations have been reported, while certain nuclear facilities may not be available.

In Greece, it remains unclear whether an extension to the demand response mechanism (interruptability), a key tool for controlling energy consumption levels, will have been approved in time for the winter. This mechanism enables major industrial enterprises to be compensated when the TSO (ADMIE/IPTO) requests that they shift their energy usage by lowering or stopping consumption during high-demand peak hours so as to balance the electricity system’s needs.

Furthermore, more burdensome surcharges in the making for local electricity producers, as well as the uncertainty as to whether new CATs will have been introduced on time, add to the overall uncertainty in Greece for the winter.


Pipeline gas, LNG imports not enough to prevent new crisis, IEA notes

Last winter’s energy crisis served to remind that abundant natural gas supply, especially LNG, available to the Greek market, as well as the country’s heightened import activity, are not enough to prevent further crises, the International Energy Agency (IEA), noted on Greece in a report examining global gas market supply sufficiency.

The report’s section on Greece was presented in a bid to identify the causes of the wider energy crisis last winter, which also pressured the Greek system.

“Greece is a relatively new gas market but gas plays an important role in electricity generation as it has a 30 percent share (2016),” the IEA report pointed out.

Last year, gas demand in Greece reached four billion cubic meters, of which 68 percent was used for electricity generation and heating, the report noted.

Greece is entirely dependent on pipeline gas supply and LNG imports to overcome periods of heightened demand as the country does not possess an underground gas storage facility – development of a unit in Kavala, northern Greece, is being examined – while LNG storage capacity is limited, the IEA report underlined.

Last winter, electricity demand increased by 12 percent and was primarily covered by gas-fueled power stations, which increased their production levels by 37 percent, compared to the previous year, to 2.1 terrawatt hours (TWh), the IEA report informed.

Gas demand rose by 32 percent last winter and struck an all-time high in January, reaching 637 million cubic meters, 40 percent over the previous record, the IEA report noted.

LNG imports rose by 156 percent and pipeline gas imports increased by 19 percent, to respective levels of 225 and 394 million cubic meters, in order to meet this spike in demand, the report noted.

The IEA report also pointed out the two high-alert periods experienced by Greece’s energy market during last winter’s energy crisis, the first beginning on December 19, to last 13 days, and the second on January 9 for a further 36 days.

A long-term Algerian LNG supply contract helped deal with the crisis, as did an additional shipment from Norway’s Snohvit LNG export terminal, the IEA report stated.

DEPA proposes LNG tanker at Revythoussa for winter needs

DEPA, the Public Gas Corporation, is considering to ship in a floating LNG tanker to the Revythoussa islet facility, just off Athens, as a means of covering the crucial high-demand winter period between mid-December and mid-February and avoiding a repeat of last year’s energy crisis, the gas company has informed RAE, the Regulatory Authority for Energy.

This is seen as an effective solution by authorities but it remains unclear who would be responsible for its cost.

RAE has requested a comprehensive business plan from DEPA for this initiative, sources noted.

Determined to live up to its responsibility as an effective monitoring authority, RAE is just as keen to find a solution that would prevent the energy-related concerns experienced last winter.

Fears of a repeat of last year’s European energy crisis this winter have resurfaced as latest developments suggest a maintenance program concerning certain French nuclear power stations could fall behind schedule, while some nuclear units in this country may need to temporarily stop operating.

Concerns have risen in Greece as an extension of the demand response mechanism (interruptability) for the industrial sector, a key tool for controlling consumption levels, has yet to be approved by the European Commission. The mechanism enables major industrial enterprises to be compensated when the TSO (ADMIE/IPTO) requests that they shift their energy usage by lowering or stopping consumption during high-demand peak hours so as to balance the electricity system’s needs.

Also, it remains uncertain whether the new temporary CAT mechanism, compensating electricity production units for output contributing to the grid’s adequacy and stability, will have been implemented by the winter.

RAE is expecting detailed data from DESFA, the natural gas grid operator, assessing the possibility of a gas shortage risk in Greece this winter and the country’s capacity to reinforce infrastructure.



RAE moving to prevent repeat of last winter’s energy crisis

Driven by the energy crisis experienced in Greece for most of last winter, RAE, the Regulatory Authority for Energy, is taking precautionary measures to avoid a repeat of any natural gas supply shortages next winter.

The authority is currently examining options that could ensure direct supply of additional natural gas supply, should extra amounts be needed.

The insufficient storage capacity at the country’s only LNG terminal at present, on the islet Revythoussa, just off Athens, is a key concern. Construction of an additional third storage tank at this facility has been delayed. To counter the issue, authorities appear likely to lease an LNG carrier as a storage facility to be moored at Revythoussa.

The cost of such a solution could be covered by a reserve amount in an account supported by a supply security surcharge. Another option would be to activate a clause against sub-contractors responsible for the construction delays of Revythoussa’s third storage tank and use the resulting penalty amounts to cover the ship’s leasing cost.

RAE is close to completing an updated risk assessment study that is based on data provided by DESFA, the natural gas grid operator, and support from the National Technical University of Athens (NTUA). RAE has also hired a consultant specializing in risk management for the effort.

RAE working on country’s long-term energy plan, due by end of year

RAE, the Regulatory Authority for Energy, backed by environment and energy ministry, is working on delivering a long-term energy plan for Greece by the end of this year.

The plan will include initiatives to help Greece reach climate change targets the country agreed to, for 2030, at the COP21 climate conference in Paris late in 2015, and also detail energy market revisions, including pricing issues.

The European Commission’s recent winter package, announced in November, requires all EU member states to prepare national energy and climate plans, based on 2030 targets, within 2017.

RAE has assumed the task of preparing a plan based on new conditions and needs. It will provide  proposals for revisions to the country’s energy portfolio, detailing necessary investments and infrastructrure, all in line with EU directives.

Besides ensuring a gradual expansion of the renewable energy sector, the RAE plan will also aim to achieve a balanced mix of energy-generating technologies, improve energy efficiency, and further diversify conventional energy sources through the development of new pipelines, refineries, natural gas and oil storage facilities, electicity network interconnection projects, and smart meters capable of handling renewable energy output fluctuations.

The RAE plan will also provide prerequisites needed for the establishment of a modern energy market for electricity and gas. Its framework will include features such as a secondary market.

Lessons learnt from the energy supply crisis last winter will help shape the long-term energy plan.


RAE taking gas-sector action to prevent energy crisis next winter

RAE, the Regulatory Authority for Energy, is preparing measures to prevent a repeat of the energy crisis experienced by the country last winter, in December and February.

The authority is aiming to implement protective measures prior to further gas market reforms through a target model, now a Greek bailout requirement, expected by September.

As the overall effort’s first move, RAE will prepare a risk assessment study concerning natural gas supply security in Greece. RAE will use data to be provided by DESFA, the natural gas grid operator, and the National Technical University of Athens (NTUA), to update a previous risk assessment study.

RAE plans to then swiftly introduce a series of measures. It is anticipated that these will include an existing plan concerning licensing requirements for power generating units. Power stations must guarantee their ability to operate uninterruptedly over five-day periods during emergencies to satisfy this specific licensing term.

With this requirement in mind, certain power units – two operated by Elpedison and a small Heron facility – are equipped to run on alternative fuels, allowing a switch from natural gas to fuel whenever needed. RAE is expected to soon clarify how such units will be compensated for their flexibility.

Power units not equipped to switch to alternative energy sources will need to maintain specified fuel reserves, an older requirement abandoned several years ago but now set to be reintroduced and remain effective until a third tank is added at the LNG terminal on Revythoussa, an islet just off Athens. This project has been severely delayed.

The use of a floating LNG tanker, which would be moored off the Revythoussa facility during periods of high energy demand, is being contemplated as a temporary solution until the terminal’s third storage tank is completed. The cost of such a solution could be covered by cash reserves raised through a supply security surcharge. The amount in this coffer is estimated to now be worth around 8 to 9 million euros.

Authorities are also considering taking action against contractors responsible for the delay of the third Revythoussa tank’s delivery. The amount that could result from penalty payments, if such a course is pursued, could be used to hire a LNG tanker for tempotary use.

Low hydropower unit water levels may spark summer energy crisis

Low water levels at hydropower station reservoirs in many European countries threaten to cause a series of electricity supply problems around the continent. A repeat of the past winter’s energy crisis cannot be ruled out if extremely high temperatures prevail and various emergency cases arise.

As was pointed out in a recent article published by the Argus media group, current water reservoir shortages are altering European electricity market dynamics and the situation is expected to extend into the long term.

Extremely low temperatures experienced around Europe in December and January prompted energy shortages and forced authorities to increase their reliance on hydropower stations. This development severely depleted water reserves.

Greece was no exception. The energy crisis that affected the country between December 19 and February 13 significantly lowered Greek reservoir water levels.

In January, the country’s hydropower stations needed to increase their electricity generation by 66 percent, compared to the equivalent month a year earlier. Hydropower output during the first month of this year reached 658 GWh, up from 396 GWh in January last year.




RAE presents action to be taken following energy crisis

RAE (Regulatory Authority for Energy) officials admitted that serious problems for Greece’s energy system continue to exist for the upcoming summer and next winter at a recent ad hoc meeting staged by IENE, the Institute of Energy for South-East Europe.

The event was held in view of the significant problems recently faced by Greece’s energy system, when the country’s electricity network nearly collapsed on two occasions and blackouts were averted only in the last minute.

Greek energy authorities examined the perilous state that the electricity and gas infrastructures found themselves in when demand soared for many days in subzero temperatures.

Nikos Boulaxis, chairman at RAE, admitted that Greece’s energy system was pushed to its limits during the energy crisis but overcame the challenge as a result of good coordination and a stroke of luck.

Boulaxis listed a series of measures to be taken by RAE in response to the energy crisis. These include an assessment of all competitive energy markets, to lead to regulation revisions; a road map to be prepared for natural gas market revisions; a review of the country’s gas infrastructure, with emphasis on a prospective third tank at the Revythoussa LNG terminal; the establishment of a new mechanism to monitor developments in neighboring markets so as to enable Greece to be better prepared; and the introduction of a new flexibility mechanism.

Event participants noted that elevated System Marginal Price (SMP) levels were not attributed to electricity producer offers but the formula applied to determine hydropower offers.

The market’s failure to reflect the high demand amid energy crisis conditions in natural gas and electricity prices was highlighted.  The SMP in Greece reached 75 euros but was more than double this amount Bulgaria and Romania.

The low SMP levels in Greece resulted from overstated figures provided by PPC for lignite-fired stations. This ruled out imported electricity amounts, which have traditionally partially covered domestic demand, and, in addition, prompted electricity exports to foreign markets that ensured better prices for electricity production for as long as an export ban was not imposed.

Another failure, as was pointed out at the IENE meeting, was the complete failure by authorities to forecast the energy crisis, despite the availability of indicative figures from as early as September and October.

According to RAE conclusions drawn from the winter’s energy crisis, the demand response mechanism – enabling major industrial enterprises to benefit from electricity cost savings in exchange for shifting energy usage to off-peak hours whenever required by the operator – was effective.

Besides RAE, other energy sector authorities represented at the IENE meeting included: PPC, the main power utility; IPTO, the power grid operator; DEPA the Public Gas Corporation; RES producer associations; electricity suppliers; natural gas traders; HEDNO, the Hellenic Electricity Distribution Network Operator; EDA, the gas network operator; and ELPE, the Hellenic Petroleum.





Energy crisis normalized with latest LNG shipment arrival

The local energy warning system has finally been downgraded following yesterday’s arrival to Greece of a 120,000-cubic meter LNG shipment from Algeria, one of many extraordinary orders required during this winter’s energy crisis.

The order’s arrival, shipped to Greece’s only LNG terminal on Revythoussa, an islet just off Athens, prompted authorities to lower the country’s energy warning system to Level 1 Alert, two months after it had been raised to Level 2 Alert.

No distressing energy-related developments are now seen for the near future. Though the energy warning system’s lowering to Level 1 Alert means that further emergency measures are now not required, authorities will need to keep monitoring the situation.



DEPA pivotal in energy crisis with triple-sized gas orders

The latest round of pressure felt by the energy system is not as acute as the wave experienced over recent weeks, RAE, the Regulatory Authority for Energy, determined at a meeting yesterday, and, as a result, set a natural gas consumption limit of 90,000 MWh per day for natural gas-fueled power stations.

DEPA, the Public Gas Corporation, which has played a pivotal role in the situation this winter, informed that a new LNG shipment from Algeria is currently being loaded and expected to arrive at Greece’s terminal on the island Revythoussa, just off Athens, this coming Monday.

Authorities have decided that the main power utility PPC’s production units in Lavrio, southeast of Athens, and Komotini, northern Greece, as well as the independent producer Heron’s unit in Viotia, slightly northwest of Athens, will, in the coming days, need to switch to fuel-fired electricity production to the extent considered necessary by IPTO, the power grid operator.

This is not the first time DEPA has needed to step in and play a pivotal role in the effort to ensure the country’s energy adequacy over the past couple of months. Natural gas demand generated by the number of independent electricity producers operating in Greece rose sharply in December and January.

DEPA has needed to make seven extraordinary LNG orders, two of which were shipped in by large-capacity tankers carrying 120,000 cubic meters, to deal with the exceptionally high gas demand this winter, triple the usual amount.

The reduced electricity output in France as a result of the country’s temporary closure of nuclear power stations deprived the European electricity grid of considerable electricity amounts. Major electricity amounts needed to be imported into France from Europe, including Greece.

Under normal circumstances, roughly 15 percent of Greece’s electricity requirements are covered by imported electricity, primarily through interconnections with neighbors in the north and, to a lesser extent, Italy and Turkey.

This winter, the electricity amount that is usually imported into Greece needed to be generated domestically. Technical problems with the Italian interconnection, eventually repaired in late January, also played a role in this winter’s energy crisis experienced in Greece.