Pilot auction for 200-MW RES units combining energy storage worked on

A new RES support framework prepared by the energy ministry for the European Commission to examine includes provisions for a pilot auction offering tariffs to 200-MW RES projects combining energy storage, energypress sources have informed.

This is the first time a specific tariff-related procedure is being prepared for this category of projects, expected to play an instrumental role on the country’s energy map in the years ahead.

However, it remains unclear when such RES production-energy storage project combinations could mature.

A recent legislative revision delivered by the energy ministry freezes, until the end of the year, applications and issuance of production licenses, environmental permits and connection terms for energy storage projects combining RES units until a related framework is, in the meantime, established.

The new RES support mechanism, nearing finalization as details are being worked on by energy ministry and Brussels officials, is expected to facilitate the continuation of competitive procedures for tariffs until 2025.

 

 

Ministry bill for small-scale PVs without competition procedure

The energy ministry has submitted legislative revisions to Parliament facilitating the installation of small-scale PVs, up to 500 KW, without competitive procedures as long as interested parties do not already own two such units that have also been installed without competitive procedures.

The draft bill also includes a revision designed to rectify unfair terms of the past for small-scale PVs on non-interconnected islands by offering 10 percent tariff increases for their output.

Another article in the bill enables older RES projects with licenses including provisions for the installation of connecting cables to now be developed without cable links if the hosting island has been interconnected or is in the process of being interconnected.

The bill also transfers distribution network operator DEDDIE’s assets on Crete to power grid operator IPTO, a pending issue that must be resolved for the launch of market activity concerning the island’s small-scale interconnection with the Peloponnese.

RES capacity boosted, auctions to be extended until 2025

Greece’s new RES support mechanism, whose details are being finalized in talks between the energy ministry and European Commission officials, is expected to offer producers greater capacities, maintain the current system of 20-year tariffs for output through auctions, which will run until 2025, not 2023, as was originally planned.

The changes reflect the country’s revised and more ambitious National Energy and Climate Plan (NECP), aligned with loftier EU objectives for a greater number of RES installations.

The new auctions will be mixed, enabling the participation of both solar and wind energy producers, but wind energy producers will be entitled to at least 30 percent of capacity offered at each auction.

The country’s original RES auction plan, drafted by former energy minister Costis Hatzidakis, now holding the labor and social affairs portfolio, had proposed 6 RES auctions each offering 350 MW for a total of 2.1 GW, but this total is now expected to be raised to at least 3 GW.

RES tariffs remunerating output have fallen considerably at recent RES auctions, driven lower by the intensified competition.

Also, the plan appears likely to include special geographically based RES auctions covering areas such as Crete, Evia and the Cyclades, as well as provisions for small-scale PV installations.

 

RES simplification, energy storage bills in September

The energy ministry plans to submit a draft bill to Parliament in September, following public consultation, for a second round of RES licensing simplifications concerning new projects.

During this time, the ministry intends to have also finalized and forwarded its legislative framework for the emerging energy storage sector, to play a crucial role in the country’s ambitious RES output targets.

The energy ministry plans to jointly submit the RES licensing simplification and energy storage bills to Parliament.

The new RES licensing simplification revisions will be based on a key proposal made by the energy ministry’s secretary-general Alexandra Sdoukou, heading the ministry’s RES licensing committee, entailing the termination of non-binding connection offers.

Instead, investors behind new RES projects will directly proceed to applications for finalized connection offers, once environmental permits have been issued.

Also, RES investors will be set time limits to submit installation permit applications for projects. Time will begin counting as soon as the investors have accepted finalized connection offers. If the time limit is not met, RES production certificates for corresponding projects will automatically expire.

According to the ministry plan, PV projects, land-installed wind turbines and hybrid stations will be given 12-month periods, while all other RES technologies and combined cooling, heat and power (CCHP) units will have 18 months.

Licensing authorities will also be set time limits, according to the plan. They will be given 20-day limits to request any additional information or clarification from investors. Also, authorities will have 20 days to issue RES licenses once applications are deemed complete.

Market Reform Plan, Adequacy Report rush ahead of break

The energy ministry is striving to offer a swift response to a set of European Commission queries concerning Greece’s updated Market Reform Plan, forwarded for public consultation by RAE, the Regulatory Authority for Energy.

The energy ministry is aiming to submit a finalized plan to Brussels by the end of July, so that the European Commission can process and approve the plan before its officials take off for their summer breaks in August.

The queries forwarded by the European Commission primarily seek clarification and do not raise any fundamental issues, which has given Greek officials hope of the plan’s imminent finalization.

Brussels’ approval of the Market Reform Plan is crucial as it is one of two prerequisites faced by Athens before the government can submit an application for a support mechanism, either a Strategic Reserve, which would compensate power utility PPC for maintaining its lignite-fired power stations on emergency stand-by, or a Capacity Remuneration Mechanism.

The second requirement is Brussels’ approval of an Adequacy Report being prepared by IPTO, Greece’s power grid operator. Its finalization was originally planned for the end of July but this aim now seems set to be delayed by a week or two.

New low-end income category for energy efficiency upgrade subsidies

The energy ministry plans to add a sixth income bracket, covering low-income earners, to a latest and forthcoming edition of a Saving at Home program subsidizing energy efficiency upgrades of homes.

The additional category, promising to offer greater subsidy amounts for low-income earners, will apply for individuals with annual income levels of up to 5,000 euros and families with total annual income of up to 12,000 euros.

Applicants belonging to this category will be entitled to subsidies covering up to 65 percent of energy efficiency upgrade costs at homes.

According to sources, a project-cost maximum of 50,000 euros will be applied.

The latest edition of the Saving at Home, close to being finalized, is set for pre-announcement in preparation for the subsidy platform’s September launch.

Details imminent for next energy-efficiency subsidies offer

The latest edition of the Saving at Home program subsidizing energy efficiency upgrades of homes is just about ready. Its details will most likely be announced next week by energy minister Kostas Skrekas in preparation for a launch of the applications platform in September, sources have informed.

The new edition will aim for energy efficiency upgrades of 50,000 homes and investments totaling one billion euros, the energy ministry’s secretary-general Alexandra Sdoukou informed during a speech at a recent TEE (Technical Chamber of Greece) event.

As has previously applied, applicants will need to submit plans upgrading the energy-efficiency ratings of their homes by three levels, determined by a points system, in order to qualify for subsidy support.

A revised appraisal system will be introduced. It will factor in the degree of energy savings promised by respective home upgrades as well as a points system with factors such as regional climate conditions; existing energy-efficiency ratings of buildings; age of buildings; as well as income levels of applicants combined with social criteria such as unemployment records, disabilities and single-parent family status.

Revision for Crete assets transfer to IPTO this week

The energy ministry is set to submit to Parliament a legislative revision needed for the transfer to power grid operator IPTO of distribution network operator DEDDIE/HEDNO’s assets on Crete, a pending issue that must be resolved for the launch of market activity concerning the island’s small-scale interconnection with the Peloponnese.

The transfer of DEDDIE/HEDNO’s assets on Crete to IPTO is essential for the latter to take on the responsibility of the small-scale interconnection. IPTO cannot take on this task until a 150-kV transmission line remains under the control of power utility PPC, DEDDIE/HEDNO’s parent company.

The legislative revision will be submitted to Parliament by the end of this week, barring unexpected developments, as an attachment to a draft bill concerning waste management, energypress sources informed.

In a concurrent development, RAE, the Regulatory Authority for Energy, has approved an Energy Exchange proposal concerning the island’s entry into target model markets.

The authority and other agencies involved in this procedure presented a hybrid model that will remain valid until the completion of Crete’s major-scale interconnection with Athens.

 

DEPA Infrastructure revisions, for clarity, in Parliament, sale deadline nearing

A legislative revision prepared by the energy ministry for DEPA Infrastructure, containing measures that aim to offer greater clarity to bidders in the ongoing sale of the gas company, has been submitted to Parliament.

DEPA Infrastructure suitors face a July 15 second-round deadline for binding bids.

The legislative revision includes provisions for 30-year extensions of gas distribution licenses as well as the creation of a new mechanism enabling required revenue recovery underperformance by one of the country’s three EDA distribution company to be covered by the other EDA companies, through revenue offsetting procedures concerning equivalent periods.

If this procedure fails to resolve required revenue recovery underperformances, then any discrepancy will be covered through  price adjustments at all three EDA companies.

 

Ministry puts brake on RAE-licensed energy storage plans

The energy ministry is stopping the implementation of RAE (Regulatory Authority for Energy)-licensed energy storage station plans as it wants to avoid priority treatment in power grid operator IPTO’s examination of connection-term applications submitted by investors already holding production licenses.

The ministry intends to first ensure the induction of investment plans already holding production licenses into the new, soon-to-be-legislated licensing framework for energy storage units before all investment plans, old and new, are examined from scratch, to determine the processing order of IPTO connection-term applications.

According to energypress sources, the government was never in favor of a policy pursued by RAE to license energy stations despite the absence of a legislative framework for this sector.

The majority of RAE’s energy-storage licenses have been granted through an existing framework for natural gas-fired power stations, used as a surrogate framework.

According to data recently presented by RAE president Athanasios Dagoumas, the authority, since 2019, has received a total of 98 applications for energy storage, pumped storage and hybrid units representing a total capacity of 8,213 MW.

By April, this year, RAE had issued production licenses for the majority of these applications, while the examination of a further 34, representing a capacity of 4,519 MW, was pending.

Combination of events pushing electricity costs higher

Higher-priced electricity, globally, may have arrived to stay given the combination of events such as the sudden rebound of the global economy, which is intensifying demand for fuels, metals and electricity, as well as the European Green Deal, new climate change laws and more ambitious carbon neutrality targets, pushing up CO2 emission right prices.

In Greece, wholesale electricity prices have risen sharply in recent days, to levels above 100 euros per MWh, the heatwave conditions exacerbating the situation. CO2 emission right prices have reached 55 euros per ton, from 32 euros per ton at the beginning of the year. The market clearing price for June is estimated to be 79.33 euros per MWh from 59 euros per MWh in December.

Major electricity suppliers in the Greek market expect the wholesale price to settle at 83-84 euros per MWh in the next month before rising to 85 euros per MWh over the next few months, and reaching 92 euros per MWh towards the end of the year.

Wholesale price clauses included by suppliers in their agreements with consumers for protection against higher prices are well below the aforementioned projections, meaning consumers should soon expect considerably higher electricity costs if these forecasts prove to be accurate.

Even if eventual electricity cost hikes turn out to be milder, RAE, the Regulatory Authority for Energy, and the energy ministry will be bracing for a bigger wave of consumer complaints.

 

Market Reform Plan draft at EC, strategic reserve by end of year

A draft of the country’s Market Reform Plan, whose finalized version will carry target model market revisions for Greece, has been forwarded, by the energy ministry, to the European Commission for consultation between the two sides, expected to begin without delay.

The energy ministry and Brussels have also agreed on a timeline concerning Athens’ submission and examination of a proposal for a Strategic Reserve Mechanism, needed to ensure electricity supply security through the market’s transition and reforms.

Based on this schedule, the two sides will strive to have finalized the Strategic Reserve Mechanism by the end of the year, so that it may be launched in early 2022.

Brussels’ Directorate-General for Competition plans to begin its consultation for the Market Reform Plan in July. The procedure is expected to last four months, before target model market revisions are implemented.

As part of the overall effort, Pantelis Kapros, Professor of Energy Economics at the National Technical University of Athens, conducted a study – commissioned by RAE, the Regulatory Authority for Energy – serving as a road map for the Greek wholesale electricity market’s revisions, the objective being to fine-tune the target model.

Power grid operator IPTO will concurrently conduct a new adequacy report, including reliability standards, to accompany the Greek plan.

RES auction plan to be unveiled July, solution for saturated spots

The country’s new RES auctions plan, designed to offer investors six mixed wind and solar energy auctions until 2024, each with a capacity of 350 MW for a grand total of 2.1 GW, is expected to be announced in July, enabling preparations for the first of these sessions to begin in autumn.

Energy ministry officials have been involved in a series of virtual meetings with Brussels authorities for the new RES auction plan, the latest session taking place last week.

As previously reported by energypress, the negotiations have focused on specific details, not structural matters, concerning the new RES auction plan.

The provision of an additional 1-GW capacity for projects under special categories, including small-scale units with capacities of up to 1 MW, is considered a certainty.

In addition, ministry officials are confident Brussels will endorse a Greek proposal making available a portion of this additional 1 GW for saturated areas, namely the Cyclades, Crete, Evia and the Peloponnese.

The agenda for the ongoing talks does not include RES auctions for offshore wind farms, from the additional 1-GW capacity for special-category projects, energy ministry officials pointed out.

Any RES auction progress for offshore wind farms will need to wait until conditions have matured for the establishment of a support framework. This will need to be preceded by a legal framework.

 

Letters of guarantee at €35,000 per MW possible for bigger PVs

RES investors applying for producer certificates concerning facilities over 1 MW may need to also submit accompanying letters of guarantee worth 35,000 euros per MW as part of the application process, the objective being to make this procedure more demanding and restrict applications to investors with serious intentions of following through on their plans.

Heightened investment interest has led to an overheated RES market, especially in the large-scale PV category, prompting saturation at various stages of the licensing process.

Restricting applications to investors with serious intentions will help free precious system capacity currently taken up by PV investors acting in a haphazard fashion without full commitment to their plans.

If the measure is eventually implemented, an investor behind a solar energy project plan with a capacity of 50 MW, for example, will need to submit a letter of guarantee worth 1.75 million euros.

The energy ministry does not intend to take immediate action but is likely to adopt a wait-and-see approach over a six-month adjustment period before deciding on whether to require letters of guarantee.

 

Energy ministry pushing ahead with CRM despite Brussels doubts

The government is pushing to deliver, as soon as possible, to Brussels its plan for a Capacity Remuneration Mechanism (CRM), a challenging endeavor given the strict stance maintained by the European Commission’s Vice-President Margrethe Vestager during her meeting with energy minister Kostas Skrekas last month.

RAE, the Regulatory Authority for Energy, assisting the government’s effort with swift progress on preliminary procedures, has commissioned consulting firm E3-Modelling, a decision based on its specialized skills, to prepare an implementation plan, required by Brussels, in order to help eliminate regulatory distortions or market failures.

Vestager, at her meeting with minister Kostas Skrekas in May, made clear that Greece will need to incorporate its strategic reserve model – remunerating units made available by electricity producers for grid back-up services – into a wider Capacity Remuneration Mechanism.

The Brussels deputy, also the Commissioner for Competition, has demanded a new grid sufficiency study and the reserve mechanism’s restructuring from scratch, aligned with EU directives.

Besides remunerating power utility PPC facilities for grid back-up services, the mechanism will also need to incorporate a demand response system.

Brussels officials have indicated the Greek plan will need to have a short duration.

The E3-Modelling company’s team includes Pantelis Kapros, Professor of Energy Economics at the National Technical University of Athens, who possesses a high level of expertise in European energy market reforms, as well as other officials with the necessary expertise, to help the authority complete its task within the limited time given by the government.

Ministry, DG Comp continuing talks on new RES auctions

The energy ministry and Brussels’ Directorate-General for Competition are continuing negotiations aiming to shape Greece’s new RES auctions from 2021 to 2024, the attention of these talks focused on details of the Greek proposal, not its overall structure.

Ministry officials are hoping the Brussels authority will offer its endorsement of the plan within the summer so that the first session of the new-look RES auctions can be announced in September and staged within 2021.

No changes to the fundamental structure of the Greek plan are expected. The ministry has proposed six mixed RES auctions (wind and solar) by 2024 and 350-MW capacities on offer at each session.

In its effort to ensure a balance in the opportunities for wind and solar projects at these mixed RES auctions, the ministry has proposed that either technology secures no less than 30 percent of the tariff agreements at each session.

Such a term is deemed necessary as protection for wind energy projects, facing far higher equipment costs than solar energy projects, and, as a result, unable to follow PVs along a path of reduced tariff offers. No wind energy projects secured tariffs at the most recent RES auction, last month.

Greece’s proposal for the inclusion of an additional 1 GW capacity into the new RES auction format, as a reserve amount for auctions to concern a series of special RES categories, is one of the aspects being negotiated.

Ministry committee set to deliver energy-storage framework plan

Facilities operating purely as energy storage stations will be placed under one category for licensing and regulatory purposes, while a separate category will be established for operations combining storage and RES stations, according to a proposal being prepared by a special committee assembled by the environment and energy ministry.

Also, all electricity markets, such as the day-ahead, intraday and balancing markets, will be open to all energy storage units, regardless of category, according to sources.

Units operating as energy storage stations, alone, are likely to receive licenses through an existing framework already used to grant licenses to natural gas-fired power stations, sources informed.

RAE has resorted to this existing framework as a solution to offer production licenses to a number of companies that have lodged applications for large-scale battery facilities.

The committee, set to stage its final session tomorrow, is expected to present a finalized proposal early next week to authorities, including political officials, RAE, the Regulatory Authority for Energy, energy market operators, and the energy exchange.

The energy ministry, placing great emphasis on energy storage as part of the country’s decarbonization strategy, intends to forward the committee’s framework plan for public consultation at the end of June. The ministry plans to submit a related draft bill to Parliament by October 31.

Strategic reserve milestones set for next two months

A series of milestones have been set until autumn in preparation for Greece’s prospective Strategic Reserve Mechanism, which, if achieved, will enable its launch towards the end of the year.

The timeline and milestones leading to the possible launch of a Strategic reserve mechanism, keeping certain generation capacities outside the electricity market for operation only in emergencies, was discussed in detail during an online meeting yesterday between energy minister Kostas Skrekas and European Commission authorities.

Strategic reserves can be necessary to ensure security of electricity supply when electricity markets are undergoing transitions and reforms and are meant to insure against the risk of a severe supply crisis during such transitions.

Three main prerequisites will need to be satisfied by the end of July, the first being the completion of a market reform plan, intended to intensify competition in the wholesale electricity market.

The plan’s preparations will include the involvement of Pantelis Kapros, Professor of Energy Economics at the National Technical University of Athens, according to sources.

A new adequacy report, or updated study on grid sufficiency proving the need for the introduction of a Strategic Reserve mechanism, will also be needed.

Thirdly, the energy ministry will need to have fully responded, within the next month, to an extensive set of questions forwarded by European Commission officials on the prospective mechanism.

If these steps go well, an indefinite prospect at present, then a clearer picture on the mechanism’s details should have emerged by early autumn.

Any Strategic Reserve formula reached will need to be applied for a brief period so that an ensuing Capacity Remuneration Mechanism, to support new natural gas-fueled power stations, can immediately follow, the European Commission’s Vice-President Margrethe Vestager, also Brussel’s Commissioner for Competition, appears to have made clear to Skrekas, the energy minister, at a recent meeting.

Meanwhile, power utility PPC’s updated decarbonization plan is aiming for a withdrawal of all its lignite-fired power stations by 2025, at the very latest.

 

Environmental permit bid by Eunice for 106 turbines on 14 islets rejected

The energy ministry’s environmental division has rejected an environmental permit application submitted by Kykladitika Meltemia, a member of the Eunice Energy Group, for an investment plan entailing the installation of 106 wind turbines, promising a total capacity of 486 MW, on 14 uninhabited islets in the Aegean Sea.

The company submitted its environmental permit application in November, 2018 for its project, dubbed Aegean. Many months of public consultation on the project’s environmental impact plan followed before the ministry’s decision to reject the Kykladitika Meltemia application was eventually announced yesterday.

The company’s environmental permit application was rejected as the proposed project’s environmental repercussions were deemed significant, meaning environmental neutrality at the project’s various sites could not be assured, the ministry explained, citing a related EU directive.

The project’s spatial plan overlaps into a total of 16 Natura 2000 protected zones, the ministry noted.

Brussels strategic reserve conditions discussed by RAE, IPTO, ministry

A new adequacy report and a new market reform plan, two conditions set by the European Commission for Greece’s adoption of a strategic reserve mechanism, have been discussed during an online meeting between RAE, the Regulatory Authority for Energy, power grid operator IPTO, and the energy ministry.

The European Commission’s Vice-President Margrethe Vestager, also Brussel’s Commissioner for Competition, during a preceding meeting, earlier last week, with energy minister Kostas Skrekas, called for a new adequacy report, in other words, an updated study proving the country’s need for a strategic reserve mechanism to cover actual grid needs.

The Brussels official also requested a new market reform plan detailing reforms designed to intensify competition in the wholesale electricity market.

Pantelis Kapros, Professor of Energy Economics at the National Technical University of Athens, has been asked to contribute to this new market reform plan, sources informed.

Besides the strategic reserve mechanism, RAE, IPTO and energy ministry officials also discussed details on prospective power purchase agreements (PPAs) between industrial enterprises and RES producers.

Vestager, at her meeting with Skrekas, the energy minister, recommended that Greece follow the examples of PPA models adopted by other EU member states, such as Spain.

Prinos support package, worth €100m, submitted to Parliament

A financial support plan for upstream company Energean’s Prinos field, south of Kavala, comprised of a state-guaranteed commercial loan of 90.5 million euros for the group’s domestic subsidiary, plus a supplementary loan of 9.5 million euros from the Greek State, has been submitted to Greek Parliament for approval following its endorsement by the European Commission.

The financial support to be offered for Energean’s Prinos field, based on a temporary EU support framework established to offer economic support in response to pandemic-related effects, will be provided by December 31, 2021, used to cover Energean’s investment and working capital needs over 12 months, and will have a maximum duration of 8 years.

The European Commission offered its approval of the support package as it deemed that Energean generates the greatest proportion of its domestic revenues through the sale of crude, acknowledging this activity has been hit hard by plummeting oil prices amid the pandemic, making it difficult for the company to gain access to capital markets.

According to the company’s results for 2020, announced at the end of April, Energean’s Greek subsidiary incurred operating losses of 83.4 million euros in 2020, forcing its parent company to provide it with 62.4 million euros during the year.

According to sources, Energean’s Prinos activity lost 120 million euros over the two-year period covering 2019 and 2020.

Despite improved oil price levels, more recently, the subsidiary’s inability to invest as a result of a lack of financing has led to a further reduction of production, which is expected to lead to losses of approximately 40 million euros this year.

Details, not structure, holding back RES auction plan talks

Ongoing negotiations between the energy ministry and the European Commission’s Directorate-General for Competition for Greece’s new RES auction system are currently being held back by Brussels concerns over certain details of the Greek proposal, not its overall structure.

The energy ministry is prepared, if needed, to remove aspects causing issues so that negotiations on the new RES auction plan can be completed as swiftly as possible, sources have informed.

The new RES auction plan could be approved within the current summer, according to the more optimistic of forecasts, while the first RES auction under the new framework could be staged towards the end of this year.

At present, local officials are awaiting comments from Brussels following a Greek response to questions prior to Greek Orthodox Easter a couple of weeks ago. Ministry official are hoping Brussels’ comments will be kept to a minimum, which would pave the way for the RES auction plan’s approval.

According to the new RES auction plan, six combined solar and wind energy RES auctions will be staged until 2024, offering a total capacity of 350 MW at every session, for an overall capacity of 2.1 GW.

Subsidy plan for electric vehicle recharging units in the making

The energy ministry has begun preparing a support facility, as part of the country’s recovery plan, for the development of electric vehicle recharging infrastructure.

A total of 220 million euros in recovery fund subsidies will be made available for the development of electric vehicle recharging infrastructure and replacement of public transportation buses covering the Athens and Thessaloniki areas.

The ministry’s subsidy plan for recharging stations will apply throughout Greece, covering locations such as airports, highways, as well as petrol stations.

The ministry has already agreed to receive support from JASPERS, a technical assistance facility prepared by the European Commission to help with preparations for major infrastructure projects.

According to sources, the ministry intends to announce the subsidy program in the second half of the year.

Competitive procedure for RES units over 250 MW examined

The energy ministry has begun considering a competitive procedure specified for wind and solar energy parks with capacities of over 250 MW, a move prompted by the European Commission’s clear-cut opposition to individual investor initiatives for RES projects of such scale, sources have informed.

However, it is still too early to tell if the ministry will end up implementing any such plan.

The European Commission, in response to a related enquiry made by the ministry, noted it cannot endorse any reference price formula for individual wind and solar energy project initiatives of such scale, stressing that such plans have not been endorsed by Brussels anywhere in the EU.

A number of investors are believed to have expressed strong interest to the energy ministry for the development, based on individual initiatives, of wind and solar energy parks with capacities exceeding 250 MW.

PPC strategic reserve, lignite exit compensation hopes fade

Power utility PPC’s prospects for some type of compensation in the foreseeable future, either through the Strategic Reserve Mechanism for the corporation’s withdrawal of units from the market and availability for back-up services, or for the utility’s earlier-than-planned closures of lignite-fired power stations, appear to have dwindled.

The reduced likelihood of any such compensation money for PPC became apparent at a meeting yesterday between energy minister Kostas Skrekas and the European Commission’s Vice-President Margrethe Vestager, also Brussel’s Commissioner for Competition.

Progress was made on an antitrust remedy, through which PPC will soon begin offering rival suppliers lignite-based electricity packages, but the same cannot be said of the strategic reserve.

Vestager made clear, during yesterday’s session, that a strategic reserve plan proposed by the Greek government cannot be approved by the European Commission. Instead, she noted, a new grid sufficiency plan, one aligned with EU directives, will need to be prepared to enable the implementation of an acceptable mechanism.

Subsequently, a strategic reserve plan must be  prepared from scratch, incorporating, besides PPC’s facilities, the demand response mechanism.

According to estimates by some officials, Brussels’ approval of a finalized strategic reserve proposal, requiring considerable work, could take as long as a year.

Brussels insists on PPC sale of lignite power packages to rivals

Power utility PPC must soon start offering rival suppliers portions of its lignite-based electricity production, as specified in an antitrust agreement, despite subdued interest by possible buyers expressed in a February market test, the European Commission insists.

The subject, which has remained stagnant for months following slow development over the past 13 years or so – ever since legal action was taken against PPC in 2008 over its lignite monopoly – will be one of the topics to be discussed at a meeting today between energy minister Kostas Skrekas and the European Commission’s Vice-President Margrethe Vestager, also Brussel’s Commissioner for Competition.

Given Brussels’ insistence, the energy ministry has devoted considerable time over the past few weeks to shape a lignite electricity sale plan, based on a January agreement between the minister and the country’s creditor institutions, that could finally settle the dispute.

The January agreement calls for the sale of energy packages, either quarterly or annually, representing, in 2021, 50 percent of the previous year’s lignite-based production.

The percentage of PPC’s lignite-based electricity quantities to be offered to rival suppliers in 2022 and 2023 should be reduced to 40 percent of the previous year’s output, according to the agreement.

These amounts are seen as insufficient to make any real impact on the retail electricity market’s standings.

Other issues to be discussed at today’s meeting between Skrekas and Vestager include Brussels’ support for a grid back-up model as part of a wider Capacity Remuneration Mechanism (CRM). Athens favors a separate Strategic Reserve Mechanism to remunerate units that are made available by electricity producers for grid back-up services.

Skrekas is also striving to establish a mechanism that would subsidize RES producers for power purchase agreements (PPAs) with energy-intensive industrial enterprises.

Energy storage subsidy program in 1Q next year

A competitive procedure to offer 200 million euros in subsidies for energy storage projects is planned to take place in the first quarter of 2022, energy minister Kostas Skrekas has told the 6th Delphi Economic Forum, making clear the ministry’s determination to utilize as swiftly as possible funds being made available for energy storage through the national recovery plan, dubbed Greece 2.0.

In the lead-up, the energy ministry intends to invite investors interested in participating in the procedure to submit investment plans in autumn.

The procedure will be based on a related framework, describing the conditions and terms, to require the European Commission’s approval.

The subsidy program will financially support energy storage installations to offer capacity totaling hundreds of MW, the minister told the forum.

The Greece 2.0 national recovery plan, to carry funds expected to be worth a total of 450 million euros, will also be used to support the development of pumped storage stations.

Investors have expressed tremendous interest in the development of energy storage units. RAE, the Regulatory Authority for Energy, has received a large number of production license applications for various RES technology units.

Since 2019, RAE has received a total of 98 applications for energy storage units, pumped storage facilities and hybrid stations, representing a total of 8,213 MW, which, along with a prospective pumped storage station set for development by Terna Energy in Amfilohia, northwestern Greece, will reach 8,893 MW.

To date, RAE has granted licenses for the majority of these applications, while 34, representing 4,519 MW, still need to be processed.

 

Legislative revisions to unblock DEPA Infrastructure sale

The energy ministry is planning to soon submit to Parliament legislative revisions designed to resolve pending issues that have held back the final stage of a privatization concerning gas company DEPA Infrastructure, sources have informed. The ministry will aim for the submission of binding offers by July.

Issues that have held back the sale, offering suitors 100 percent of DEPA Infrastructure, include a pending unification of the asset base of DEPA Infrastructure’s trio of EDA gas distribution subsidiaries and the establishment of a sale procedure for Eni Gas e Luce’s 49 percent stake in EDA THESS.

DEPA Infrastructure, EDA THESS’s parent company, holds a 51 percent stake in the gas distributor covering the Thessaloniki and Thessaly areas, while Italy’s Eni gas e Luce, maintaining the management rights with its 49 percent share in the gas distributor, wants to sell its stake.

Eni gas e Luce’s involvement in distribution has remained secondary to retail energy, the company’s primary focus, on an international scale.

The ministry’s anticipated legislative revisions promise to unify the asset bases of EDA Attiki, distributing to the wider Athens area, EDA THESS (Thessaly and Thessaloniki), as well as DEDA, covering the rest of Greece.

This asset base unification concerning the three distributors will lessen DEDA’s cost burden resulting from its network expansion projects as small distribution surcharge hikes by the two other EDA companies will hasten DEDA’s recovery of investment costs.

EP INVESTMENT ADVISORS; FIRST STATE INVESTMENTS (European Diversified Infrastructure Fund II); ITALGAS SpA; KKR (KKR Global Infrastructure Investors III L.P.); MACQUARIE (MEIF 6 DI HOLDINGS); and a consortium comprising SINO-CEE FUND & SHANGHAI DAZHONG PUBLIC UTILITIES (GROUP) Co., Ltd are the qualifiers through to the final round of the DEPA Infrastructure privatization.