TAIPED pushing ahead with DEPA sale, much work needed

TAIPED, the state privatization fund, is keen to push ahead with the privatization of gas utility DEPA, but the sale’s timely launch, expected in March, according to the latest bailout terms, will not only depend on the fund’s intentions.

In essence, this privatization’s punctual progress is dependent on Shell and DEPA, currently engaged in advanced talks for the Dutch firm’s sale of its 49 percent stake in retail gas supplier EPA Attiki. DEPA holds a 51 percent stake in this venture and wants to increase its hold.

The DEPA privatization, to offer 65 percent stake of the gas utility, cannot proceed unless the Shell and DEPA dealings over EPA Attiki have been finalized. Also, the European Directorate for Competition will need to endorse any EPA Attiki changes.

A well informed source has informed that Shell and DEPA are close to agreeing on a price for EPA Attiki’s 49 percent. The price gap is believed to have narrowed significantly. For quite some time now, it has been rumoured that Shell has requested a sum of around 150 million euros.

Rothschild, acting as DEPA’s consultant, and Lazard, representing Shell, are expected to appoint a common evaluator for an official price estimate. The evaluation process is expected to take at least one month to complete. Then, the two sides will still need to agree on a price before competition authorities in Athens and Brussels decide whether DEPA’s continued presence in the retail gas market raises any obstacles.

Given all these requirements, the DEPA privatization’s launch date, scheduled for March, should prove to be an extremely difficult target date.

The Greek government is eagerly anticipating a finalized deal between Shell and DEPA as a reinforced retail and distribution role for DEPA through EPA Attiki would undoubtedly heighten the interest of investors once the gas utility’s privatization is launched.

The government and country’s lenders appear to have reached a compromise deal on DEPA’s reinforced role in EPA Attiki in exchange for DEPA’s sale of its 51 percent stake in EPA Thessaloniki-Thessaly to Eni.

If so, DEPA will remain a powerful enterprise commanding three major fronts. Besides gaining a retail and distribution monopoly in the wider Athens market, the utility will also stand as a key gas importer and control gas distribution in all parts of Greece not covered by the EPA firms, through DEDA.

If the European Directorate for Competition does not endorse DEPA’s anticipated new role, then TAIPED, the privatization fund, will need to reexamine the utility’s privatization or postpone it.

The lenders are pressuring by excluding the possibility of any futher extensions.

TAIPED announced a tender yesterday for a legal consultant to work on the DEPA privatization. Interested parties face a February 26 deadline.

It remains unclear whether ELPE (Hellenic Petroleum) will offer its 35 percent stake of DEPA along with the Greek State’s 65 percent. ELPE has repeatedly expressed an interest in the natural gas market.

 

 

Fifteen local, foreign players interested in PPC lignite units

Greek and foreign electricity production firms, mixed teams, as well as local industrial energy consumers make up fifteen enterprises which, according to the energy ministry, have expressed an interest, through a recent market test, to acquire main power utility PPC lignite units in Megalopoli and Meliti, being offered in a bailout-required sale package.

Though the sale procedure has yet to reach a binding stage, certain players, responding to a market test question asking respondents if they intend to participate in the upcoming tender, provided positive answers, while noting  that their current interest remains conditional.

According to energypress sources, these firms include GEK-Terna, the Copelouzos Group, joined by China’s Shenhua for the PPC units sale, industrial energy consumers such as Viohalco, as well as electricity producers from eastern Europe, where lignite-fired electricity generation remains widespread.

Other players, including local industrial giant Mytilineos, have opted to keep their intentions under wraps for the time being.

The results produced by the market test, staged by the European Directorate for Competition to get a feel of investor intentions, will not necessarily be followed up later on in the sale, meaning that any interpretations of indications at this stage are premature.

Minimum sale prices to be set by an independent evaluator will be crucial. They will remain sealed and disclosed once first-round offers have been opened to determine qualifiers of the sale, scheduled to take place in June. PPC may request improved offers if these are below evaluation levels. Many market officials believe evaluation levels will be reasonable.

“If the evaluation levels are reasonable then many players may participate in the sale, including ones who did not express an interest in the market test. However, if these evaluation levels are deemed to be too high, then the number of participants could be restricted to a single-digit figure,” noted a highly-ranked official at one company.

This official added that certain negative market test responses could end up becoming positive as the sale procedure’s conditions are clarified over time. The content of a draft bill currently being prepared by the energy ministry will also be crucial factor, the official noted.

PPC’s commitment to share unit withdrawal costs with investors, once the time comes, is seen as a positive factor by prospective investors.

The European Commission will maintain full control of the sale procedure through a monitoring trustee, according to Greek daily Kathimerini.

 

 

 

 

DG Comp updates on PPC staff, mine licenses, facility sharing

Issues concerning main power utilty PPC lignite unit personnel, mining licenses, the inclusion of  the Vevi mine to the utility’s bailout-required sale package, as well as the ability of PPC and prospective buyers to share facilities associated with units being placed for sale dominated teleconference talks yesterday between energy ministry officials and the European Directorate for Competition.

The session was essentially held so that DG Comp officials could further update the energy ministry on comments provided by prospective investors during December’s market test. It was staged by the Brussels authority to enable investor feedback ahead of the PPC lignite units sale. A brief update had been delivered to the Greek ministry last week.

No surprise developments, or, more specifically, any demands concerning the inclusion of PPC hydropower faclities to the sale package, emerged during yesterday’s session, energypress sources informed. However, in their market test responses, certain participants did note that the package would represent a more enticing prospect if it were more balanced.

In their market test responses, participants are believed to have expressed concerns over mine licenses. Some licences are due to expire between 2019 and 2022. PPC faces lignite supply issues at its Meliti power plant in the Florina area, northern Greece, because neighboring mines, including Vevi, remain closed.

Energy ministry officials assured the DG Comp that PPC would take all needed action to settle mine license issues. The Vevi mine will also be included in the sale package, the energy ministry officials assured.

Teleconference participants agreed that prospective buyers and PPC will be able to share facilities supporting the Megalopoli III and IV power plants included in the package. These include a waste treatment plant serving these two units as well as Megalopoli V, a natural gas-fueled power plant not included in the sale package. Contracts are expected to be signed setting prices for the access to facilities to be provided by PPC.

The DG Comp officials also raised questions over the 1,100 employees currently stationed at Megalopoli III and IV, associated lignite mines, as well as Megalopoli V. A proportion of the personnel at these facilities, some of which are believed to be overstaffed, could be transferred by PPC to other units. The DG Comp wants to ensure qualified personnel remains at the Megalopoli units up for sale. The Brussels authority also called for no more personnel additions to these units.

All these issues will be incorporated into a PPC draft bill being prepared by the energy ministry. Greek officials will need to deliver a final commitment to the DG Comp before the PPC bill is ratified in Greek parliament, expected next month. The launch of the sale’s tender is being planned for early summer.

The PPC lignite units sale has been divided into two packages, a northern package including Meliti I and a license for Meliti II, as well as a southern package including Megalopoli III and IV. The PPC draft bill will offer a description of the sale procedure, permitted buying combinations, a date for the tender, probably in June, and plans concerning employment, facility and license issues.

 

 

PPC market test concerns to be worked into unit sale draft bill

The concerns of investors considering taking part in the main power utility PPC’s bailout-required sale of lignite units are focused on two issues, one being the utility’s Megalopoli III and IV units, especially staff numbers, believed to be excessive, and the other, pending license issues linked to mines intended to supply Meliti I and, later on, Meliti II, once this latter facility is developed.

These concerns were highlighted by the results of a market test conducted by the European Directorate for Competition and delivered to Greece’s energy ministry late last week.

The DG Comp comments do not go into great detail but represent a basis for further discussion, according to energypress sources. A teleconference to involve energy ministry and DG Comp officials is being planned for this week, the sources informed.

Prospective investors are believed to have also expressed concern over the future of lignite, noting PPC’s sale package would be more atttactive if hydropower plants were included.

As for the overstaffing issue at PPC’s Megalopoli III and IV units, the market test participants are seeking details on the legislation to be drafted for 1,100 staff members currently employed at the power station.

Prospective investors also enquired about the current state of PPC’s transmission network.

Following this week’s teleconference between energy ministry and DG Comp officials, the Greek government will need to incorporate any required revisions into a draft bill concerning the PPC lignite units sell-off.

Then, Greek authorities will need to deliver a final commitment to the DG Comp before ratifying the bill in parliament. This is expected to take place next month ahead of an announcement of a tender early next summer.

Greek authorities have already begun working on the PPC sale’s draft bill, whose articles offer a description of PPC lignite assets to be placed for sale as well as details on the sale procedure.

Two sale packages, a northern and southern package, will be offered to investors. The northern package will include Meliti I and the Meliti II license. The southern package will include Megalopoli III and IV.

The draft bill’s article on labor issues is expected to include previous conditions set for an older but unexecuted 17 percent sale plan for PPC, locally dubbed “Little PPC”. These terms included conditions requiring buyers to maintain a large majority of jobs at any units sold for at least five years.

Brussels raises concerns over competition in local energy market

Despite the bailout progress made in nearing the third review’s finalization, the European Commission has identified a series of problems and delays concerning competition in Greece’s energy market, according to energypress sources.

An existing natural gas supply agreement between PPC, the main power utility, and DEPA, the public gas corporation, is one of the issues troubling Brussels authorities as it is believed to contain favorable terms benefiting the power utility. This agreement, for instance, does not include any terms leading to additional costs for PPC should its gas consumption exceed contracted amounts.

As for the electricity supply market, European Commission officials believe a supplier surcharge imposed on suppliers by the Greek government has absorbed 70 percent of discounts gained by independent suppliers at auctions.

Brussels officials have also noted that discounts made available to electricity suppliers through NOME auctions cannot be capitalized on the islands, where markets are affected by additional obstacles and existing tariffs do not offer profit margins.

A delay of about year in establishing a new flexibility remuneration mechanism in Greece is another matter preoccupying Brussels officials. This delay has led to benefits for PPC estimated to be worth between 120 million and 170 million euros.

A 15 percent discount offered by PPC to customers paying their electricity bills on time has also drawn the attention of Brussels officials as this intiative has forced independent suppliers to take similar action in an effort to remain competitive despite not having the leeway to do so. Market newcomers face elevated network development costs and other investment expenses not burdening PPC, the perennially dominant power utility.

In the Greek electricity production market, Brussels officials have concluded lignite-fired power stations remain active even amid loss-incurring conditions with the aim of preventing independent plants from operating.

Questions have also been raised as to whether PPC is benefiting from IPTO (power grid operator) decisions concerning the level of RES production permitted into the country’s energy system.

On a more general scale, Brussels also fears energy sector reforms currently being implemented may not be completed by August, when the country’s bailout agreement concludes. As a result, a new mechanism ensuring the continued implementation of these reforms could be needed once the bailout agreement has concluded.

A team of European Directorate for Competition officials had raided the PPC and IPTO a year about a  year ago as part of their investigation.

 

Energy ministry preparing draft bill for PPC units sell-off

Energy ministry officials are currently busy preparing a draft bill for the bailout-required sale of main power utility PPC lignite units with the aim of submitting the document to parliament within February for ratification.

The sale process has just undergone a market test, staged by the European Commission’s Directorate-General for Competition to measure the level of investor interest and enable interested parties to settle queries. Interested parties were issued a related questionnaire.

Brussels is expected to provide market test feedback to the energy ministry within the current week, possibly today. The market test officially ended on December 22 but certain interested parties were given slight extensions after requesting additional time. The festive season also slowed down the process. Most interested parties are believed to have focused their concerns on the Greek electricity market’s long-term conditions covering at least the next 15 years.

Besides offering a rundown of the power utility’s lignite units up for sale – representing 40 percent of PPC’s lignite capacity – the ministry’s draft bill will also specify the sell-off procedure, the publication date of the international tender, expected in May, the timing of its launch, scheduled for June, as well as labor issues concerning overstaffed units included in the sale package.

The sale will offer two packages, one including PPC lignite assets in Greece’s north (Meliti I and a licence for the prospective Meliti II), and the other, units in the south (Megalopoli III and IV).

Though the ministry has yet to clarify the details to go into the draft bill’s section on labor rights, conditions that had been set for a previous unexecuted partial sale of PPC, locally dubbed “Little PPC”, are expected to apply for the new effort.

The older sale conditions committed the buyer, or buyers, to maintain the majority of jobs at units sold for a period of at least five years. All other employees would have been absorbed by PPC at other operations, according to the “Little PPC” sale plan’s labor conditions. Megalopoli employs 1,100 persons and Meliti a further 200.

Following the draft bill’s submission to Greek parliament in February, the planned legislation will need to be endorsed by the European Commission’s Directorate-General for Competition in March.

 

PPC market test respondents want clarity for at least 15 years

Local and foreign investors taking part in a market test staged by the European Commission’s Directorate-General for Competition for the main power utility PPC’s bailout-required sell-off of lignite units are demanding clarity in Greece’s electricity market conditions for a period covering at least 15 years if they are to submit binding offers to the sale, according to energypress sources.

“We made clear to the DG Comp that what matters most is not the individual character of each unit but the very functioning of the Greek market, which remains problematic,” a highly-ranked official at one Greek energy firm told energypress. “The ambiguity regarding the conditions to be encountered by investors who could possibly seek acquiring lignite assets will need to be clarified for a period covering at least the next 15 years,” the official added.

A number of factors continue to trouble prospective investors. The main concerns expressed by respondents in the ongoing market test include lignite’s level of participation in Greece’s energy mix in the years to come; whether lignite units will be entitled to CATs via the permanent flexibility remuneration mechanism; the future course of CO2 emission right costs; the timing of the target model’s implementation; the future of the Vevi mine, currently closed, as well as the futures of other mines in northern Greece’s Florina area.

The majority of comments were provided by Greek, east European and Asian firms, the energypress sources noted.

Concern was also expressed over the impact on the electricity market of a lifespan extension plan being prepared by PPC for its Amynteo lignite-fired power station through an environmental upgrade. The DG Comp rejected the unit’s inclusion on the sale list as a result of its limited lifespan.

Market test respondents were asked whether they believe investing in the sale procedure’s packages – one grouping units in Greece’s north (Meliti I, licence for Meliti II) and, the other, units in the south (Megalopoli III and IV) – promise sustainability, both in the short and long terms.

Responses to this question were both favorable and negative. Critics primarily cited future CO2 emission right costs as a concern. Others expressed concern as a result of a drastic reduction being planned for the role of lignite in Greece’s energy mix. PPC believes lignite’s energy mix presence should be maintained at the current level of around 25 to 27 percent.

Certain respondents noted that Megalopoli units barely offer worthwhile investment prospects as regional lignite deposits feeding these facilities are limited. The deposit supplying Megalopoli III is due to run out in 2025, while the deposit supporting Megalopoli IV should be depleted by 2032.

 

Various PPC unit sell-off issues holding back local players

As the market test held for the main power utility PPC’s bailout-required sell-off of lignite units, representing 40 percent of ts lignite capacity, gradually approaches completion, the reactions of major Greek energy groups should be interpreted as firm positions.

The market test, supervised by the European Commission’s Directorate-General for Competition, is intended to measure the level of investor interest and clarify queries.

Two major local players indicated they are considering taking part in the sale but are remaining cautious as a result of concerns.

A source at an independent electricity producer expressed concerns over mines and licenses of units included in the sale package, noting that, in the country’s north, three mines linked to the Meliti 1 power station and a construction permit for Meliti II, these being Vevi, Klidi and Lofi, are currently closed.

As for the Megalopoli III and IV units in the Peloponnese, prospective investors have expressed concerns over license issues at associated facilities.

Production capacities, existing payrolls and financial data concerning units included in the sale are also being closely examined by prospective investors.

Some market sources noted that investors are being called upon to make crucial entrepreneurial decisions despite a lack of clarity on the Greek electricity market’s future look.

 

DG Comp: Market test to shape next steps of PPC units sell-off

A market test launched just days ago by the European Commission’s Directorate-General for Competition for main power utility PPC’s bailout-required lignite units sell-off may represent the beginning of further developments, a DG Comp official has indicated in comments to energypress.

“We’ve begun with the market test, based on the proposals made, and will wait for its results before we decide on any further steps,” the DG Comp official told energypress.

The market test, now underway as a procedure intended to measure the level of investor interest and also provide interested parties with an opportunity to make enquiries, cannot be guaranteed to produce the results desired by PPC and the Greek government, which negotiated the content of the current sale package with the country’s lenders, the DG Comp official suggested.

Without a doubt, the DG Comp’s next steps will be determined by the outcome of the market test. The sale effort will go ahead only if the market test convinces Brussels that the existing sale package of state-controlled PPC lignite-fired power stations, lignite mines, and a construction permit for a new power station (Meliti II) can deliver the required results.

If not, the DG Comp maintains the right to intervene for sale package revisions as it sees fit.

The DG Comp source told energypress that a European Court rejection of a PPC appeal in 2016 means that European Commission decisions made in 2008 and 2009 regarding the utility’s market dominance must now be implemented.

PPC and Greek government officials are confident the market test will deliver positive results and enable the disinvestment process to proceed as planned. PPC and energy ministry officials have already approached prospective investors and claim that many of these, both local and foreign, have responded favorably. It will soon become apparent whether these upbeat Greek expectations are justified.

Given the future prospects of lignite, facing rising CO2 emission right costs in Europe, PPC will probably be glad to unload part of its lignite portfolio for a satisfactory price. This could improve the utility’s financial standing and help fund initiatives in other energy domains.

 

DG Comp launches market test for PPC lignite units package

The European Commission’s Directorate-General for Competition yesterday launched a market test for the main power utility PPC’s bailout-required sale of lignite units, inviting many companies from Greece and beyond to participate in this consultation process, intended to measure the level of interest and offer prospective investors the opportunity to raise and resolve queries.

The aim of the PPC disinvestment plan is to eliminate electricity market disortions caused by PPC’s perennial dominance and boost competition. Yesterday’s market test launch came a few days later than had been expected.

The market test process will run until the end of January. Additional bailout terms obligate the Greek government to revise the sale package should the market test’s results prove to be unsatisfactory.

At least 40 electricity and energy firms hailing from Greece, Poland, the Czech Republic, Japan, China, India and the USA will be invited to take part in the market test.

PPC’s Meliti I, Megalopoli III and IV, a construction permit for Meliti II, as well as lignite mines associated with these lignite-fired facilities have been included on the sale list.

These units will be offered as two separate packages, one covering the country’s north (Meliti 1 and II, as well as the Vevi and Klidi mines), and the other covering the south (Megalopoli III and IV, and two lignite mines in the area).

An international tender for the sale package is scheduled to be announced next May.

The response by local industrialists has so far been varied. Elpedison has made clear it will not participate under the current conditions. Terna and Mytilineos have adopted a wait-and-see approach, while others, including the Copelouzos group, have already declared an interest to participate.

PPC boss Manolis Panagiotakis recently called upon the industrial sector to participate in environmental upgrades of lignite-fired power stations not include in the sale package in exchange for favorably priced electricity supply deals. Talks are already believed to be underway with electricity producers and energy-intensive industrial units.

Emergency check in Feb may spark hydropower unit sales

The electricity market will be subject to a comprehensive emergency assessment in February, which could prompt the need for further “structural measures”, or, more specifically, a plan for the sale of additional state-controlled main power utility PPC units, according to a term included in the bailout agreement following its third review.

This emergency assessment, to be conducted as an extra measure in addition to inspections already agreed to for every six months, will examine whether NOME auction terms require revisions, the progress made with the target model – a process entailing the electricity wholesale market’s harmonization with EU law – as well as other matters.

In previous bailout-related matters, the term “structural measures” was applied as a soft, indirect reference to the possibility of PPC lignite units, a procedure now underway, and is being used again to imply the sale of PPC hydropower units, widely seen as a taboo subject by Greek government and PPC officials.

The Greek government firmly opposes any talk of prospective PPC hydropower unit sales.

However, PPC has fallen way behind in its bailout-required retail electricity market share contraction targets. The utility’s market share currently stands at around 84 percent, well above the 75.24 percent target level set for the end of 2017. In the longer term, PPC needs to reduce its market share to less than 50 percent by 2020.

These figures indicate the NOME auctions may have offered some support to keep independent electricity suppliers afloat but have failed to produce the required market share contraction results at PPC. The situation is expected to spark talks for more structural measures.

Electricity amounts offered through the NOME auctions, introduced slightly over a year ago to provide independent suppliers with access to PPC’s low-cost lignite and hydropower sources, are expected to be reduced as PPC’s lignite unit sale plan progresses. A market test is scheduled to take place in January ahead of the sale’s launch early in the summer.

On another crucial front, the European Commission’s Directorate-General for Competition’s is currently investigating whether PPC has abused its dominant market position. DG Comp officials raided the headquarters of PPC and IPTO, the power grid operator, a few months ago. A decision against PPC would entangle hydropower facilities, being monopolized by the utility.

 

Flexibility mechanism delayed by insufficient market reforms

The delivery of the country’s new flexibility remuneration mechanism plan by local authorities to the European Commission has been postponed until March, meaning its implementation, intended to compensate electricity producers for flexibility-related output, will be delayed accordingly, energypress sources have informed.

This rescheduling, included as a term in the bailout’s just completed third review, has been attributed to the lack of progress in local electricty market reforms.

Market reforms are expected as prior actions by the European Commission’s Directorate-General for Competition and Directorate-General for Energy before any remuneration mechanism may be applied to cover additional needs.

Officials in Brussels have obviously identified delays concerning electricity market reforms and, as a result, opted to delay the new flexibility remuneration mechanism’s introduction.

This delay will place even greater sustainability pressure on the country’s gas-fired electricity producers, left without CAT payments since April, and also pose a threat for the country’s energy supply security, especially amid the forthcoming winter period.

RAE, the Regulatory Authority for Energy, recently staged a public consultation process to shape the new flexibility mechanism’s details. It will be based on an annual auction procedure, as required by European law.

The plan entails offering producers three-hour-notice flexibility compensation for a maximum of 4,263 MW through one auction in 2018, not two as was initially considered.

Also, the starting remuneration price at flexibility mechanism auctions will be set at 30,000 euros per MW of output, slightly higher than the originally planned level of 25,000 euros per MW.

Hydropower and natural gas-fired electricity producers as well as Combined Heat and Power High Performance (CHP) stations will be entitled to take part in flexibility mechanism auctions. CHP units will have the right to seek payment for any output not remunerated through existing RES payment mechanisms.

Also, gas-fired electricity producing units will need to be able to run on alternative fuel (diesel) or possess natural gas reserves to be eligible for the flexibility mechanism’s auctions. This essentially means producers will need to hold additional supply contracts or be able to cover the cost of temporary LNG storage solutions, either directly or indirectly, as was proposed by DEPA, the public gas corporation.

PPC unit sales market test in December, package ready

With virtually all the details of Greece’s bailout-required sale of main power utility PPC units now ready, the market test to measure the level of investor interest in the package will take place in December, energy ministry officials have informed.

Government officials and European Commission Directorate-General for Competition authorities yesterday reached an agreement in Brussels on the sale list’s content, to include Meliti I, a construction permit for Meliti II, Megalopoli III and IV.

The energy ministry team will now finalize related legal texts over the weekend and present them to the country’s lenders on Tuesday.

Though Greek demands calling for lifespan extensions of PPC’s ageing Amynteo and Kardia units, as well as a reduction of electricity amounts offered to independent suppliers through the NOME auctions remain pending, these are not expected to block the agreement.

According to sources, the energy ministry’s secretary general Mihalis Veriopoulos, who is heading the Greek delegation in Brussels, has received positive feedback on the request for lifespan extensions of the ageing PPC units. The lenders’ view on the NOME cutback demand remains unclear.

The bailout-required sale’s outcome will depend on the level of offers to be made, as was highlighted by PPC boss Manolis Panagiotakis at an IENE (Institute of Energy for Southeast Europe) conference held yesterday.

A consultant will need to soon be hired to evaluate the units to be placed for sale. This will be tricky given the uncertainty of CO2 emission right costs in the future. Megalopoli IV, for example, has 14 years of operating time remaining. The evaluation will need to somehow factor in prospective CO2 emisson right costs.

The EU’s climate change policy has made investing in solid fuels unsustainable. PPC’s lignite unit production costs currently stand at levels of between 50 and 60 euros per MWh while, by 2030, this cost is expected to skyrocket to nearly 100 euros per MWh, as a result of higher CO2 emisson right costs anticipated.

In other words, investing in lignite units at present makes no sense, unless these can be purchased at low prices. It remains unknown as to whether the PPC board and shreholders, as well as the banks linked to the power utilty, will be prepared to let go of lignite units at low prices.

Crucial talks in Brussels for PPC lignite unit sale package

A four-member team of highly ranked Greek energy ministry officials is scheduled to be in Brussels tomorrow and Thursday for a crucial second round of negotiations with European Commission Directorate-General for Competition authorities on technical issues concerning the main power utility PPC’s bailout required sale package of lignite units.

The sale agreement is expected to be completed by the end of November or early December, as was pointed out by energy minister Giorgos Stathakis last week, before a market test is held to measure the level of investor interest.

Details of the PPC sale are expected to take shape during the negotiations in Brussels over the next couple of days. The establishment of an agreement concerning the sale of a PPC sale package representing 40 percent of the utility’s lignite capacity has been included as a prior action for the conclusion of the bailout’s third review.

The Greek delegation – to be comprised of the energy ministry’s secretary general Mihalis Veriopoulos, Mihalis Nikolakakis, director of energy minister Giorgos Stathakis’s office, legal consultant Vaia Karathodorou, and ministry adviser K. Stratis – had traveled to Brussels for a first round of technical talks with the DG Comp in September, just days ahead of the arrival in Athens of the lender representatives for bailout agreement review talks.

The two sides have essentially already agreed on the inclusion, to the PPC lignite units sale list, of Meliti; a construction permit for Meliti II; Megalopoli III and IV; as well as the lignite mines at Vevi, Ahlada and, possibly, Klidi. Details concerning the futures of personnel employed at these units and the split process of the units from the utility still need to be worked out.

Details also need to be finalized on the acceptance by the DG Comp of a Greek proposal enabling PPC to keep operating its ageing Amynteo and Kardia units. According to the plan, both units will be upgraded in collaboration with a private-sector investor.

It is still unclear whether the inclusion of Amynteo into the portfolio of units to be kept by PPC will influence the sale package representing 40 percent of PPC’s lignite capacity.

Package deal sought for PPC unit sales, client shifts, NOME

The Greek government appears to be seeking a package deal with the country’s lenders that, besides the sale of main power utility PPC lignite units, will also include the sale of PPC portions with utility customers on board to rival suppliers – based on an older PPC proposal – reassessment of the NOME auctions, and, finally, life extensions of older utility units rejected from the unit sale list.

A finalized Greek proposal is expected to be forwarded to the lenders on Thursday or Friday. If accepted, a team of energy ministry officials will travel to Brussels at the end of the week or early next week to sign a finalized agreement. A market test measuring the unit sale list’s level of investor interest will need to be staged within the last ten days of November.

According to sources, the PPC sale list will include Meliti I (330 MW), a licence to develop Meliti II (450 MW), and two Megalopoli units (600 MW).

The package will also include a request for lifespan extensions of two ageing PPC units, Kardia (1,200 MW) and Amynteo (600 MW).

Amynteo has been was rejected by the DG Comp from the PPC sale list. The Brussels authority has advised the Greek government to utilize this facility as its sees fit.

The Greek proposal for the split and sale of PPC portions with existing customers on board is intended to accelerate PPC’s market share contraction in the retail electricity market. This Greek request shares similar traits to the “Little PPC” plan brought forth in 2014 but not executed. However, the latest proposal will not include hydropower and natural gas-fired facilities.

Greek officials also want the NOME auction terms to be reassessed should PPC units be sold. This term has been included in the revised bailout. The NOME auctions were introduced in Greece just over a year ago to offer independent suppliers access to PPC’s low-cost lignite and hydropower sources. An objective was set for PPC’s market share to contract to less than 49 percent by the end of 2019.

Finalized PPC sale list next week, energy minister promises

The content of main power utility PPC’s bailout-required sale package of lignite units, expected to represent 40 percent of the utility’s lignite capacity, will be finalized next week, Greek energy minister Giorgos Stathakis noted last night at the 2nd EU-Arab World Summit in Athens.

The Greek government faces no other choice but to have agreed on a finalized PPC sale list by next week if a market test measuring investor interest is to be staged within the current month, as is scheduled.

Meanwhile, taking it a step further, other government sources contend the sale list’s content has already been finalized, adding that an announcement for the market test’s starting date is all that remains.

Sources told energypress that the PPC sale package will include the Meliti unit, a construction permit for development of a second Meliti unit, as well as Megalopoli III and IV.

In comments yesterday, Maros Sefcovic, the European Commission’s vice president for Energy Union, expressed confidence that an agreement between the Greek government and the European Commission’s Directorate-General for Competition on the PPC sale list is near. Constructive talks are in progress, Sefcovic noted.

 

PPC lignite sale list near, Megalopoli III, IV included

The Greek government and state-controlled main power utility PPC are extremely close to reaching an agreement with the country’s lenders on the content of the utility’s bailout-required sale package of lignite units, sources have informed.

A finalized list needs to be established so that a market test, to measure investor interest, is officially launched.

At this stage, it appears the finalized list could be established on Thursday during a teleconference to be held between Greek officials and lender representatives, its purpose being to resolve pending issues.

PPC’s two ageing Amynteo lignite-fired power stations appear to be out of the picture. Taking this into consideration, the European Commission’s Directorate-General for Competition believes Megalopoli III and IV need to be included in the PPC sale package. PPC has strongly reacted against the prospect of selling Megalopoli IV, one of the corporation’s most modern and newest units. However, the utility appears willing to let go of Megalopoli III, whose lifespan is shorter.

PPC’s reactions are believed to be the main reason why the negotiating sides have yet to deliver a finalized sale list.

Despite the utility’s objections to the inclusion of Megalopoli IV on the sale list, the government, judging by the latest developments, appears willing to accept the inclusion of both Megalopoli units.

Finalization of the PPC sale list stands as a key energy sector issue that needs to be resolved if the bailout’s third review is to be concluded.

 

 

PPC’s Megalopoli facility reentering sale package talks

The energy ministry is preparing to forward a revised proposal to the European Commission’s Directorate-General for Competition concerning the bailout-required sale of main power utility PPC unit sales.

The content of the new proposal, whose preparation was prompted by the DG Comp’s recent, and latest, rejection of an intention by Greek officials to include PPC’s ageing Amynteo lignite-fired on the sale list, remains unknown.

The Amynteo facility, in Greece’s north, needs a major revamp if its lifespan is to be prolonged.

It is now widely believed state-controlled PPC’s more modern Megalopoli facility in the Peloponnese will enter the unit sale package talks, as has been desired by the DG Comp.

Though the energy ministry has remained cagey about the content of its new proposal, it has made clear the Agios Dimitrios facility, close to Kozani, northern Greece, remains out of the picture.

A market test, to measure the level of investor interest in PPC’s sale package, once it is finalized, is expected next month.

A DG Comp letter received by Greece’s energy ministry just days ago appears to have rejected a Greek argument claiming PPC would be comparatively disadvantaged – in terms of unit lifespans – if the more modern Megalopoli facility is sold to investors and PPC is left with ageing facilities.

 

DG Comp reiterates outright rejection of Amynteo for PPC sale list

The European Commission’s Directorate-General for Competition has once again rejected an intention by Greek officials to include the main power utility PPC’s ageing Amynteo lignite-fired facility in a bailout-required sale package of utility lignite units, energypress sources have informed.

The DG Comp reiterated its position in a letter received by the energy ministry on Wednesday, the sources said.

Technocrats representing the country’s lenders for preliminary negotiations ahead of next Monday’s arrival in Athens of the lender representatives – for about a week of work on the Greek bailout’s third review, including energy sector issues – warned Greek officials that time for the PPC sale package is running out.

The technocrats are pushing for a solution that would satisfy the DG Comp. The authority supports the sale-list inclusion of state-controlled PPC’s more modern Megalopoli unit in the Peloponnese rather than Amynteo, located in the country’s north.

The gap between the DG Comp and Greek team of officials does not appear to be bridgeable at present. Recent local reports suggested the DG Comp could be willing to accept the inclusion, on the PPC sale package, of Amynteo, a facility needing a major revamp if its lifespan is to be extended. However, the latest letter forwarded by the authority to the energy ministry fully rejects such a prospect.

In its letter, the DG Comp rejects a Greek argument claiming PPC would be comparatively disadvantaged – in terms of unit lifespans – if the more modern Megalopoli facility is sold to investors and PPC is left with ageing facilities, the energypress sources informed.

Japan’s Hitachi widens Asian interest in PPC unit sale plan

Though European interest in the main power utility PPC’s bailout-required unit sale package, until now a lignite-only offer, has remained limited to investors from the continent’s east, Asian interest is broadening, as suggested by Japanese consideration following Chinese.

Japan’s Hitachi corporate group, which has taken on constructing the utility’s Ptolemaida IV, a project budgeted at 1.4 billion euros, is also eyeing the PPC units sale, sources have informed.

It is believed the Japanese company’s buying interest is combined with an interest to upgrade ageing PPC units and construct new ones, key activities at Hitachi Power Europe. Interestingly, Japanese investors are extremely selective in their investment choices, as is highlighted by the country’s limited Greek market presence.

Meanwhile, Greek officials, including government and PPC authorities, are continuing their negotiations with the European Commission’s Directorate-General for Competition over the units to be included in the utility’s sale package.

Certain sources are claiming that Brussels authorities have eased up on previous objections concerning the inclusion of a Meliti unit license into the sale package. DG Comp authorities have questioned whether the sale of a permit to build represents a disinvestment move. This Meliti license is now seen as an asset by DG Comp officials, sources noted.

It remains to be seen whether PPC’s Amynteo or Megalopoli lignite-fired facilities will be included in the package. Greek officials believe the Amynteo unit proposal fully satisfies the procedure’s requirements, rendering any talk of Megalopoli’s inclusion into the sale package as unnecessary. Even so, Greek officials are fully aware of the fact that Brussels, not yet convinced of the local PPC unit sale proposal, has kept Megalopoli on the negotiating table.

Brussels sees the inclusion of the Amynteo facility as a costly option as this unit is ageing and requires an 80 million-euro revamp. Of course, if performed, the facility’s lifespan would be extended to 2035.

 

 

 

 

DG Comp calls for PPC sale package revisions, additions

Directorate-General for Competition authorities, at a meeting in Brussels with a team of Greek officials yesterday, called for substantial revisions to a Greek bailout-required sale package of main power utility PPC lignite units, doubting the offer’s potential to pass next month’s market test, held to check the level of investor interest. The DG Comp officials also questioned whether the Greek package covers 40 percent of the PPC’s lignite capacity, as is demanded in the revised bailout.

This boils down to meaning that additions will most likely need to be made to the PPC sale package proposal, which currently includes two ageing units an Amynteo, the modern Meliti I facility in the Florina area, northern Greece, and a construction permit for Meliti II.

According to certain sources, the DG Comp officials asked for the Meliti II license to be replaced by an existing unit, such as Megalopoli.

Yesterday’s session was primarily held to confirm and make note of differences  dividing the two sides. Talks are expected to continue over the next few days. The DG Comp officials are expected to keep pressing the Greek team, fighting to keep hydropower units off the PPC sale list.

At this stage, it appears that the Greek government will need to either include two existing Megalopoli lignite-fired units, offering a combined capacity of 511 MW and a lifespan – without any revamps – until 2025, or, as a more dreaded option, the Agios Dimitrios power station, comprised of five units whose capacity totals 1,456 MW.

Yesterday’s meeting highlighted that plenty of work still lies ahead before a finalized agreement on the PPC sale package is established. As a result, the market test, scheduled for October, could be delayed.

 

 

 

 

DG Comp doubts PPC’s lignite-only market test prospects

Greek officials, taking part in a Directorate-General for Competition meeting today, will seek to convince Brussels authorities that the government’s proposed sale package of main power utility PPC lignite units stands a chance of passing next month’s market test.

The exchange of views leading to today’s meeting has strongly suggested that the DG Comp is discontent with the Greek plan. Brussels officials appear to believe that Greece’s electricity market cannot achieve full liberalization unless hydropower units are also added to PPC’s sale package.

The Greek government, which will be represented by a mixed team of energy ministry and PPC officials, headed by the ministry’s secretary general Mihalis Veriopoulos, at today’s Brussels meeting, is expected to face major pressure in its defence of its proposal.

Issues the Greek team will need to explain include a government decision to include two old Amynteo units in its PPC sale package – when it has already been determined that these require extensive revamps that would cost prospective buyers over 50 million euros – instead of the utility’s Agios Dimitrios and Megalopoli units.

The Greek government has, so far, contended that it cannot see why prospective buyers should not invest to upgrade units when state-controlled PPC needs to do likewise. Athens has raised the Agios Dimitrios facility as an example. PPC has already spent 70 million euros of a total of 100 million euros needed for its environmental upgrade.

As for a Brussels concern over the inclusion of Meliti I and a license for prospective Meliti II, rather than an entire existing facility, in the sale package, the Greek government supports that investors would be buying PPC’s most modern unit, a permit to construct an additional adjacent unit, plus a lignite deposit at Vevi to feed this facility. The Greek government has also adopted this same argument to defend its inclusion in the sale package of the ageing Amynteo units, which are sided by the Amynteo and Lakkia mines.

Though these arguments are not groundless, DG Comp officials are skeptical of the current sale package’s ability to attract satisfactory investor interest. Investors have yet to express noteworthy interest. Even so, Greek officials will stick to their guns and present the interest purportedly expressed by investors from east Europe and China.

Greek officials will seek to avoid a bargaining procedure entailing demands for additions and exclusions of units. This is a dreaded thought for Athens as it could bring PPC’s hydropower units into the picture.

“Most importantly, we need to convince [Brussels officials] that investor interest will be expressed [for the market test],” a Greek official participating in today’s talks told energypress. “We’ll then find solutions for the rest along the way.”

 

 

DG Comp wants PPC’s 40% lignite reduction prior to 2020

The European Commission’s Directorate-General for Competition wants the main power utility PPC to reduce its lignite-sector capacity by 40 percent sooner than 2020, sources have informed, adding that a Greek proposal delivered to Brussels has set a target beyond 2020-2021 for this reduction.

The DG Comp concerns over the PPC sale package proposal are currently focused on what Brussels views as the need for the utility to reduce its presence in the lignite sector at a faster rate.

PPC’s lignite-based capacity is expected to fluctuate over the next few years as a result of unit withdrawals and additions. The Kardia unit is scheduled to stop operating in 2019 while a new unit, Ptolemaida V is planned to start operating in 2022.

The gap separating Athens and Brussels on the pace at which PPC should reduce its lignite-sector presence could prompt changes in the make-up of the sale package.

Officials in Brussels are examining whether the Greek proposal concerning PPC’s sale package of lignite units meets bailout terms, according to the source, who did not elaborate.

The Greek plan is comprised of PPC’s two Amynteo units (600 MW), an existing Meliti unit (330 MW), a license for the construction of a new facility in Meliti (450 MW), as well as the Amynteo, Lakkia and Vevi mines feeding these units. This proposal represents 36 percent of PPC’s lignite-fired power stations and 42 percent of its lignite mines.

The inclusion, on the sale list, of the Amynteo units, scheduled to cease operating in 2020 and requiring an investment of around 100 million euros to keep running for a further 10 to 15 years, is another issue that may contravene the agreement’s terms, Brussels officials believe.

 

DG Comp spots hydropower unit manipulation practices at PPC

A formula determining when main power utility PPC’s hydropower units are brought into play for contributions to the grid has been tampered with to influence the System Marginal Price (SMP), the European Commission’s Directorate-General for Competition has found, according to Greek daily Kathimerini.

This finding is linked to a probe conducted by DG Comp officials at the headquarters of main power utility PPC and IPTO, the power grid operator, following invasions earlier this year to examine whether the utility is manipulating its wholesale electricity prices.

It is believed that PPC has been informed of the findings by the European Commission and expected to deliver explanations.

Officials in Brussels are now already writing up a decision, based on the DG Comp findings, which is expected to be finalized in autumn. This decision will coincide with the market test concerning the bailout-required list of PPC lignite-fired units to be offered for sale. Hydropower stations will also be added to the sale list if investor interest in the lignite-fired units is insufficient.

According to sources, the DG Comp will take action against PPC for its market manipulation practices, which could result in fines representing as much as 10 percent of the utility’s turnover.

PPC will not be able to shoulder such a burden, given its current strain, and, as a result, will be forced to add hydropower units to the sales list, sources have informed.

Following their ambush of the PPC and IPTO headquarters in February, DG Comp officials returned to PPC’s headquarters earlier this month.

 

 

Flexibility capacity cuts seen for temporary CAT mechanism

A flexibility study prepared by power grid operator IPTO and delivered to RAE, the Regulatory Authority for Energy, limits flexibility provisions to electricity production units that are capable of entering the system within three hours of notification by the operator, according to energypress sources.

More specifically, the annual flexibility needs have been calculated at 3,500 MW for 2017, 2018 and 2019, the first three years of a ten year-period examined in the study. This comes as a reduction compared to the temporary CAT mechanism that expired in April and was based on annual flexibility needs of 5,000 MW.

The significant reduction of flexibility capacity and provisions indicates that the amount of CATs to be offered as part of the new temporary flexibility mechanism to be proposed by RAE and implemented, assuming the European Commission offers its approval, until the target model is introduced, will be reduced.

Proceedings at auctions, required by related new European Commission regulations, will determine which units stand to benefit as well as the amounts to be received by units offering flexibility.

Given the new standards proposed by the IPTO study, it remains unknown whether main power utility PPC’s hydropower stations will be able to qualify into the category of units offering flexibility services.

RAE plans to soon announce the new temporary CAT mechanism and offer pre-notification of the permanent mechanism, which, according to the bailout, must be announced by the end of June. At this stage, it does not appear that the permanent mechanism’s announcement can be made any earlier than mid-July. The pre-notification of the permanent CAT mechanism and the announcement of the temporary system are expected to be jointly announced.

A vague picture also prevails for the demand response mechanism (interruptability), directly linked to the CAT mechanism. Though the energy minister Giorgos Stathakis and Prime Minister Alexis Tsipras have both promised Greece will submit a seperate application for a three-year extension to the current mechanism that expires in October, the European Commission’s DG Comp, according to sources, is seeking to have the demand response mechanism incorporated into the temporary CAT mechanism as it believes flexibility is not only restricted to electricity production units but can also include consumers.

Greek industrialists have made clear to Greek government officials that the demand response mechanism is essential if energy-intensive producers are to remain competitive.

The demand response mechanism (interruptability) enables major industrial enterprises to be compensated when the TSO (IPTO) asks them to shift their energy usage (lower or stop consumption) during high-demand peak hours, so as to balance the electricity system needs.

 

RES auction exemptions plan discussed by Brussels, locals

Energy ministry and European Commission Directorate General for Competition officials have exchanged views, over the past few days, on a Greek plan seeking the exemption of certain renewable energy sub-categories from RES auctions.

The Greek side needs to support its case as Brussels has not embraced exemptions included in the plan, which is based on recommendations made by RAE, the Regulatory Authority for Energy.

EU directives propose across-the-board auctions for all renewable energy technologies. But the directives do not rule out seperate auctions for RES sub-categories. However, such a move would need to be fully substantiated. Greek officials believe their case is valid.

The Greek plan is seeking approval of a plan for separate auctions concerning wind and PV technologies as well as an exemption from auctions for all other RES technologies, including small-scale hydropower and biomass units, as well wind-energy facilties with capacities of less than 3 MW.

If the Greek plan is approved by Brussels, the energy ministry will need to issue a ministerial decision containing various auction details, including the number of rounds and terms.

According to sources, the Greek plan includes a proposal for separate wind energy auctions, divided regionally, for producers in northwest, central and eastern Greece, and taking into account the differing wind conditions of these respective regions.

The RAE plan primarily focuses on auctions for PV and wind energy products. Pilot auctions for the PV sub-sector have already been successfully staged.

 

Fast-track process for Brussels approval of SGCC’s IPTO move

A decision by the European Commission’s Directorate General for Competition on an agreement between PPC, the main power utility, and China’s SGCC (State Grid Corporation of China), for the latter’s acquisition of a 24 percent stake in the power grio operator IPTO, a PPC subsidiary, could be nearing as the Brussels competition authority is putting the case through a simplified, fast-track procedure.

This would enable the application’s examination to take considerably less time than the many months normally required in Brussels for such cases.

Greek authorities submitted their application to the DG Comp on April 10, seeking its endorsement for the SGCC acquisition agreement. Approval from Brussels would enable the SGCC purchase to go ahead, bringing in needed cash for PPC.

The DG Comp’s eventual refusal to endorse a sale plan for DESFA’s (natural gas grid operator) 66 percent was a key aspect in that privatization attempt’s downfall.

However, SGCC’s interest in IPTO differs as the Chinese company is seeking to buy a minority stake of the operator. Brussels could set specific management terms.

As previously reported by energypress, Brussels has grown increasingly skeptical of strategically significant acquisitions by Chinese firms.

Current indications suggest the IPTO case is making solid progress in Brussels. If so, one final requirement, certification by RAE, the Regulatory Authority for Energy, and energy authorities in Brussels, will be needed to enable the operator’s split. The DG Energy is not expected to fully use up a two-month period it will have at its disposal but, instead, act swiftly and rely on terms set by RAE.

 

IPTO certification procedure taking longer than expected

The certification procedure at IPTO, the power grid operator, a prerequisite for this subsidiary’s split from parent company PPC, the main power utility, and transfer of control to the Greek State is proving to be trickier than originally expected.

Despite recent efforts by local authorities, a delay to the procedure now appears highly likely. The certification procedure is being worked on concurrently with another effort aiming to list a new IPTO holding company on the bourse. This holding company now controls a 51 percent stake of the operator.

Two issues are believed to be holding up IPTO’s certification procedure. RAE, the Regulatory Authority for Energy, has yet to offer its needed approval as it has judged a recent related amendment as being insufficient. This amendment is meant to prevent IPTO’s control from being held by a state agency controlling PPC. Further security has been demanded to ensure the operator’s independence from the power utlity, in line with EU law.

In addition, the meticulousness displayed by the European Commission’s Directorate General for Competition in its part of the overall process is also believed to be holding up the certification procedure.

The DG Comp is generally very cautious when handling cases that could ultimately offer non-EU companies management rights of companies managing European energy networks.

Such DG Comp meticulousness caused a major delay in Greece’s attempt to sell a 66 percent stake of DESFA, the natural gas grid operator, to Azerbaijani energy firm Socar. This deal was eventually cancelled.

More recently, German, French and Italian officials have raised concerns over aggressive takeover attempts by Chinese firms for European enterprises of strategic importance.

The European Commission has examined the possibility of implementing protective measures against non-EU takeover intentions in the technology and defense domains.

Certain pundits believe that an agreement reached between PPC and China’s SGCC (State Grid Corporation of China) for the lattter’s acquisition of a 24 percent stake of IPTO could serve as a crash test for new protective policies adopted in Brussels.

The aforementioned developments make increasingly difficult the chances of IPTO’s certification process being completed within May. This would delay PPC’s badly needed 320 million-euro payment from SGCC for the 24 percent IPTO stake.

 

IPTO sale process may trouble PPC-CMEC power station plan

The main power utility PPC’s plan to forge a partnership with China’s CMEC (China Machinery Engineering Corporation) for the development of Melitis II, a prospective lignite-fired power station of strategic importance in Greece’s north, could be jeopardized by the ongoing approval process required in Athens and Brussels for the power grid operator IPTO’s new company standing following an agreement with another Chinese firm, SGCC (State Grid Corporation of China), to acquire a 24 percent stake in the operator, a PPC subsidiary amid a bailout-required process of breaking away from its parent company.

Both CMEC and SGCC are essentially controlled by one owner, the Chinese State. This could potentially prompt the European Commission’s Directorate General for Competition to intervene on the IPTO certification process as a DG Comp regulation specifies that operator shareholders cannot hold any interests in the supply or production of electricity.

Taking this regulation into consideration, CMEC could ultimately decide to not invest in the Melitis II project.

At this point in time, there is no direct connection between the IPTO certification process and the Melitis II project as the latter is still being examined as an investment prosect by CMEC.

As for the IPTO certification process, RAE, the Regulatory Authority for Energy, has just offered its preliminary approval following an examination on whether the SGCC acquisition agreement for a 24 percent stake of the operator complies with EU criteria. The European Commission will also need to endorse the ownership unbundling procedure before RAE finalizes its approval.

The European Commission is entitled to take up to two months to deliver its decision. If this time is fully utilized, the IPTO split-and-sale process, which has already fallen behind on its tight bailout-related schedule, could be further delayed.

Theoretically, this delay could trigger action for the entire sale of IPTO in place of the current plan, through which the Greek State is expected to end up with a 51 percent stake of the operator. However, the delay, not extensive, is expected to be absorbed.

 

 

PPC racing against time for IPTO sale, concerns growing

The main power utility PPC is racing against time to list a power grid operator IPTO holding company on the bourse by May, a bailout requirement included in the split-and-sale plan for the operator, a utility subsidiary.

According to sources, a plan of the prospectus for the prospective listing of the holding company, to carry a 51 percent stake of IPTO, has already been presented to the Hellenic Capital Market Commission (HCMC).

A finalized prospectus will be established as soon as PPC has posted its financial results for 2016. If the listing’s prospectus were to be finalized now, PPC would need to base it on the corporation’s most recently published financial results, meaning the nine-month results for 2016.

Sources closely connected to the IPTO sale procedure told energypress that the objective is to have finalized both the holding company’s bourse listing and split from PPC within May.

PPC, the operator’s parent company, is looking forward to receiving funds from the sale of a 24 percent share of IPTO to SGCC (State Grid Corporation of China) as well as the sale of a 25 percent stake to the Greek State. The total payment expected from these two sources, estimated at over 620 million euros, promises to offer financial relief to PPC, burdened by a poor cash flow.

In more recent times, market officials have expressed growing concern over the IPTO sale’s prospects, fearing its possible collapse, as was the case with the long-running attempt to sell a 66 percent stake of DESFA, the natural gas grid operator, to the Azerbaijani energy firm Socar, with Italy’s Snam as a partner.

The European Commission’s Directorate General for Competition had intervened on the DESFA sale, citing competition concerns. The DG Comp demanded that the Azerbaijani company surrender a portion of the majority DESFA stake it had agreed to acquire and become a minority partner in the deal.

With China’s SGCC set to become involved in IPTO’s future management decisions, Brussels appears to be examining the introduction of protective measures that would prevent aggressive takeovers by Chinese firms, subsidized by the Chinese State to outbid rival buyers in tenders.

PPC and the Greek government would want to have pressed ahead with the IPTO sale prior to the implementation of any such restrictive measures by Brussels.