EVIKEN calls for gov’t response to rising industrial energy costs

EVIKEN, the Association of Industrial Energy Consumers, has called for a firm government response to rising energy costs in a harshly worded statement claiming a conscious effort is being made to undermine the Greek industrial sector’s aim of increasing its contribution to the country’s GDP, employment and investments.

Though the main power utility PPC has not been directly criticized in the EVIKEN statement, the complaints are unquestionably aimed at the utility’s board.

In its statement, the industrial energy consumers association contends an attempt is being made to end institutionalized discounts that are based on consumer profiles and operating costs at the main power utility PPC. EVIKEN also notes the power utility is seeking to impose unjustified tariff hikes.

Any demands for further cost increases, which would add to the already increased CO2 emission right costs faced by industrial enterprises, are unsubstantiated and inappropriate, while an attempt to abolish industrial tariff discounts is discriminatory, EVIKEN notes.

“We call upon the government and prime minister to take appropriate decisions so that the industrial sector’s recovery effort and target for employment growth are not endangered,” the statement concludes.

EVIKEN protests CO2 cost treatment of major consumers

EVIKEN, the Association of Industrial Energy Consumers, has filed a complaint to RAE, Greece’s Regulatory Authority for Energy, claiming discriminatory treatment of high-voltage electricity consumers by the main power utility PPC over CO2 emission right costs.

High-voltage industrial electricity consumers shoulder the full extent of CO2 emission right cost increases as these costs are included on their electricity bills as separate surcharges. On the contrary, all other consumers enjoy steady tariff levels as CO2-related charges are not included on their bills. EVIKEN has requested an explanation for this conflicting billing approach.

It is estimated that PPC’s decision to absorb higher CO2 emission costs for all other consumer categories is costing the state-controlled power utility additional costs worth between 430 and 440 million euros per year.

EVIKEN also filed a second complaint to RAE requesting an examination of lower mid-voltage tariffs for industrial consumers sharing the same energy profiles as high-voltage consumers. Mid-voltage tariffs are lower by as much as five euros per MWh compared to tariffs paid by high-voltage consumers sharing identical energy profiles.



Industry, seeking clarity, demands two-year electricity tariff deals with PPC

The country’s energy-intensive industrial sector is demanding two-year electricity tariff agreements, until the end of 2020, with the main power utility PPC, for greater clarity and stability concerning energy costs to be faced next year.

Shorter-term energy cost planning threatens the sustainability of enterprises in certain sub-sectors, industrialists have warned, adding that energy-cost support for the industrial sector, playing a vital role in Greece’s economic recovery effort, is essential.

Local industrial enterprises, appearing united and adamant, are refusing to sign PPC electricity tariff agreements limited to 2018 and insist on two-year deals.

Separate CO2 emission right cost payments, as is the arrangement at present, would be accepted, industrial sector officials have indicated.

An existing demand response mechanism (interruptability) – compensating major-scale consumers, such as industrial enterprises, 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 – expires in 2019 but the new market conditions to be shaped by a succeeding permanent CAT mechanism remain unclear.

EVIKEN, the Association of Industrial Energy Consumers, has urged energy minister Giorgos Stathakis to seek European Commission approval for a continuation of the demand response mechanism in tandem with the permanent CAT mechanism.


Industrialists, PPC question cost impact of gas network expansion

EVIKEN, the Association of Industrial Energy Consumers, and the main power utility PPC have both raised sustainability-related objections to a gas network expansion plan covering 18 municipalities in northern and central Greece, included by gas distributor DEDA in its five-year development plan.

Participating in public consultation staged by DEDA, EVIKEN pointed out that the gas distributor’s five-year plan makes no mention of the impact on distribution network surcharges.

RAE, the Regulatory Authority for Energy, has already endorsed distribution network surcharges for central Greece, a region of heightened industrial activity. The area’s gas network is already developed but will be expanded. RAE will need to ensure that existing network charges are not increased to cover the cost of the network’s expansion, the industrial consumers association stressed in its intervention.

PPC also raised sustainability concerns regarding the gas network’s expansion to previously non-serviced areas.

RAE is expected to approve DEDA’s five-year development plan by October 10, when the gas distributor, a wholly-owned subsidiary of DEPA, the public gas corporation, plans to proceed with tenders for the development of the natural gas networks.

The DEDA tenders are planned to cover all development aspects of the projects, including procurement, project management and construction. A total of 11 or 12 tenders are being planned.


Supplier surcharge a regulated charge, EVIKEN reminds

Any decision to consolidate the current RES-supporting supplier surcharge paid by electricity suppliers and force them to incorporate it into their competitive pricing policies, even though this surcharge clearly represents a regulated charge that was introduced to support the RES sector, would amount to a stab in the back for the competitiveness of Greek industry at a time when efforts are being made to revitalize Greek industry, EVIKEN, the Association of Industrial Energy Consumers, has underlined in a letter forwarded to energy ministry Giorgos Stathakis and highly-ranked associates.

Consumers are already paying a high-leveled ETMEAR RES-supporting surcharge and, therefore, are entitled to lower wholesale electricity prices, currently the most expensive in Europe by far, the association noted in its letter.

Also, if the supplier surcharge is consolidated and, as a result, passed on to consumer electricity bills rather than being absorbed by suppliers, as is the case at present, then this would eliminate the benefits of relief measures offered to energy-intensive industrial enterprises, EVIKEN supported.

Thirdly, Greece’s revised bailout demands a full replacement of the supplier surcharge, EVIKEN reminded in its letter to the government officials.

Recent media reports have suggested the supplier surcharge could be extended.




Industrial sector updated on forthcoming ETS revisions

EVIKEN, the Association of Industrial Energy Consumers, and counterpart associations from all over Europe, have met with Directorate-General for Climate Change (DG CLIMA) officials to be updated on forthcoming EU Emission Trading System (ETS) revisions.

Organized by IFIEC Europe, the International Federation of Industrial Energy Consumers, the meeting involved the participation of over 20 national and sector representatives, including representatives from EVIKEN, Alliance, Eurofer, Eurometaux, EU Lime, EU Fertilizers and EU Salt.

Particpants were informed that the ten-year period to cover 2021 to 2030 has been divided into two five-stages for most matters, the objective being to faciliate corrective interventions.

A finalized ETS directive is expected in March, while a preliminary Carbon Leakage List is planned to be published in May, the DG CLIMA officials informed, timed to allow for national-level reactions concerning sectors that could be marginally beyond the limits. Any reactions will need to be officially forwarded by June 30.

The European Commission is working on an arrangement that would free emission rights for a variety of industrial activities without undermining energy efficiency efforts.

EVIKEN: Target model reforms to nurture market distortions

EVIKEN, the Association of Industrial Energy Consumers, has expressed deep concerns felt by the country’s industrial energy consumers, as well as outright opposition, over regulation changes being prepared as part of the target model.

The association, in a letter contributed to a public consultation procedure staged by LAGIE, the Electricity Market Operator, has listed a series of key concerns, underlining that the revisions being planned would continue to nurture market distortions, maintain obstacles disenabling true regional market interconnections, and, ultimately, increase energy costs for consumers, a prospect that threatens to affect the industrial sector’s level of competitiveness.

The target model process aims to harmonize the electricity wholesale market with EU standards.

In the lead-up to the reforms, the industrial sector has anticipated the establishment of a truly competitive energy market, along the lines of other EU member state markets.

In comments to energypress, one industrial sector official noted that the planned reforms would increase energy costs and create a new high-cost market in which competitive industrial production cannot exist, adding that, if implemented, the measures will help establish an oligopoly.

Besides expressing its opposition to the planned reforms in the letter forwarded to LAGIE, the industrial energy consumers association has also informed the European Commission of its concerns.

Industrial sector calls for end to energy price-inflating term

The country’s energy-intensive industrial sector has called for the abolishment of a minimum-offer rule imposed on electricity producers, believing this requirement is distorting prices and affecting levels of competitiveness.

The request, agreed to at a recent EVIKEN (Association of Industrial Energy Consumers) meeting, would help improve operating terms and support rather than undermine industrial output, the association believes.

The industrial sector believes the minimum-offer rule imposed on electricity producers is significantly increasing prices, especially during low-demand hours, compared to price levels elsewhere in Europe.

Major-scale consumers could decrease their energy costs during low-demand hours but are forced to buy energy at high prices, which is affecting levels of competitiveness.

The industrial sector wants the lifting of the minimum-offer rule incorporated into Greece’s bailout-required electricity market reforms, intended to allign the country with the target model, aiming for a single European electricity market.

Besides target model-related revisions, the industrial sector is also anticipating an extension to the demand response mechanism (interruptability), which expired at the end of September.

According to government sources, a technical review of the extension plan haas been completed and discussions with European Commission officials are at an advanced stage.

The mechanism enables major industrial enterprises to be compensated when the TSO (ADMIE/IPTO) requests that they shift their energy usage by lowering or stopping consumption during high-demand peak hours so as to balance the electricity system’s needs.


Distribution costs ‘too high’ for mid-voltage industrial consumers

EVIKEN, the Association of Industrial Energy Consumers, anticipating upcoming revisions to network distribution costs for consumers within the next couple of months, has forwarded a letter to RAE, the Regulatory Authority for Energy, calling for a reduction of these charges imposed on major industrial consumers belonging to the mid-voltage category.

The association contends that the current network distribution costs for this group of consumers are disproportionately high.

Current network distribution charges are calculated according to a formula set ten years ago. It needs to be updated by January to reflect the grid’s actual conditions.

EVIKEN, in its letter, has proposed the establishment of a new category that would group together major mid-voltage industrial consumers who use over 13,000 MWh per year and high-voltage consumers sharing equivalent consumer profiles. The intention of this proposal is to subject both groups to equal distribution costs, as is the case with RES-supporting ETMEAR and public service YKO surcharges.

EVIKEN: NOME changes would stifle competition, prevent fair access

NOME auction revisions proposed by local authorities would stifle competition and prevent independent suppliers from gaining fair access into the country’s energy mix, EVIKEN, the Association of Industrial Energy Consumers, taking part in a public consultation procedure held for feedback concerning the changes, has noted.

In its letter, forwarded to authorities earlier this week, EVIKEN reiterated previous reservations expressed over the effectiveness of the auctions as a tool capable of opening up the electricity market to competition – amid the current conditions.

“We believe that the adoption of regulatory measures ensuring a balanced distribution of benefits for all consumer categories should be the priority[at this stage],” the EVIKEN letter highlighted.



Industrialists want NOME exclusion, noting ‘no supplier competition’

EVIKEN, the Association of Industrial Energy Consumers, in a letter forwarded to RAE, the Regulatory Authority for Energy, has requested the exclusion of high-voltage electricity amounts from NOME calculations, noting that, one year since their introduction, the auctions have failed to make any impact on the high-voltage electricity market, leaving the main power utility PPC as the sole option for industrial consumers.

The RAE board is expected to meet within the current week, possibly today, to decide on whether to break up an increased NOME electricity amount of 720 MWh/h for the remainder of 2017 into two lots.

EVIKEN, which made the high-voltage exclusion request – estimated at 6,800 GWh, annually, by the association – as part of its first appraisal, one year since the arrival of the NOME auctions, is also expected to take its case to the European Commission, sources informed.

The association, in its letter, also notes that the progress towards a more competitive environment for suppliers has been extremely slow and showing signs of a slowdown.

EVIKEN also makes note of an uneven impact made by the NOME auctions, so far, on the electricity market’s sub-categories. The association pointed out that PPC has lost over 30 percent in the mid-voltage category, no more than 10 percent in the low-voltage category, and lost no ground in the high-voltage supply category.

Independent, 3-year extension sought for interruptability tool

The Greek government’s plan to apply to the European Commission for an extension of the demand response mechanism (interruptability) should be made independently, request a three-year duration, and not be associated with a bid seeking more time for the exisiting temporary mechanism, EVIKEN, the Association of Industrial Energy Consumers, noted in a statement forwarded to energy minister Giorgos Stathakis yesterday.

A three-year time period for the fixed mechanism could enable the measure’s developmental qualities to take effect, the association noted.

EVIKEN, in its statement to the energy minister, stressed that the demand response mechanism is a key factor in ensuring a level playing field for local industry against European competitors, while also being a vital tool to restrict high energy costs burdening Greek industry.

The energy minister has announced he will seek an extension for the mechanism. The minister is also expected to seek certain revisions, including the exclusion, from the measure, of main power utility PPC mines, which absorb approximately 8 million euros of the measures 40 million-euro total cost.

The current demand response mechanism (interruptability), enabling major industrial enterprises to be compensated when the TSO (ADMIE/IPTO) requests that they shift their energy usage by lowering or stopping consumption during high-demand peak hours so as to balance the electricity system needs, is due to expire in November.

Most crucially, the energy minister will need to decide whether the RES sector, especially photovoltaic producers, will carry on covering most of the measure’s cost, or consider revising its funding system. Though the issue remains unresolved at this stage, the minister does not appear willing to proceed with any fundamental changes that may further burden state-controlled PPC.



EVIKEN officials discuss industrial issues with minister

Energy-intensive industrial enterprise concerns were discussed at a meeting yesterday between EVIKEN (the Association of Industrial Energy Consumers) officials and energy minister Giorgos Stathakis.

The approaching ends of existing industrial electricity supply deals established between industrial firms and the main power utility PPC and the current cost-saving demand response mechanism have generated unease amid industrial-sector ranks.

The current demand response mechanism (interruptability), enabling major industrial enterprises to be compensated when the TSO (ADMIE) asks them to shift their energy usage (lower or stop consumption) during high-demand peak hours, so as to balance the electricity system needs, is due to expire in November.

At yesterday’s meeting, EVIKEN officials expressed their concerns over the demand response mechanism’s approaching end, fearing electricity cost increases that would negatively impact the industrial sector’s level of competitiveness.

Official market data indicates that manufacturers, battling amid the persisting Greek recession, are showing signs of recovery.

EVIKEN is expected to release an announcement today detailing its views and objectives for the near future, including details of its propoal forwarded to the energy minister for the demand response mechanism. A reaction by the association to the government’s agreement with the country’s lenders on the Greek bailout’s second review, announced yesterday, is also expected to be included in the EVIKEN announcement.

Legislation for a permanent demand response mechanism is not expected to have been ratified by November, when the current system expires.

Even so, EVIKEN officials emerged feeling confident of positive measures being taken following their meeting with the energy minister yesterday. The session was more constructive than previous meetings, industrial sources informed.

The uncertainty felt by industrial enterprises over future electricity supply deals with PPC was also stressed during the meeting.

The energy minister promised that a finalized plan for revisions to a RES-supporting ETMEAR surcharge would soon be announced. Upper limits for ETMEAR payments made by energy-intensive enterprises are expected to be set. This is expected to reduce surcharge-related costs for various industrial sectors.

Energy cost vital for strategic planning, EVIKEN chief tells Canete

The cost of energy needs to be factored in as a basic component of the EU’s strategic energy planning, EVIKEN, the Association of Industrial Energy Consumers, has stressed to the European Commissioner for Climate Action and Energy Miguel Arias Canete.

“We believe that energy planning must not only be based on geopolitical criteria but should also satisfy market needs and lead to bearable energy prices for consumers,” noted EVIKEN’s president Konstantinos Kouklelis.

The industrial consumer association’s chief official added that energy planning is needed at both European and national levels in order to provide answers to issues such as energy mix planning; electricity, natural gas and LNG storage; energy efficiency policies; and demand response mechanism designs.

Kouklelis acknowledged that the EU has adopted extremely ambitious policies for renewable energy sector development, while also observing that power stations running on conventional fossil fuels and nuclear energy are being replaced by renewable energy sources, both solar and wind, at a rapid pace.

RES sector issues such as subdued PV electricity production experienced during sunset and sunrise, inadequate storage system development, as well as the need for new energy transmission and distribution networks, all need to be resolved, the EVIKEN chief added.

EVIKEN raises gas auction transparency concerns

EVIKEN, the Association of Industrial Energy Consumers, has raised concerns claiming a lack of transparency in gas auctions held by DEPA, the Public Gas Corporation.

The fears were raised in a letter forwarded to the European Commission’s Directorate-General for Competition.

DEPA has agreed to take on staging the auctions, offering increased natural gas amounts to the market as a means of generating competition, after committing to demands made following research conducted by an independent gas market authority.

In its letter, EVIKEN advised that a list of prospective auction participants should be published prior to auctions and, as a follow-up, results detailing orders and quantities made by participants must also be made available as a means of protecting transparency standards.

The association noted that the procedures observed in the just-introduced NOME auctions in the electricity market should be used as a model reference.

The NOME auctions, introduced in October, are intended to provide third parties with access to PPC’s low-cost lignite and hydropower sources as a measure to help break the utility’s market dominance.

Industry requests ‘disruption management’ measure extension

EVIKEN, the Association of Industrial Energy Consumers, has forwarded a written request to the energy ministry seeking an extension to the energy cost-saving “disruption management” mechanism, expiring in slightly less than a year.

The European Commission has just endorsed an equivalent German “demand response” plan, bringing the issue to the fore. The German system will be valid until July, 2022.

Greece’s industrial sector has highlighted that the measure’s extension is essential to prevent a void that could prompt unpredictable repercussions for Greek industry, already lacking a competitive edge in terms of energy costs.

The ‘disruption management’ mechanism enables major industrial enterprises to benefit from electricity cost savings in exchange for shifting energy usage to off-peak hours whenever required by the operator.

The government’s new Environment and Energy Minister Giorgos Stathakis, appointed last Friday, will be the recipient of the request, forwarded to his predecessor Panos Skourletis, who now heads the Ministry of Interior Affairs.

As one of its arguments, EVIKEN, in its request, noted that Greece’s ‘disruption’ mechanism was approved back in October, 2014, but not implemented until March, 2016. It expires on October 15, 2017.

The association noted that the Greek mechanism was endorsed by Brussels for a maximum period of three years, a time period that cannot be fully utilized as a result of the delay, caused by a lack of framework.


Industrialists call for return of excessive gas distribution fee

Energy-intensive industrial enterprises are calling for a return of amounts paid from August, 2015 to the present day as a result of a sharp natural gas distribution surcharge hike, from 1.5 euros to 4 euros per MWh, which resulted from Greece’s third bailout agreement.

The surcharge hike had sparked a strong reaction from EVIKEN, the Association of Industrial Energy Consumers, which, through a series of announcements and letters, condemned the move as one made to finance the compensation of the country’s three EPA gas supply companies for the premature end to their regional monopolies.

A new policy decided on by RAE, the Regulatory Authority for Energy, will reduce the gas distribution surcharge for energy-intensive industries to levels below the 1.5 euros per MWh charged prior to the sharp hike.

Certain industrial enterprises are now calling for a retroactive return of excessive amounts – the difference between the 4 euros per MWh charged and the new RAE-endorsed rate – paid since August, 2015.

Officials at these industrial enterprises believe cross subsidization practices have taken place during this period, noting that the excessive amounts should be offset.

Besides the number of industrial enterprises seeking returns, EVIKEN has also prepared a statement backing the demand.

Authority’s fixed CAT plan headed in right direction, EVIKEN notes

A proposal made by RAE, the Regulatory Authority for Energy, for the country’s fixed CAT mechanism to compensate electricity producers is headed in the right direction as, compared to the current temporary CAT model, it factors in a wider range of selection criteria for producers, EVIKEN, the Association of Industrial Energy Consumers, has noted in letter sent to the authority. A public consultation procedure for the mechanism is now in progress.

In its letter, EVIKEN also pointed out that the fixed CAT mechanism needs to take into account the electricity market’s imminent restructuring.

In addition, the association noted that the “disruption management” plan – enabling major industrial enterprises to benefit from electricity cost savings in exchange for shifting energy usage to off-peak hours whenever required by the operator – which is scheduled to remain valid until October, 2017, will need to be extended until the target model, Greece’s series of adjustments needed to meet the EU’s wider plan for an integrated energy maket, is fully implemented.

Industry ‘negatively surprised’ by ETMEAR surcharge relook

The energy ministry’s negative response, at a recent meeting, towards the industrial sector’s concerns over a RES-supporting ETMEAR surcharge included on elecrtricity bills has negatively surprised industrialists, which has created an urgent need to restore confidence between the two sides as a means towards reviving local industrial production, according to a letter forwarded by EVIKEN, the Association of Industrial Energy Consumers, to energy minister Panos Skourletis and other related energy authorities.

EVIKEN has taken action as the energy ministry, it was understood during the recent meeting, is reexamining the ETMEAR surcharge’s distribution details one month before it is expected to submit its proposal to the European Commission, an initiative prompted by EU directives.

If the EU directives are not fully implemented, then the industrial sector would face retroactive charges for 2014 and 2015 totaling more than 12 million euros annually, EVIKEN noted, whereas implementation would offer industry a considerable reduction of about 1.5 to two euros per MWh. Smaller industries stand to benefit even more considerably by as much as nine euros per MWh.

At this stage, industrialists believe that a lack of understanding and communication stands between the sector and the energy ministry.

The industrial sector’s ETMEAR-related concerns follow a recent government decision to exclude industrial enterprises with electricity supply permits from taking part in the upcoming NOME auctions – beginning September, which will provide third parties with access to main power utility PPC’s low-cost lignite and hydropower sources – as well increased distribution fees and imminent natural gas transportation costs.





EVIKEN reacts to law barring industry from NOME auctions

EVIKEN, the Association of Industrial Energy Consumers, in a letter forwarded to the Greek government, has strongly protested against a decision that excludes industrial units from taking part in the upcoming NOME auctions. The association is also expected to take the matter to the country’s international creditors.

The NOME auctions, due to begin in September, will provide third parties with access to main power utility PPC’s low-cost lignite and hydropower sources as part of the bailout-related obligations intended to break the utility’s dominance.

In its letter to the government, EVIKEN contends that recent legislation’s exclusion of industrial units holding electricity supply permits from NOME auctions creates unfair competition in the electricity market. The law provides regulatory intervention that prevents fair trade practices, the association argues.

In the same letter, EVIKEN notes that the NOME-related objectives of reducing PPC’s market dominance cannot be achieved if industrial units are not offered access to the auctions without restrictions.

Major industrial enterprises such as cement producer Titan already hold electricity supply permits, while others, including copper, aluminum and cable producer Viohalko and textile company Epilektos, soon expected their permits to be issued.

A wider reaction from industries can be expected if the NOME participation restrictions imposed are not lifted.

End of tax on gas relief for PPC, widens supplier profit margins

The elimination of a Special Consumption Tax (EFK) imposed on natural gas purchased and used by gas-fueled power stations is a favorable development for such production units, primarily because the initiative comes as an adjustment by Greece to a related EU directive.

For electricity suppliers, especially PPC, the main power utility, the lifting of the tax will offer direct economic benefits, as suppliers ultimately covered the tax imposed on natural gas through their wholesale electricity trading activities.

According to intial estimates, the tax’s elimination, ratified in Greek Parliament last night as part of a superbill carrying requirements needed for the completion of the first review of Greece’s third bailout package, will lessen the tax burden for suppliers by an annual amount of over 85 million euros. The measure comes into effect on June 1.

Besides offering PPC some breathing space, the measure will also provide the corporation with the opportunity to eventually reduce its tariffs for consumers. Such a prospect is being heavily supported by energy minister Panos Skourletis.

For PPC’s rival independent electricity suppliers, the reduction of wholesale electricity prices, as a result of the elimination of the tax on natural gas, will increase their profit margins and allow them to make even greater price cuts in offers being made to lure customers away from the main power utility.

The upcoming NOME auctions, also ratified last night as part of the superbill and scheduled to be launched in September, will provide considerable impetus to the bailout-related objective of reducing PPC’s wholesale and retail electricity market shares.

NOME auctions will provide third parties with access to PPC’s low-cost lignite and hydropower sources as part of the bailout-related obligation to help break the utility’s dominance.

An amount equivalent to eight percent of the retail electricity market’s total demand in 2015 will be offered by PPC through the NOME auctions in 2016. In 2017, the amount to be offered will be increased to 12 percent of the retail electricity market’s total demand in 2016. The objective is to have decreased PPC’s retail electricity market share by 20 percent at the end of 2017. In 2018 and 2019, 13 percent of the retail electricity market’s demand for 2017 and 2018, respectively, will be offered through the NOMΕ auctions with the objective of reducing PPC’s retail electricity market share to less than 50 percent by 2020.

Electricity suppliers registered with LAGIE, the Electricity Market Operator, will be entitled to take part in the NOME auctions. On the contrary, PPC and major-scale industrial consumers will not be permitted to participate.

EVIKEN, the Association of Industrial Energy Consumers, expressed its satisfaction over the energy-related measures included in last night’s superbill as it includes a gradual tax reduction for natural gas used in industry. The initiative could utimtately help reduce industrial costs, the association noted.


PPC, responding to EVIKEN, defends ‘disruption plan’ auction rights

The main power utility PPC has defended its right to participate in the “disruption management” plan’s auctions – intended to enable energy cost savings for major-scale industry in exchange for shifting energy usage to off-peak hours whenever required by the power grid operator – in a letter forwarded yesterday to EVIKEN, the Association of Industrial Energy Consumers. EVIKEN had recently reacted against the utility’s involvement in the “distruption plan” auctions.

PPC undermined the recently introduced “disruption management” plan’s second auction session late last month by submitting extremely low offers intended to flatten session prices, sparking protest by disgruntled energy-intensive industry officials.

In its letter, PPC noted that it was surprised by EVIKEN’s intervention, adding that the initiative created a “particularly unfavorable impression.”

EVIKEN has created an impression that it does “not recognize the efforts and sacrifices made by PPC to supply electricity to [industrial] enterprises – members of the association – at the lowest possible prices, based on current conditions,” PPC noted in its letter. Both the association and high-voltage consumers have previously acknowledged PPC’s efforts, the utility added.

PPC also noted that EVIKEN will need to offer a “reasonable response as to why an administration representing shareholders of an enterprise listed on the bourse, and appointed to protect their interests…should be barred from the ‘distruption plan’ auctions.”

In its letter to EVIKEN, PPC noted that the industrial association knows very well that no such agreement or obligation was made, or could be made.

The utility also pointed out that it had not made full use of the capacity it is entitled to for the auctions when it registered with IPTO, the power grid operator, to take part.

PPC is interested in favorable and constructive cooperation with EVIKEN and all high-voltage consumers, the power utility stated in the letter, adding that it intends to contribute to the maximization of benefits offered to all sides by the “disruption plan”.

Yesterday, EVIKEN, in a letter forwarded to IPTO – ahead of public consultation procedures for revisions to two articles of the “disruption plan” auction regulations – asked the operator to examine whether PPC has the right to partipate in the auctions.

Industrial group wants PPC barred from ‘disruption’ plan auctions

EVIKEN, the Association of Industrial Energy Consumers, has forwarded a letter to leading local energy-sector authorities calling for main power utility PPC to be excluded from the “disruption management” plan’s auctions, protesting that the utility’s participation is having major negative impact on negotiations between PPC and industrial energy-intensive enterprises for individual tariff agreements.

Just days ago, PPC undermined the recently introduced “disruption management” plan’s second auction session by submitting extremely low offers intended to flatten the session, sparking protest by disgruntled energy-intensive industry officials.

The “disruption management” plan is intended to enable energy cost savings for major-scale industry in exchange for shifting energy usage to off-peak hours whenever required by the operator. If the plan fails to sufficiently reduce energy costs for industrial enterprises, then the latter can be expected to reassess their positions on the tariff negotiations with PPC.

It is believed that a number of major-scale industrial enterprises that have already signed new tariff agreements with PPC are reexamining their respective deals.

The EVIKEN letter calls for PPC’s exclusion from the “disruption management” plan’s auctions even if a ministerial decision needs to be signed to accomplish this. The association, in the letter, recalled recent remarks made by energy minister Panos Skourletis, who described the “disruption” plan as a tool to help offset the elimination of a 20 percent electricity discount offered to industrial consumers. The offer ended at the end of 2015.

The EVIKEN letter was sent to Skourletis, deputy industry minister Theodora Tzagri, RAE (Regulatory Authority for Energy) chairman Nikos Boulaxis, and PPC’s chief executive Manolis Panagiotakis.


EU policies increasing energy costs, EVIKEN tells Sefcovic

EU energy policies being implemented in Greece are increasing energy costs and blocking the liberalization of markets as a result of consequent market distortions, officials of EVIKEN, the Association of Industrial Energy Consumers, contended during a meeting in Athens yesterday with Maros Sefcovic, the European Commission vice president responsible for Energy Union.

The industrial consumer association representatives, who were joined at the meeting by members of SEV, the Hellenic Association of Industrialists, did not hesitate to frame the EU, noting that, in some cases, these unfavorable market developments are being tolerated by the European Commission.

The EVIKEN officials submitted a series of demands aimed at countering the market distortions, including the implementation of bilateral agreements and a decrease of natural gas distribution fee costs.

As for the electricity market, EVIKEN demands included an immediate start in the transition towards the target model, exemption of surcharges imposed on imported electricity, and interconnection upgrades.

For the natural gas market, EVIKEN demanded the cancellation of a distribution fee hike, the exclusion of EPA gas supply companies from gas auctions for as long as they remain subsidiaries of DEPA, the Public Gas Corporation, a doubling of the gas amounts auctioned, a reduction to the special consumption tax (EFK) imposed on gas, and reinforced and upgraded interconnections linking Greece, Bulgaria, and Romania.

Sefcovic, who was in Athens as part of a tour of European capitals to check on energy union progress of EU member states, also held separate meetings with Prime Minister Alexis Tsipras, energy minister Panos Skourletis, and other local officials.

Sefcovic in Athens Thursday as part of Energy Union tour

Maros Sefcovic, the European Commission vice president responsible for Energy Union, is scheduled to travel to Greece this Thursday on an official visit whose agenda will include a tour of the gas grid operator DESFA’s facilities in Elefsina, west of Athens.

Sefcovic’s schedule also includes a meeting with energy minister Panos Skourletis, the administrations of DESFA and RAE, the Regulatory Authority for Energy, while he will also participate at a meeting organized by SEV, the Hellenic Association of Industrialists, and EVIKEN, the Association of Industrial Energy Consumers.

His visit to Greece is part of a tour of European capitals intended to promote Energy Union. Most recently, Sefcovic visited Cyprus and Bulgaria.

Energy ministry forming committee to look at industrial energy costs

The Enviroment and Energy Ministry is assembling a committee to be charged with examining energy cost issues concerning Greece’s industrial sector, according to energypress sources.

The ministry’s initiative to form the committee follows a recent meeting between energy minister Panos Skourletis with representatives from EVIKEN, the Association of Industrial Energy Consumers, during which the sector’s energy cost problems were presented by industrialists.

According to EVIKEN, prospective supply agreements to be reached between industrial enterprises and PPC, the main power utility, or DEPA, the Public Gas Corporation, may offer favorable energy-cost results, but these benefits risk being offset by various regulated charges and heavy taxes imposed on energy, making the sector non-competitive.

The industrial sector wants the various regulated charges to be restricted, if not abolished, as it believes they do not offer considerable revenues to the state but, even so, significantly reduce Greek industry’s level of competitiveness and lead to job losses, ultimately affecting state revenues and contributions to social security funds.

The industrial sector is placing particular emphasis on the need to reduce the RES-supporting ETMEAR surcharge imposed on electricity bills, as well as a lignite-related surcharge, based on EU guidelines concerning state aid for energy-intensive industries.



Industrialists stress heavy energy-cost burden to minister

The country’s energy-intensive industrial enterprises are holding back on signing new tariff deals with PPC, the main power utility, because their finances do not add up unless a package of energy-related measures agreed to by the government – widely applied throughout Europe – is implemented, members of EVIKEN, the Association of Industrial Energy Consumers, have informed energy minister Panos Skourletis.

The industrialists want an EU guideline concerning regulated charges (Article 189) as well as a guideline for special consumption tax (Article 96), which dates back to 2003, to be implemented before finalizing their agreements with PPC. These measures would not further burden the state budget, they pointed out.

Overall, numerous local energy-intensive industrial enterprises, weighed down by exorbitantly high energy costs and Greece’s ongoing recession, now roughly six years long, are struggling to remain afloat. Also, European rivals are enjoy increasing comparative advantages over Greek industries as a result of the adoption of guidelines by their respective governments.

Worse still, PPC is scheduled to introduce new tariff rates next month, which are expected to be significantly higher as a result of the abolishment of a 20 percent discount offered to major-scale industries, which was agreed to at a recent extraordinary shareholders meeting. The preceding discount rate will be replaced by a smaller discounts divided in sub-categories, based on consumer profiles.

Besides the needed implementation of the aforementioned measures, the energy-intensive industrial sector is also waiting for the introduction of the “disruption management” plan, to enable energy cost savings for major-scale industry in exchange for shifting energy usage to off-peak hours whenever required by the grid operator. Its arrival has been delayed by demands raised by certain renewable energy source (RES) officials, seeking lower financial contributions by RES firms to the plan’s mechanism.

The industrial sector cannot establish a clear picture of its overall energy-related cost levels unless matters such as the aforementioned are resolved and implemented. Certain local industrial sector officials believe the government now fully comprehends the frail positions of industry and the need to implement measures that will help Greek enterprises stand up against fellow EU competitors.