Supplier overdue payments to operators reaches €350m

Overdue payments owed by energy suppliers to the country’s market operators have been on the rise since summer, now exceeding 350 million euros, a development that has prompted the government to consider implementing an installment-based payment schedule as part of the solution.

The sharp increase in wholesale electricity prices over recent months has had a severe affect on the cash flow of suppliers, putting them under major financial pressure.

However, it should be pointed out that the majority of this 350 million-euro amount owed by suppliers to operators concerns the power utility PPC and includes a considerable amount owed from long before the current energy crisis.

Power grid operator IPTO, distribution network operator DEDDIE/HEDNO, and RES market operator DAPEEP are all owed sums by the country’s suppliers.

RAE, the Regulatory Authority for Energy, is now considering a three-part solution entailing:  provision of letters of guarantee by suppliers to the operators, to prevent any further rise of the debt owed; immediate deposits covering 50 percent of amounts owed, either in cash or through bank guarantees representing equivalent amounts; and settlement of the remaining 50 percent through an installment-based schedule of between 8 to 12 payments, depending on respective agreements.

RAE forced to reset Cretan market target model entry for November 1

RAE, the Regulatory Authority for Energy, has reset the target model entry of Crete’s electricity market for November 1, a month beyond a previous date set by energy ministry legislation, to enable full development of information systems to be used by operators and their associates, and also ensure that consumers are better informed on the transition, the authority’s president Thanasis Dagoumas has announced.

This change of date highlights the fact that time had run out for the settlement of pending issues ahead of the previous October 1 launch date for a Cretan hybrid model, intended to offer protection against extreme fluctuations in the balancing market.

As previously reported by energypress, RAE, last week, requested updates from the operators (power grid operator IPTO, distribution network operator DEDDIE/HEDNO, RES market operator DAPEEP) as well as the energy exchange, on their level of readiness, technically, for the Cretan electricity market’s target model entry on October 1.

It can be presumed that at least some of these agencies had not completed actions required in their respective domains for a launch tomorrow.

Major investment interest in PPC equity capital increase

Power utility PPC’s equity capital increase, planned for late October, is expected to attract over one billion euros, in excess of the 750 million-euro amount initially announced, strong interest by foreign institutional investors, including major US interest, as well as dozens of meetings lined up for the coming weeks with potential participants, has indicated.

The next fortnight or so is expected to be filled with non-business news concerning PPC’s equity capital increase, the related topics to include discussion on possible participants, as well as political debate over the equity capital increase, effectively a partial privatization that will result in a decrease of privatization fund TAIPED’s current stake in the company from 51 percent to 34 percent.

The development promises to free the utility from restrictions imposed on state-controlled companies, boost its finances and enable the company to further consolidate its position as the dominant market player. Small and big energy players are expected to be impacted by the PPC move. Talk of takeovers is already brewing.

The equity capital increase, along with PPC’s not-yet-finalized sale of a 49 percent stake of distribution network operator DEDDIE/HEDNO, a subsidiary, to Australian fund Macquarie for 2.116 billion euros, will offer crucial financial support for PPC’s 8.5 billion-euro investment plan covering the next five years. Green energy production and ventures abroad are the plan’s key objectives.

Crete market’s target model entry behind schedule

Delays observed in technical preparations by operators for the target model entry of Crete’s electricity market have resulted in pending issues that could prevent next month’s launch date from being achieved.

The energy ministry has prepared legislative revision stipulating a launch of a hybrid model for Crete on October 1.

In response to the delay, RAE, the Regulatory Authority for Energy, will request updates from the operators (power grid operator IPTO, distribution network operator DEDDIE/HEDNO, RES market operator DAPEEP) as well as the energy exchange, on their level of readiness, technically, for the Cretan electricity market’s target model entry at the beginning of next month.

RAE will reset the current launch date if it judges preparations to be at an unsatisfactory level. A one-month extension, for a November 1 launch, is possible.

 

 

PPC net debt drops below €3bn, Macquarie deal may push figure lower

Power utility PPC, expected to post first-half results today, will reportedly announce a net debt figure (total debt minus cash reserves) of less than three billion euros, following an extended period above this level, brought down by the company’s two securitization agreements with JP Morgan and Pimco for unpaid receivables.

The two securitization deals, worth a total of approximately 370 million euros, have helped reduce PPC’s net debt to less than three billion euros for the first half. PPC’s net debt for the first quarter was worth 3.27 billion euros.

The power utility’s net debt could drop even further once a recent 2.116 billion-euro agreement with Australian fund Macquarie, for its acquisition of a 49 percent stake in distribution network operator DEDDIE/HEDNO, a PPC subsidiary, is finalized.

PPC’s net debt was at 5 billion euros in 2014 and could plunge well below the three billion-euro mark as a result of the recent deal with Macquarie, the winning bidder in a DEDDIE/HEDNO tender.

Overall, PPC is expected to post weaker financial results, compared to previous quarters, as a result of escalated prices for CO2 emission rights, fuel and gas, and the company’s market-share contraction. However, these unfavorable factors are believed to have been partially offset by an increase in demand for electricity over recent months.

 

Island grid links result in initial public service savings for 2022

The public service compensation (YKO) special account, subsidizing higher-cost electricity generation on non-interconnected islands as well electricity costs for low-income households, is expected to end the year with a modest surplus, July’s launch of the Crete-Peloponnese grid interconnection being a key factor, paving the way, in 2022, for reductions of YKO surcharges included in electricity bills, energypress sources have informed.

A precise figure on the extent of the YKO special account surplus for 2021 is expected in October, when the distribution network operator, DEDDIE/HEDNO, managing this account, submits a related report to RAE, the Regulatory Authority for Energy.

As is the case each year, the report will include financial details on the YKO special account for the current year’s first ten-month period as well as the operator’s projections for the final two months.

YKO savings resulting from the Crete-Peloponnese grid interconnection are worth approximately one million euros per day, the overall benefit in 2022 estimated at 380 million euros, power grid operator IPTO informed.

The end of the energy isolation of the Cyclades islands Syros, Paros, Tinos, Mykonos and Naxos has led to YKO savings of approximately 70 million euros per day, IPTO officials added.

Public service compensation account savings are expected to nearly double by 2024, when the fourth phase of the Cyclades grid interconnection is expected to be completed and the Crete-Athens interconnection is scheduled to be launched.

Further ahead, towards the end of the decade, this account’s outlay will be subdued even more when interconnections in the Dodecanese and North Aegean are scheduled to be completed.

 

Energy privatizations exceed forecasts, raising nearly €3bn

Two major energy-sector privatizations whose bidding procedures were completed last week, the 100 percent sale of gas company DEPA Infrastructure and 49 percent sale of electricity distribution network operator DEDDIE/HEDNO, exceeded even the most optimistic of expectations, resulting in total revenue, from both sales, of 2.849 billion euros, well over initial projections of 2.2 billion euros.

Australian fund Macquarie’s 2.116 billion-euro winning offer for 49 percent of DEDDIE/HEDNO, being offered without managerial control, stands as a record sum for Greek privatizations.

The DEDDIE/HEDNO sale’s amount will be used by power utility PPC, the parent company, for network modernization, RES growth, and improved customer services.

Italy’s Italgas secured 100 percent of DEPA Infrastructure with an improved follow-up offer of 733 million euros. Thus sum is expected to exceed 800 million euros once the buyer’s bid for a 49 percent stake in distributor EDA THESS, covering the Thessaloniki and Thessaly areas, is submitted and added to the tally.

According to the DEPA Infrastructure sale’s terms, the winning bidder must also purchase EDA THESS’s 49 percent stake, held by Italy’s Eni gas e Luce, wanting to sell.

The favorable outcomes of the two privatizations highlight the country’s improving investment climate as well as the confidence of foreign institutional and strategic investors in the prospects of the Greek economy, Prime Minister Kyriakos Mitsotakis noted. This improvement is also confirmed by yet another upgrade of the Greek economy, this time by Scope Rating, he added.

Besides signaling good news for the Greek economy, the DEDDIE/HEDNO and DEPA Infrastructure privatizations also send an upbeat message on the prospects of the domestic energy market.

 

Big week for energy privatizations, approaching finales

It is a big week for the country’s energy privatizations with gas company DEPA Infrastructure’s tender set to reach a concluding stage tomorrow and that of distribution network operator DEDDIE/HEDNO also approaching its finale as its binding bids are scheduled to be opened on Friday.

Italgas, Italy’s biggest natural gas distribution company and the third largest in Europe, has, according to sources, submitted the highest bid in the DEPA Infrastructure sale, offering an 100 percent stake, and is the only bidder to which the privatization fund TAIPED has extended a request for an improved offer, by tomorrow.

The Italgas offer is believed to be close to 700 million euros, a figure expected to rise further, and well above an offer submitted by rival bidder EPH from the Czech Republic.

As for the privatization of DEDDIE/HEDNO, a power utility PPC subsidiary, four binding offers, for a 49% stake, have been submitted by major international funds CVC Capital Partners Group, First Sentier Investors Group, KKR Group, and the Macquarie Group. This level of participation could boost bid levels. Offers of over 1.5 billion euros, or even 1.7 billion euros, could be unveiled, sources have anticipated.

The rebounding economy, potential of Greece’s energy market, as well as the statures of all five suitors involved in the two sales could result in two of the country’s most lucrative privatization agreements, in all sectors.

Binding bids for HEDNO today, PPC sets ambitious target price

The sale of a 49 percent stake in power utility PPC’s subsidiary DEDDIE/HEDNO, the distribution network operator, has reached the final stretch with at least three bidders in contention as the binding-bids deadline expires today.

US fund CVC Capital, as well as Australia’s Macquarie and First Sentier, are believed to be in the running, while the participation of KKR (Kohlberg Kravis Roberts & Co. L.P.) remains probable.

PPC’s administration is not expected to accept anything less than 1.5 billion euros for the subsidiary’s 49 percent, a price expectation based on DEDDIE/HEDNO’s book value, estimated at 3 billion euros.

The operator’s regulated earnings for 2021 to 2024 begin at 771 million euros and reach 798 million euros in 2024.

The financial offers by bidders are not expected to be opened today but will remain under wraps until all other details (legal, technical) of the offers have been fully examined.

Once the binding bids have been submitted, PPC will call an extraordinary general shareholders’ meeting for the sale’s approval. PPC’s objective is to have completed this partial privatization by the end of the year.

 

Longer wait for small-scale PV investors in desaturated areas

Investors behind new small-scale PV units planned for Crete, the Peloponnese, Evia and the Cyclades, now desaturated following recent measures, will need to wait until around November, at least, to submit applications for connection terms as a pending ministerial decision needed for the launch of a DEDDIE/HEDNO distribution network operator platform accepting applications is not expected any sooner than October, energypress sources have informed.

As a result, investors behind small-scale PV units planned for Crete, the Peloponnese, Evia and the Cyclades, areas where RES capacity has become available following a legislative revision ratified in July, will need to wait for a longer period than had been originally announced.

Besides launching the applications platform, the pending ministerial decision will also provide details on letters of guarantee to accompany applications, as well as any other information or supporting documents.

July’s legislative revision made available 86 MW in the Peloponnese, 45 MW in the Cyclades, including 15 MW for net metering, 40 MW in Evia, and 140 MW in Crete, including 40 MW for net metering.

Maximum capacity levels of 400 KW have been set for PV units in these areas, except for Evia, where the limit is 1 MW.

These projects will secure tariffs based on an official price catalogue for non-competitive procedures. The energy ministry does not plan to make any revisions to this price list in the near future, meaning small-scale PVs that are operating or have declared a readiness to operate between March 1, 2022 and December 31, 2022, will secure feed-in tariffs at 63 euros per MWh.

HEDNO bids confirmed Friday, sale price of over €1.7bn seen

Just three days remain before claims, for some time now, concerning binding bids from three major funds in the 49 percent sale of distribution network operator DEDDIE/HEDNO can be confirmed.

US fund CVC Capital, as well as Australia’s Macquarie and First Sentier, are all believed to have submitted binding bids, while the participation of KKR (Kohlberg Kravis Roberts & Co. L.P.) remains uncertain. All will be confirmed this Friday.

More crucially, the bids will reveal whether the sale of DEDDIE/HEDNO’s 49 percent stake can exceed a price of 1.7 billion euros, as contended by bank and financing sources.

If these market projections are confirmed, the sale will be considered a resounding success as the DEDDIE/HEDNO stake will be sold at 1.18 times its Regulatory Asset Base (RAB).

According to a latest DEDDIE/HEDNO evaluation, assisted by professional services provider Grant Thornton, the operator’s total value is worth 2.95 billion euros.

 

IPTO, now in control of Crete’s small-scale link, boosts to full capacity

Power grid operator IPTO, which has assumed control of a small-scale power grid interconnection linking Crete with the Peloponnese following the transfer, to IPTO, of distribution network operator DEDDIE/HEDNO’s assets on Crete, effective August 1, has, since August 26, also increased the line to near full capacity, at 150 MW, sources informed.

In addition, IPTO yesterday successfully staged a trial run further boosting the line’s capacity to 180 MW, the absolute upper limit.

The Crete-Peloponnese grid link was launched on July 3 to transfer power loads from the mainland to Crete in order to prevent energy insufficiency issues on the island.

Between its first day and August 20, the link consistently supplied Crete at a capacity of between 70 and 80 MW. This transmission was boosted to 100 MW between August 20 and 25 ahead of the latest increases over the past few days.

Crete’s participation in target model markets will be based on a hybrid model proposed by the Hellenic Energy Exchange from October 1 until the island’s large-scale grid link with Athens is completed.

 

HEDNO executive bonuses excluded from operating costs

RAE, the Regulatory Authority for Energy, has forbidden the operating-expense inclusion of bonus amounts offered by distribution network operator DEDDIE/HEDNO to its executives, a decision reached through the authority’s approval of the operator’s allowed regulatory income for 2021 to 2024 and required revenue for 2021.

The bonus amounts set aside by the operator for executives are worth a total of one million euros, for one year.

RAE rejected the inclusion of this amount in HEDNO’s operating expenses by pointing out that bonus payments for executives do not offer any benefits to users of the distribution network.

HEDNO to use electricity theft reserve sum for operating costs

Distribution network operator DEDDIE/HEDNO is expected to cover some of its operating costs using electricity theft reserve money, following a decision by RAE, the Regulatory Authority for Energy, approving the operator’s allowed regulatory income for 2021 to 2024.

The electricity theft reserve money to be used by the operator totals 10.04 million euros.

RAE considers appropriate the allocation of this amount for partial coverage of DEDDIE/HEDNO’s allowed regulatory income as the operator has not indicated it would utilize the sum for other matters.

According to provisions in network management rules, amounts collected in the electricity theft reserve may, following RAE approval, be used to offset financial losses of consumers as a result of network electricity theft, as long as there is no immediate need, or specific proposals by the network operator, to finance actions intended to improve electricity theft detection and limit such practices.

Smart meter installations to combat rising electricity theft

The replacement of conventional power meters around the country with digital power meters planned by distribution network operator DEDDIE/HEDNO, a long-awaited project now scheduled to commence in 2022 and be completed by 2030, will reduce electricity theft by an average of 5.1 percent per year between 2020 and 2031, eventually reducing it to 0.2 percent of overall consumption, a level registered in 2003 and 2004, RAE, the Regulatory Authority for Energy has projected.

Electricity theft in Greece has risen twentyfold over the past fifteen years. Even though DEDDIE/HEDNO has pointed out that the pandemic-induced economic slowdown since 2020 will raise obstacles in the effort to reduce electricity theft, RAE insists the installation of smart meters will directly combat the problem by enabling officials to swiftly identify where electricity theft is being committed.

Electricity theft in Greece has risen from 0.2 percent of overall consumption in 2003 and 2004, to 1.1 percent between 2011 and 2013, 3.9 percent in 2015 and 2016, and 4.4 percent in 2018 and 2019, official data has shown.

 

Operator network boost for 1,750 MW in new RES entries

Distribution network operator DEDDIE/HEDNO will use Recovery and Resilience Facility (RRF) funds to cover a considerable proportion of an investment for capacity boosts at certain existing low and medium-voltage substations around the country to facilitate the entry of new RES units.

The capacity boost at these substations, it is estimated, will enable grid entry for new RES units with a total capacity of approximately 1,755 MW.

This prospective RES addition represents nearly 40 percent of the 4,640 MW in new RES unit entries planned for the achievement of National Energy and Climate Plan (NECP) RES penetration goals.

This DEDDIE/HEDNO investment will cost close to 30 million euros, of which 12 million euros will stem from the RRF.

Substations in the Peloponnese and Epirus, northwestern Greece, will be boosted by 250 MVA. Substations in the wider Athens area will be boosted by 100 MVA, such facilities in central Greece will be boosted by 200 MVA, and Macedonia and Thrace units in the north will be boosted by 250 MVA.

All project contracts are expected to have been finalized by the fourth quarter of 2023, while the projects are scheduled to be completed by the fourth quarter of 2025.

 

Distribution network operator upgrading channels of communication

Distribution network operator DEDDIE/HEDNO received 32,471 documents concerning enquiries and complaints in 2020, the operator has informed Parliament.

Of these documents, 26,237 (80.8%) were enquiries; 5,354 (16.49%) were complaints; 251 (0.77%) complaints about voltage quality; and 629 (1.94%) complaints beyond HEDNO’s realm of responsibility.

As part of its effort to upgrade customer services, HEDNO has modernized its channels of communication through online systems.

 

Fast-track procedures in place for power line undergrounding

The energy ministry, striving to replace overhead power lines with underground networks for the infrastructure’s protection following recent fire-related damages, preceded by snowstorm damages last winter, has taken measures to clear the way of any possible bureaucratic delays and is also seeking to secure additional funds for the undergrounding work.

Legislative revisions recently ratified in Parliament include a measure facilitating fast-track power line undergrounding by operators through forest land without them having to wait for approval from forestry officials, which has been customary practice.

As a result, distribution network operator DEDDIE/HEDNO and power grid operator IPTO can now proceed with power line undergrounding projects without delay or cancellation risks. This applies for both new power line networks and replacement of older ones.

The country has, at its disposal, EU Recovery and Resilience Facility (RRF) money totaling 187 million euros for power line projects.

However, given the average cost of power line network undergrounding, estimated at 85,000 euros per kilometer, the aforementioned RRF amount would suffice for the development of about 2,200 kilometers, just a tiny fraction of the country’s existing overhead power lines.

Besides the RRF, the energy ministry is also considering to exhaust funding support possibilities through the National Strategic Reference Framework (NSRF) for the power line undergrounding expansion projects, now regarded as essential due to the growing impact of the climate change crisis.

Grid saturation forcing operator to block RES term applications

The grid’s medium-voltage capacity has reached its limit in many parts of the country, according to related information published by DEDDIE/HEDNO, the distribution network operator, forcing it to reject the overwhelming majority of new RES project connection-term applications.

Medium-voltage grid capacity is currently fully saturated in areas covering 40 percent of the country, including western Macedonia, in the country’s north, a lignite-dependent area planned for decarbonization.

RES connection-term applications in these areas lacking grid capacity are all being rejected. In other parts of the country, where limited grid capacity remains available, nine in ten RES applications are being rejected by DEDDIE/HEDNO, creating issues for prospective investors.

The problem primarily concerns smaller-scale RES investment plans not possessing the capacity to connect to the grid via IPTO, the power grid operator.

The saturation problem’s extent is even preventing the installation of roof-mounted solar panels in some parts of the country, according to one source.

The subdued potential, at present, of the latest Saving at Home program offering subsidies for energy efficiency upgrades at properties has been partially attributed to the grid’s lack of capacity for new RES installations.

 

NSRF possibilities considered for power line undergrounding

Energy ministry officials intend to examine National Strategic Reference Framework (NSRF) funding possibilities for power line network undergrounding, triple the cost of overhead power lines, following the recent destructive fires around the country.

The country has specific EU Recovery and Resilience Facility (RRF) money, totaling 187 million euros, at its disposal for power line projects.

Given the average cost for power line network undergrounding, at 85,000 euros per kilometer, factoring in low and medium-voltage prices, the aforementioned RRF amount would be enough to develop about 2,200 kilometers, just a tiny fraction of distribution network operator DEDDIE/HEDNO’s total network. Undergrounding the country’s entire network would require an estimated 18.3 billion euros.

The high cost has limited the country’s power line undergrounding plans for the next five years to approximately 2,150 kilometers.

The operator has already undergrounded 10 percent of its 240,000-kilometer network, leaving a further 216,000 kilometers for potential undergrounding.

Overhead medium-voltage power line development costs approximately 30,000 euros per kilometer. Overhead low-voltage lines cost 25,000 euros per kilometer, compared to 70,000 euros for undergrounding.

Given the increased threat of forest fires brought about by hotter temperatures attributed to the climate change crisis, power line network undergrounding would provide protection to the network.

Network damages estimated at €25m, operator well stocked

Damages to electricity infrastructure caused by extensive fires in various parts of the country have, according to an initial estimate, reached between 20 and 25 million euros, but the cost could rise as fires are still burning in northern Evia, one of the hardest hit areas, sources at DEDDIE/HEDNO, the distribution network operator, have noted.

The estimate includes sub-stations, utility poles and power lines. The operator is stocked with all the equipment needed to replace damaged infrastructure, the sources added.

The operator has been stocking up over the past year and a half, covering any equipment shortages, according to the sources.

Even so, the cost of the fire-related damages is not negligible. It represents approximately 14 percent of last year’s total investments at DEDDIE/HEDNO, which reached 175 million euros.

Up until Saturday, 2,150 utility poles, 120 sub-stations and 109 kilometers of low and medium-voltage power lines in the wider Athens area, Evia and the Peloponnese were reported to have been damaged, but these figures are expected to increase.

Grid faces new challenge today as heatwave persists

The country’s grid stands to face yet another major challenge today as electricity demand could climb to a new record level, driven up by the sustained heatwave conditions, projected to reach levels of between 40 and 42 degrees Celsius.

Power grid operator IPTO projects electricity demand will reach 10,835 MW, which would be a new all-time high, following yesterday’s level of 10,662 MW.

Natural gas-fired power stations operated by power utility PPC and independent producers will once again contribute dominantly, exceeding 43 percent, according to energy exchange data.

PPC’s combined-cycle Lavrio IV will return to action today following the replacement of technical components at the unit, according to IPTO’s schedule for the day.

The overall input of renewable energy units is expected to rise marginally today, compared to previous days, and cover 16.5 percent of demand.

Electricity imports are also expected to cover 16.5 percent of demand today.

Lignite-fired power stations, including Megalopoli IV, back following repairs, are expected to represent 14.46 percent of the energy mix.

Major-scale hydropower facilities should cover a little over 9 percent of electricity demand.

The government’s crisis management team expects generation will reach required levels and, furthermore, could be boosted by greater output at wind-energy facilities as a result of stronger winds that have been forecast for today.

On the other hand, the prospect of stronger winds is unfavorable for firefighters seeking to subdue a number of fire fronts. Also, the risk of new fires is also higher. In such an event, the grid, under extreme pressure over the past ten days amid the sustained heatwave, would surely suffer further damages.

Distribution network operator DEDDIE/HEDNO crews are continuing efforts to restore power supply in fire-hit Varybobi, north of Athens. The northern section of Evia, northeast of Athens, and Pyrgos, northwest Peloponnese, have also been affected by power supply cuts as a result of fires in the regions.

Operator on standby to restart old power stations on Cyclades

Authorities taking part in a national energy control center emergency meeting yesterday placed the Cyclades islands on red alert as electricity supply to the region was threatened by an extensive fire that broke out in Varybobi, north of Athens.

Power supply to Syros, Paros, Naxos, Mykonos, Tinos and Andros was pressured by the Varybobi fire as these islands are linked to the mainland grid via a subsea cable beginning from coastal Lavrio, southeast of Athens.

The Varybobi fire burnt late into the night but is now reported to have been brought under control by firefighters as four of five fronts have been extinguished. At least 80 houses are reported to have been burnt in the fire. No human casualties have been reported.

The fire-related collapse of two of three key power lines brought the Cyclades, as well as Athens, to the brink of an extensive power outage. Tourism activity is currently high in the Cyclades.

Officials at yesterday’s national energy control center emergency meeting decided to send distribution network operator DEDDIE/HEDNO technicians out to Syros, Paros, Mykonos and Andros, ordering them to restart local diesel-fired power units if supply from Athens is cut.

These units have been sidelined as a result of the subsea cable connections developed to link the islands with the mainland grid.

Late in June, RAE, the Regulatory Authority for Energy, taking into account the extreme weather conditions, grid pressure, as well as the large number of tourists on the islands, had approved a DEDDIE/HEDNO application for the installation of a generator on Santorini for additional generation in case the existing facility on the island falls short of electricity demand. DEDDIE/HEDNO had estimated a possible 8-MW deficit.

 

Non-auction PV, wind unit exceptions over at end of ’22

A recent measure enabling small-scale PV installations of up to 500 KW without competitive procedures for tariffs, under the condition that applicants do not already possess two projects of such technology, has sparked renewed activity in the sector around the country with thousands mobilizing.

However, for a full picture, this development needs to be combined with the fact that the measure represents a temporary window of opportunity for small-scale producers that will slam shut at the end of 2022.

According to official policy, as of January 1, 2023, RES units will only be eligible for operational contracts with DAPEEP, the RES market operator, if they have participated in competitive procedures.

This essentially means that old 500-KW PVs, wind energy turbines of up to 3 MW and equivalent facilities of energy communities, plus new RES units will need to have established contracts with DAPEEP by the end of 2022.

Though this represents ample time from a technical perspective, investors typically face big delays for connection term offers from DEDDIE/HEDNO, the distribution network operator. In most parts of the country, the operator’s examination of applications and eventual response takes several months.

Even more crucial for investors seeking to develop RES facilities without going to auction is the fact that the majority of DEDDIE/HEDNO responses are negative as network capacity availability is limited.

Applications for non-auction PVs will be submitted to an online platform planned to be developed by DEDDIE/HEDNO. First-come, first-served qualification criteria will be applied.

 

 

Energy minister calls emergency meeting, heatwave set to peak

Energy minister Kostas Skrekas is due to visit power grid operator IPTO’s control center in Athens today for an emergency meeting he has ordered to deal with grid sufficiency issues raised by the prolonged heatwave conditions, expected to become even more acute during the week.

Prime Minister Kyriakos Mitsotakis will participate in the emergency meeting along with the head officials of RAE, the Regulatory Authority of Energy, power grid operator IPTO, distribution network operator DEDDIE/HEDNO, and power utility PPC.

The grid is expected to face unprecedented conditions in coming days as electricity demand peaks to reach record levels, prompted by the extreme weather conditions.

The energy ministry has already urged the public to exercise restraint in electricity consumption over the next few days as a means of helping the pressured grid cope with the heatwave’s demands.

The energy minister also staged an emergency meeting yesterday morning with officials of the aforementioned energy sector companies.

Electricity demand today is expected to peak at 9,600 MW, at around 9pm, well over the average peak of 8,115 MW in the first half of 2021.

HEDNO’s Crete assets set for transfer to IPTO

An energy ministry legislative revision facilitating the transfer to power grid operator IPTO of distribution network operator DEDDIE/HEDNO’s assets on Crete, a pending issue needed for the launch of market activity concerning the island’s small-scale interconnection with the Peloponnese, has been submitted to Parliament for ratification, ending months of debate on the matter.

As of August 1, Crete’s entire package of high-voltage electricity grid assets will be transferred from power utility PPC, DEDDIE/HEDNO’s parent company, to IPTO, the new owner of these assets, taking on their operational management.

Until now, DEDDIE/HEDNO has been responsible for the management of Crete’s small-scale interconnection with the Peloponnese.

The price IPTO will need to pay for the acquisition of these Cretan grid assets will be determined by their market value, to be calculated over two stages.

The first will reflect the regulatory value of the assets. The second, to be calculated at a latter date, will concern the evaluation of the assets transferred to IPTO by an independent, specialized appraiser to be accepted by both IPTO and PPC.

 

Ministry bill for small-scale PVs without competition procedure

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

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

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

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

RES investors in rush to avoid €35,000/MWh guarantee cost

Thousands of RES investors already holding producer certificates are racing against time to avoid letter-of-guarantee payments of 35,000 euros per MW, which will be avoided if they manage to submit complete applications for finalized connection offers by a February 28, 2022 deadline to distribution network operator DEDDIE/HEDNO or power grid operator IPTO.

This same deadline applies for imminent producer certificates to be issued through last month’s application cycle. RAE, the Regulatory Authority for Energy, has already begun processing these applications submitted in June. If these investors miss the February deadline for finalized connection offers, they too will also face letter of guarantee costs.

From the next cycle – in October – onwards, most applicants will need to submit letters of guarantee worth 35,000 euros per MW. Investors behind smaller projects with capacities of less than 1 MW, strategic investments, projects for public-benefit purposes, as well as projects developed by local authorities and foundations, will be exempted from the upcoming letter of guarantee requirement.

Its prospect is expected to increase the pressure on DEDDIE/HEDNO and IPTO, expected to face an increased inflow of applications over the next few months as investors scramble to meet the February 28 deadline.

The 35,000-euro per MWh letter of guarantee is being introduced to prevent saturation caused by applicants submitting bids but not following up with actual project development.

Tender relaunch for €1.6bn nationwide distribution network upgrade

Distribution network operator DEDDIE/HEDNO has relaunched a mammoth tender worth a total of 1.6 billion euros for the reinforcement and upgrade of the distribution network throughout Greece over a five-year period.

The tender was initially announced several months earlier but then withdrawn to take into account and adopt certain observations made by interested parties.

The relaunched tender concerns 37 contracts around Greece, 8 of these in the wider Athens area, 9 in the Macedonia-Thrace region, 7 in the Peloponnese and Epirus, 6 in central Greece and 7 at island locations.

DEDDIE/HEDNO aims to reinforce the distribution network for its role in the energy transition, while also protecting it against extreme weather conditions.

New wave of 100-KW solar farms planned for 4 regions

Energy minister Kostas Skrekas has announced a legislative plan to facilitate a new generation of small-scale solar energy farms of up to 100 KW in Crete, the Peloponnese, Evia and the Cyclades, which, through a new platform, would offer investors non-auction tariffs at relatively higher levels than existing tariffs for bigger projects.

Higher tariffs would be offered to investors as this smaller-scale solar parks face increased development costs, the minister noted.

The platform for applications concerning this new category could be ready to operate in October, a month beyond an initial intention, to give distribution network operator DEDDIE/HEDNO, its developer, and interested parties more time to prepare, the minister indicated.

Once ratified, the legislative revision will offer an 86-MW solar capacity for the Peloponnese, 45 MW in the Cyclades, 15 MW of which will be reserved for net metering, 40 MW for Evia and 140 MW for Crete, 40 MW of which will be for net metering.