DG Comp motives for restart of older PPC probe unclear

The European Commission has brought back to the fore a Directorate-General for Competition investigation of power utility PPC and power grid operator DEDDIE/HEDNO over market dominance abuse, despite major market changes that have taken place since 2017, when the probe began.

The direction the investigation’s restart remains unknown. Negotiations between Greece and Brussels for new mechanisms being negotiated could be impacted, some pundits suspect.

Also, the government and state-controlled PPC are currently seeking compensation for the power utility’s need to keep lignite-fired power stations and related mines operational for grid sufficiency needs.

No findings of the investigation’s first round have been released. The probe included raids by DG Comp officials, both local and Brussels-based, of the PPC and IPTO headquarters in Athens that lasted several hours, resulting in confiscations of USB flash drives, documents and hard drives.

PPC’s then-administration, in an announcement at the time, informed that the raid concerned a check on the utility’s “supposed” abuse of market dominance in the wholesale market for electrical energy produced from 2010 onwards.

Prior to the investigation, Brussels suspected levels of the wholesale electricity price – known as the System Marginal Price (SMP), at the time – were being manipulated by PPC through its lignite and hydropower facilities.

In 2017, PPC held an 87 percent share of the retail electricity market and 57 percent of overall electricity generation, now down to approximately 67 and 39 percent, respectively.

Four years ago, PPC’s lignite facilities still dominated the corporation’s portfolio and the energy exchange and new target model wholesale markets did not exist.

The current market setting bears little resemblance to back then. Lignite has regressed into an unwanted, loss-incurring energy source that is being phased out by PPC until 2023, while the energy market is undergoing drastic transformation, as was acknowledged by the European Commission Vice-President Margrethe Vestager, also Brussels’ Commissioner for Competition, in an announcement yesterday.

 

Electricity demand falls 9.5% in January amid stricter lockdown

Stricter lockdown measures in January and their impact on business activity prompted a big reduction in electricity demand, down 9.5 percent compared to the equivalent month a year earlier, when lockdown measures had yet to be imposed, according to power grid operator IPTO’s monthly report.

Most of the country’s retailers were forced to disrupt their business activities in January following a period of less stringent retail measures in the form of a click-away service, enabling customers to pre-order and pick up goods from shops by appointment or, this measure’s extension, click-in-shop, permitting customers to enter stores, see and even try products by appointment.

Electricity demand in the high-voltage category was down by 3.3 percent in January compared to the same month a year earlier, the IPTO data showed.

Interestingly, despite the plunge in electricity demand, electricity production increased by 12.9 percent in January, hydropower being the biggest mover with a 221 percent increase, following power utility PPC’s decision to use its hydropower units as a result of elevated water reserves.

The domestic production increase was attributed to a fall in electricity imports and rise in electricity exports, the greatest quantity going to Italy (43%), followed by North Macedonia (24%), Bulgaria (22%), Albania (9%) and Turkey (2%).

RES output was higher by 43 percent in January as a result of strong winds during the month, while, on the contrary, lignite-fired generation fell 43 percent. Natural gas-fueled power station output was also down, marginally, by 2 percent.

In terms of energy mix share, natural gas-fueled power stations held a 36 percent share, RES units captured 35 percent, hydropower’s contribution represented 16 percent, and lignite was responsible for 13 percent of total electricity generation in January, the IPTO figures showed.

PPC covered 66.6 percent of electricity demand in January, followed by Mytilineos (7.52%), Heron (5.89%), Elpedison (4.63%), NRG (3.49%) and Watt & Volt (2.74%).

RES producer certificate applications wave sustained

The increased wave of RES producer certificate applications submitted of late continued with February’s round, attracting 477 applications representing a total of 8.8 GW, energypress sources have informed. This latest round’s deadline expired on February 10.

Applications for solar energy projects were dominant, both numerically and in terms of capacity, totaling 226 applications and 6 GW, respectively.

A total of 167 applications representing 2.65 GW were submitted for wind energy projects.

The remainder of applications concerned a variety of other RES technologies such as small-scale hydropower plants, combined cooling, heat and power (CCHP) facilities, as well as biogas-biomass units.

The supervising body, RAE, the Regulatory Authority for Energy, is soon expected to begin processing applications submitted for the preceding December round and complete this procedure by late March or early April.

Successful applicants of the December round will then be requested to pay required fees for their producer certificates.

A total of 864 applications representing a capacity of 45.55 GW were lodged by prospective investors for the December round.

PM to visit stalled Mesohora dam project, completion ‘near’

Prime Minister Kyriakos Mitsotakis and his energy minister Kostas Skrekas are scheduled to visit power utility PPC’s slow-moving Mesohora hydropower project in west Thessaly on Saturday as part of a wider visit to the area, for an update on its progress.

The Mesohora dam, along with the E 65 highway project in central Greece, will be the main topics of discussion at meetings, a few hours later in Trikala, between the PM, energy minister and regional authorities.

The Mesohora dam, close to completion since 2001, has been delayed by a series of setbacks, including, most recently, November’s nullification of the project’s environmental terms by the Council of State, Greece’s Supreme Administrative Court.

PPC is being deprived of revenue worth 30 million euros annually as a result of the project’s delay.

Efforts now being made to put the project’s completion back on track include PPC’s ongoing preparation of a new environmental impact study, which should pave the way for the dam’s new environmental terms.

The project’s new environmental license could be a swift procedure, enabling a restart of work for completion and trial tests of the new dam by the end of 2023, according to the most optimistic of forecasts.

The Mesohora hydropower facility, an investment exceeding 400 million euros, is designed to have a 160-MW capacity and produce eco-friendly electricity amounts of 360 GWh, annually.

PPC scouring southeast Europe markets for opportunities

Power utility PPC, on a mission, in recent months, to seek investment opportunities in neighboring countries, is carefully planning its first expedition abroad after some time.

Although PPC’s new three-year business plan does not specifically reference investment plans abroad, the company’s interest in other markets has become apparent.

PPC is striving to become a modern corporation and market leader in southeast Europe by 2030, the power utility’s chief executive Giorgos Stassis told a Bloomberg event late last week.

Potential projects on the corporation’s radar include North Macedonia’s Cebren hydropower facility, a 500-600 million-euro project for which PPC has entered a tender with Archirodon as its partner, and, further ahead, RES investments.

Establishing oneself as a dominant player in the southeast European market is a major challenge as highlighted by the participation of ten consortiums, big names included, in the Cebren hydropower plant tender, the latest following a total of ten preceding procedures for this project, all fruitless.

A proportion of PPC’s 1.1 billion-euro EBITDA target for 2023 could be generated by business activities beyond Greece.

The power utility has assembled a working group tasked with scouring foreign-market opportunities in all sectors, including hydropower, photovoltaics, other RES technologies, project tenders, as well as acquisitions.

PPC has made a series of unsuccessful investment quests over the past 18 years, beginning with Romania’s privatization tender, in 2003, for electricity distributors Electrica Banat and Electrica Dabrogea. PPC had advanced to this procedure’s second round but ultimately lost to Italian powerhouse Enel.

PPC bids for North Macedonia’s Cebren hydropower plant

Power utility PPC is among ten international bidding teams from the energy and construction domains that have submitted pre-qualification offers to a tender for North Macedonia’s prospective Cebren hydropower plant, an investment expected to require at least 500 to 600 million euros.

This preliminary stage of the tender concerns water usage licensing rights for hydropower output at the neighboring country’s Crna Reka river. Preliminary bids were opened yesterday.

A related committee to soon be assembled by the North Macedonian government will examine whether the bids submitted fully meet the tender’s requirements before qualifiers are invited to a second round for offers concerning the project’s development in a Public Private Partnership (PPP) with state-owned power producer ESM.

Besides PPC, which has teamed up with energy and construction firm Archirodon, the other nine bids were submitted by: EVN-Verbund (Austria); Gezhouba Group China (China); Power Construction Corporation of China (China); EDF (France); Eiffage-Waterlu-Andritz-Norconsult (France, Austria); Webuild SPA Italia-Salini (Italy); Cobra-Cobra Hidraulika (Spain); ENKA-COLIN (Turkey); and Ozaltin-Yapi Merkezi (Turkey).

The North Macedonian government plans to commission a consultant for preparations concerning the tender’s second round.

In previous years, more than ten tenders have been staged for the construction and operation of the Cebren hydropower plant, but all efforts have proved fruitless, for a variety of reasons.

Prime Minister Zoran Zaev’s administration has noted that a serious effort is being made for the project’s development, ascertaining the current tender will be successfully completed.

It is planned to offer an installed capacity of between 333 and 458 MW for annual electricity production of 1,000 to 1,200 GWh.

Natural gas-fueled generation reaches energy-mix record share of 56.64%

The energy mix contribution of natural gas increased to a record-level share of 56.64 percent in October, a latest energy exchange monthly report has shown.

This significant rise in the energy-mix share of natural gas – to a level never before reported since the full liberalization of Greece’s electricity market – has been attributed to a major slowdown of power utility PPC’s lignite-based generation.

Natural gas-fueled power stations operated by power utility PPC and independent producers further consolidated their place in the energy mix standings, stretching further ahead of other fuel categories.

October’s 56.64 percent energy-mix share captured by natural gas broke this fuel’s previous record of 53.76 percent, registered in August. The natural gas energy-mix share had dipped slightly to 51.74 percent in September before rebounding for October’s record-breaking result.

A year earlier, the natural gas energy mix share was below 50 percent, at 49.86 percent, while lignite’s share was at approximately 22 percent.

Returning to the latest energy-mix figures, natural gas was followed by the RES sector, capturing 33.86 percent, lignite’s share shrunk further to 4.25 percent, and hydropower followed with a 3.21 percent share.

PPC’s lignite-based generation could rise slightly in coming months to cover telethermal needs.

The role of natural gas in the ongoing energy transition towards renewable energy dominance is expected to play a pivotal role for the grid’s sufficiency and security.

Balkan hydropower projects focus of Sarajevo event in November

Τhe prospects and development strategies of the hydropower industry in the Balkan region will be further discussed at the 4th International Summit and Exhibition “Hydropower Balkans”, scheduled to take place November 4-5, 2020 in Sarajevo, Bosnia and Herzegovina.

In the lead-up, organizers have prepared a report on the results of a study focused on the development of hydropower projects in the Balkans.

This report provides:

  • An overview of the hydropower industry in the Balkans per country;
  • A list of the most promising hydropower projects to be developed until 2025 in the Balkan region per country;
  • 120+ experts survey results with key information about Balkans hydropower industry prospects in the upcoming 10 years.

Request the report : https://www.hydropowerbalkans.com/analytics-report-on-current-industry-conditions/

Strategic Partners 2020: Elektroprivreda Republike Srpske (ERS), Elektroprivreda BiH

Balkan hydropower summit planned for November in Bosnia and Herzegovina

The 4th Annual International Summit and Exhibition Hydropower Balkans 2020 is scheduled to take place November 4 and 5 in Sarajevo, Bosnia and Herzegovina.

In the lead-up, organizers of the event have prepared a related report listing all key HPP construction and modernization projects planned to be launched in the Balkan region between 2020 and 2025.

Projects featured in the report include:

  • Čebren HPP in North Macedonia, a 333-MW construction project in North Macedonia whose investment needs are budgeted at 570 million euros.
  • HPP Komarnica construction in Montenegro. EPCG has signed an agreement to produce a preliminary design plan for this construction project, an investment estimated to be worth 237.9 million euros.
  • Dabar HPP construction in Republika Srpske, one of the two entities of Boznia and Herzegovina. Hidroelektrana Dabar, a unit of Elektroprivreda Republika Srpske, issued a public call for financing and building of HPP Dabar, a turnkey/engineering project valued at some 200 million euros.
  • HPPS Foča and Paunci construction, a plan by Republika Srpska and Serbia plan to jointly build two HPPs with a combined installed capacity of between 90 MW and 95 MW. This investment is estimated at 200 million euros.
  • HPP Buk Bijela construction. Serbia and Republika Srpska intend to jointly build the Buk Bijela hydropower plant, a project requiring an investment of 193 million euros.

Requests for the full list of investment projects may be submitted to: https://www.hydropowerbalkans.com/request-the-full-list-of-investment-projects/

MH Elektroprivreda Republike Srpske and JP Elektroprivreda BiH are the November event’s strategic partners.

Gas, renewables cover 76% of electricity demand in June

Natural gas and renewable energy sources covered 76 percent of electricity demand in June, limiting lignite’s contribution to a mere 5 percent, latest figures provided by power grid operator IPTO have shown.

The development highlights the fast-approaching end of the lignite era in Greece, currently in transition towards green energy.

Natural gas-fueled generation in June covered 37 percent of electricity demand, plus 2 percent contributed by cooling, heating and power (CCHP) generation, while renewables contributed 37 percent, including hydropower input of 9 percent.

Highlighting lignite’s severely diminished role in generation, PPC restricted its lignite-fired generation last month by 75 percent compared to the equivalent month a year earlier.

During this same one-year period, renewable energy source generation increased by 7.6 percent, while natural gas-based electricity production was up by a milder 1.2 percent, the IPTO data showed.

In another noteworthy statistic, all of the country’s lignite units were switched off for 40 hours, continuously, for the first time in June.

Low-cost gas driving down wholesale electricity prices

The abundance of low-cost natural gas, enabling electricity producers operating gas-fired power stations to offer extremely competitive prices, is reshaping the wholesale electricity market.

Highlighting this development, the average level of the System Marginal Price, or wholesale electricity price, today, a day of strong demand, is expected to be contained below 40 euros per MWh, at 39.551 €/MWh.

Today’s electricity demand is expected to peak over 8.3 GW with total consumption reaching 168,674 MWh. The wholesale price during the peak hours will not exceed 38.850 €/MWh.

The market conditions for today are not an isolated incident but part of a wider trend that has developed during the week.

Yesterday’s average SMP was just 35.961 €/MWh despite a peak of 8,105 MW and total electricity consumption of 162,777 MWh.

On Wednesday, when demand peaked at 8,072 MW and overall consumption totaled 162,492 MWh, the SMP was 39.243 €/MWh.

The SMP exceeded the 40 €/MWh level just once this week, on Tuesday, reaching 40.689 €/MWh, a day whose peak was below 8000 MW.

The week started with Monday’s SMP average at 39.277 €/MWh, a lower peak of 7,649 MW, and total consumption for the day of 152,716 MWh.

SMP prices have been falling to even lower levels during weekends. Last Sunday, the average SMP was just 30.629 €/MWh with the peak down to 6,370 MW and the day’s consumption at 134,563 MWh.

The grid relied on just one lignite-fired power station, Agios Dimitris III, last Sunday. Demand was primarily covered by gas-fired generation, as well as renewable energy sources, hydropower units and electricity imports.

Power demand dives 14.61% in June as tourism slumps

Electricity demand slumped 14.61 percent in June, compared to a year earlier, despite the month’s lifting of lockdown measures, latest Greek energy exchange figures have shown.

June’s drop in power demand, attributed to the unprecedented decline in tourism activity, was even bigger than the declines registered in April and May, 13 percent and 9 percent, respectively.

Numerous hotels and other tourism industry units have not opened for business. Also, flight bans were essentially not lifted until the beginning of this month.

Responding to the drop in electricity demand, energy producers have restricted output by 16 percent.

Natural gas and renewables dominated electricity generation in June. Natural gas-fueled generation covered 36.56 percent of demand, while RES production covered 26.43 percent, the energy exchange’s June report showed. Electricity imports covered 23.93 percent, hydropower 7.43 percent and lignite-fired production 5.64 percent.

 

 

US wants Greece as partner for pumped storage projects

Recognizing the importance of pumped storage hydropower technology as a means for energy storage, the US is promoting the establishment of a related international forum to bring together countries and companies for co-development of such projects.

According to sources, Greek deputy energy minister Gerassimos Thomas has received an invitation from the US department of energy and the International Hydropower Association requesting Greece’s participation in a US-headed multidisciplinary platform that will seek to reinforce the role of pumped-storage technology in current and future energy systems.

Pumped storage hydropower supply during the pandemic has provided vital energy support for US households, hospitals and schools, American experts have determined.

Washington believes pumped storage hydropower projects are capable of enhancing the reliability of grids and supporting further renewable energy penetration. This technology, regarded as tried and tested, can be further developed in the energy transition era, US experts support.

Pumped storage hydropower currently represents about 94 percent of global energy storage capacity, latest data has shown.

A pumped storage hydropower project planned by Greece’s GEK TERNA in Amfilohia, western Greece, is regarded as a pioneering initiative in Europe.

The country’s energy ministry has approached the European Commission for special funding support for this project, budgeted at over 500 million euros.

 

Grid passes summer’s first test, demand at 7,600 MW today

The country’s grid is set to face increased pressure as temperatures rise throughout the country and are forecast to reach as high as 39 degrees Celsius today. Electricity demand is expected to rise to 7,600 MW.

The country’s grid coped well during yesterday’s first major test for the summer. Electricity demand reached 7,300 MW amid temperatures marginally lower than the levels forecast for today.

The power utility PPC was forced to use its hydropower facilities. Water deposit levels have been extremely low this year. Further usage of the hydropower facilities will be needed today but PPC is expected to act cautiously as it awaits tougher days ahead.

PPC anticipates it may need to use 50 to 60 percent of its 3,171-MW total hydropower capacity in July.

The heat-related rise in electricity demand has coincided with increased wholesale electricity prices over the past week. They rose sharply from 28.62 euros per MWh on June 28 to 44.52 euros per MWh on Tuesday and 45.01 euros per MWh yesterday.

This first summer test for the grid has once again highlighted the extremely high costs entailed in operating lignite-fired power stations. Their generation costs are now between 90 and 100 euros per MWh.

During this heatwave, PPC, currently moving to withdraw most of its lignite units over the next three years, has opted to minimize its reliance on lignite, preferring instead to cover its generation needs through its natural gas units and hydropower stations.

 

 

 

PPC turns to hydropower facilities as temperatures rise

Power utility PPC has turned to its hydropower facilities to meet heightened electricity demand anticipated over the next few days as a result of hot temperatures in many parts of the country.

PPC plans to use hydropower stations during the peak-demand hours of 11am-3pm and 8pm-10-pm, but the input of these facilities is expected to be contained. Water deposit levels have been extremely low this year.

PPC’s hydropower stations, 15 in total, offer a capacity of 3,171 MW.

Temperatures are forecast to reach as high as 38 degrees Celsius in some parts of Greece. These weather conditions will force PPC to resort to its hydropower units.

The power utility may need to provide between 50 and 60 percent of its total hydropower capacity over the next few days.

Hydropower generation was down 24 percent in the first five-month period this year, compared to the equivalent period last year, according to power grid operator IPTO’s monthly report.

Hydropower generation reached 995 GWh between January and May compared to 1,308 GWh during the equivalent period in 2019.

Hydropower facility contributions to the country’s overall generation represented just 6 percent of the total in January, 4 percent in February, 6 percent in March, 7 percent in April and 9 percent in May.

New Peloponnese RES project applications deferred to 2021

Distribution network operator DEDDIE/HEDNO and power grid operator IPTO have written off any possibility of accepting new RES connection applications in 2020 for new solar and wind energy projects, as well as other technologies, but application procedures could recommence in 2021, energypress has been informed.

Authorities face the challenging task of managing an enormous level of RES investment interest, especially for solar energy projects, before procedures for new-project applications can restart.

In the Peloponnese, where RES development has been held back by system saturation for seven years, a new IPTO study is still needed on the capacity to become available once two transmission networks, the west and east corridors, are completed.

Once IPTO has delivered this study, RAE, the Regulatory Authority for Energy, should lift its saturation-related ban on new RES projects in the Peloponnese and also set capacities available for each technology – wind, solar, small-scale hydropower, biomass-biogas.

However, IPTO’s delivery of the west and east corridors in the Peloponnese does not promise a complete solution as these lines, limited to 400-KV capacities, are well below capacities represented by the level of investment interest.

A fair and effective competitive procedure serving as a selection process will need to be established.

Electricity demand down 12.6% in April, industrial use slumps 23.6%

Electricity demand slumped 12.6 percent in April compared to the same month a year earlier, the biggest drop registered by high-voltage industrial consumers, forced to suspend or restrict output during the lockdown, power grid operator IPTO’s monthly report has shown.

Industrial electricity consumption in April fell sharply by 23.6 percent, the IPTO report showed.

The drop in electricity consumption linked to mining activity was even sharper, falling 55.5 percent in April. Besides the lockdown, this drop was also attributed to significant operational restrictions implemented at power utility PPC’s lignite-fired power plants.

Electricity generation in April fell by 3.2 percent, to 2,893 GWh compared to 2,990 during the same month a year earlier, according to the data.

This reduction was mild compared to major shifts observed in sources of generation. Lignite-based generation fell by 62.7 percent year-on-year, confirming, most emphatically, the commencement of PPC’s decarbonization effort.

High costs for lignite-based generation severely reduced the operational time of PPC’s lignite-fired power plants, limiting lignite’s share of the electricity production mix to just 10 percent in April.

On the contrary, the production share of interconnected RES facilities, benefiting from favorable conditions, rose sharply by 33.9 percent, year-on-year, to capture a market-leading 36 percent share of overall electricity generation in April.

Natural gas-fired power plants followed with a 30 percent share following an 11 percent year-on-year rise in output.

Electricity imports (grid interconnections) contributed 18 percent, while hydropower facilities increased their output by 19.8 percent to capture a 6 percent share in April.

PPC provided 951 GWh, or 56.6 percent of the production, while independent producers covered 43.4 percent.

Among the independent producers, Mytilineos led the way with 228.1 GWh, followed by Elpedison (210.4 GWh), Korinthos Power (154.1 GWh) and Heron II (136.3 GWh).

The IPTO data on generation highlights an increasing shift towards cleaner energy sources.

 

 

Wholesale electricity prices rising, up to €47.30/MWh today

Wholesale electricity prices, determined by the System Marginal Price, are rebounding following a significant drop over the past few weeks.

The rise is being fueled by an anticipated increase in demand. A sidelined 600-MW line linking Greece with Bulgaria, depriving the system of electricity imports via this route, as well as a disruption in operations at an Elpedison power plant in Thessaloniki are two other contributing factors.

In addition, the Revythoussa LNG terminal just off Athens is not under any pressure, a factor subduing gas-fired unit bids and subsequently lowering the SMP.

Based on grid orders placed for today, the SMP has climbed to 47.30 euros per MWh, up from a level of around 30 euros per MWh five days earlier and 14.20 euros per MWh on May 1. Bidding by units has gradually risen since early May.

Demand, today, for domestic consumption and exports is estimated to reach 127 GWh, 40 percent of which is planned to be covered by natural gas-fired power stations, 30 percent by RES and hydropower plants, 23 percent by electricity imports, and 7 percent by lignite-fired power stations.

The SMP level will be determined by gas-fired power stations for 22 hours today, lignite-based generation will shape the price for one hour and imports for the remaining hour.

RES generation in EU captures record share of energy mix

Renewable energy generation captured a record-high 35 percent share of the EU’s energy mix in the fourth quarter of 2019, up from 31 percent a year earlier, primarily as a result of record generation levels registered by the hydropower and wind energy sectors, latest European Commission data has shown.

Hydropower production rose significantly, by over 16 TWh year to year, while major gains were achieved by the wind energy sector, whose onshore wind farms grew by 9 TWh, or 9 percent year to year, and offshore wind farms registered a record year-to-year increase of 3.3 TWh, 18 percent.

Overall RES generation in December totaled 105 TWh, a new record level for the month, as a result of favorable conditions for wind farms and record hydropower production levels.

On the contrary, the energy mix share of fossil fuel fell to 39 percent in the fourth quarter of 2019, down from 42 percent a year earlier.

Greenhouse gas emissions in EU electricity generation fell by approximately 12 percent in 2019 as a result of the increase in RES production and a turn from coal to gas.

CO2 emission right costs increased by 57 percent year to year, to 25 euros per ton, according to the European Commission data.

 

 

PPC Renewables moving ahead with investment plans despite crisis

PPC Renewables, a subsidiary of power utility PPC, has, for the time being, remained unperturbed by the extremely adverse investment conditions prompted by the coronavirus pandemic and moved ahead with green energy project plans.

The company has completed tenders offering development contracts for a 5-MW hydropower facility in Karditsa, mainland Greece, as well as the first 15-MW stage of a 230-MW solar park in Ptolemaida, northern Greece.

The winning bidders of both contracts should be announced around late April or early May, barring unexpected developments.

PPC Renewables has already launched a second tender for the Ptolemaida solar park, once again offering a development contract for 15 MW, ahead of the 230-MW project’s main tender, for 200 MW, expected in mid-April.

The company secured a price of 49.11 euros per MWh for its Ptolemaida project at an auction staged today by RAE, the Regulatory Authority for Energy.

During its construction stages, the Ptolemaida project is expected to create at least 300 jobs, while, when completed, the facility should generate 390,000 MWh, enough to cover the needs of 290,000 persons.

PPC Renewables is expected to be among the first companies to induct projects into the Target Model, in other words, contracts with consumers whose prices will no longer be determined at auctions staged by RAE, the Regulatory Authority for Energy.

Grid entry adjustment for PPC telethermal-linked lignite units

The energy ministry is set to satisfy a power utility PPC request prioritizing the grid entry of its lignite-based production for telethermal support without factoring in this input to calculations determining the system marginal price, or wholesale price.

This requested procedure already applies for PPC’s compulsory hydropower input and RES units.

Under the current system, state-controlled PPC is incurring losses when entering into the grid lignite-fired units for telethermal needs in the west Macedonia and Megalopoli regions. More specifically, the utility is being forced to not operate its gas-fueled power stations, despite their lower operating costs, prompted by the large reduction in gas prices.

PPC’s LNG purchases, as a result, are not being utilized.

The ministry is now preparing a legislative act for the adjustment. It could apply for a limited amount of time to cover remaining telethermal needs in the post-winter season.

Independent producers have reacted against the plan. Some producers appear determined to take the issue to the EU competition authority, noting priority rule exemptions can only be made for RES, Combined Cooling, Heat and Power (CCHP) and hydropower units.

 

Reference prices for auction-free RES categories lowered

The energy ministry is set to sign a decision adjusting downwards reference prices for renewable energy stations not obliged to participate in competitive procedures.

This category includes small-scale hydropower stations, biomass, biogas and geothermal stations, wind energy facilities under 3 MW (6 MW for energy communities), as well as yet-to-be-launched wind energy facilities over 3 MW for which agreements were signed in 2016.

The new reference prices will apply for projects scheduled for launch and actual price settings following January 1, 2022.

Existing reference prices are based on legislation passed in 2016 and have not been adjusted since, except for wind energy facilities, which were subject to a price reduction following a related decision last year.

The forthcoming ministerial decision will seek to rationalize RES prices compensating the aforementioned RES categories, which, as a result of unique factors, are not required to participate in competitive procedures, as is the case for bigger wind energy projects as well as solar energy projects.

Brussels pressuring for wider access to PPC lignite power

The European Commission’s Directorate-General for Competition has proposed wider participation in a Special Purpose Vehicle plan tabled by the energy ministry that would effectively also take on board independent electricity suppliers, not just energy-intensive industrial enterprises, for purchases of lower-cost lignite-generated electricity produced by power utility PPC.

Energy ministry officials began talks aiming for further electricity market liberalization in Greece in the lead-up to the Christmas break. These are expected to continue following the festive season and end by mid-January.

The energy ministry officials went into the talks having proposed the establishment of an SPV that would exclusively facilitate lignite-generated electricity purchases made by energy-intensive industrial enterprises.

This is seen as a plan that could contribute to the power utility’s market share contraction in the high-voltage category and also support emission cost savings.

Greece’s pledge for a thorough plan promising to fully liberalize the electricity market and break PPC’s ongoing dominance has been under the spotlight during these talks.

Going into the negotiations, Brussels made note of Greece’s non-compliance with a European Court ruling on PPC’s lignite monopoly.

The European Commission has remained relentless in its demand for corrective anti-monopoly measures on lignite, including, according to sources, the establishment of auctions along the lines of the NOME auctions recently abolished by the Greek government.

Brussels insists the SPV would need to be supplied electricity by PPC through auctions. Greek officials have sought to avoid discussing such a prospect given the government’s recent decision to end NOME auctions, arguing these have cost PPC plenty without delivering results in terms of market share contraction at the utility.

A proposal entailing hydropower sourced electricity supply to the SPV, in addition to lignite-generated electricity, has also been tabled at these talks. This would help limit emission costs if suppliers also enter the SPV.

The European Commission may have applauded the government’s recent decision for a swifter decarbonization process, but it has remained adamant on the necessity for third-party access to lignite – until 2023, when all of PPC’s existing lignite units are planned to have been withdrawn – as well as hydropower  if full market liberalization is to be achieved.

 

Analytical lignite withdrawal plan among NECP revisions

Full details on the withdrawal schedule of power utility PPC’s lignite-fired power stations as well as slightly more ambitious targets for greenhouse gas emission reductions and renewable energy production represent some of the key changes included in the government’s finalized National Energy and Climate Plan, delivered to Brussels just days ago, energypress sources have informed.

More ambitious projections on cleaner electricity generation by 2030 through hydropower, wind and solar sources feature as the most significant changes compared to the initial NECP version forwarded for public consultation.

Projections for significant PV development cost reductions are included in the plan.

The environment and energy ministry has provided further details on its ambitious 38 percent energy savings target, primarily through energy efficiency improvements at buildings, after the initial NECP was criticized for lacking specifics in this domain.

Installed capacity increases for hydropower generation, including pumped storage, from 2025 onward, stand as the only change in renewable energy generation. Installed capacity targets for all other RES technologies remain the same.

RES electricity generation target increases for hydropower and wind facilities have been included, while PV generation targets have been lowered, keeping the overall total unchanged.

Challenges of revised NECP, sent to Brussels, ‘will be met’

The lofty challenges of Greece’s revised National Energy and Climate Plan, delivered to the European Commission yesterday following its endorsement late last week by KYSOIP, the Government Council for Economic Policy, will be met, the government’s energy deputy has stressed.

“The preparation of the plan has been done and the challenge of achieving the ambitious goals it envisages stands before us,” noted Deputy Energy Minister Gerassimos Thomas. “We are ready to respond to this challenge and contribute to the extent needed for us to achieve European objectives for a major reduction of greenhouse gas emissions by 2030 and their elimination by 2050,” he added.

New aspects related to matters including spatial, bioclimatic and urban planning, were incorporated to the finalized NECP version following 168 comments submitted to the OpenGov.gr website during public consultation as well as proposals and observations submitted to the energy ministry, it announced in a statement.

The NECP, establishing decarbonization as a top priority, includes a detailed schedule on the planned withdrawal of power utility PPC’s lignite-fired power stations. All existing lignite units are planned to be withdrawn by 2023.

In its renewable energy section, the NECP highlights the significant role to be played by hydropower energy and, especially, projects with reservoirs, as well as the importance of implementing pilot projects that will lead to RES sector coupling.

Hydropower objectives elevated slightly for finalized NECP

Greece’s finalized new National Energy and Climate Plan, whose final touches are being added today at the energy ministry ahead of an inspection tomorrow by KYSOIP, the Government Council for Economic Policy, will feature slightly increased objectives for the hydropower and pumped storage sectors, sources have informed.

Certain revisions to the NECP’s details on geothermal production, other RES technologies, the decarbonization plan, and networks will also be made, the sources added.

The mass withdrawal, by 2023, of all existing lignite-fired power stations, exclusively operated by the power utility PPC, is a key feature of the new NECP.

So, too, is a decision to offer investors a solid minority stake in distribution network operator DEDDIE/HEDNO, a PPC subsidiary, instead of a majority stake, as was previously contemplated.

On the hydropower target revisions, the NECP will set an installed capacity target of 3.4 GW by 2020 and 3.7 GW by 2030.

Once past KYSOIP tomorrow, Greece’s new NECP will immediately be forwarded to the European Commission.

Energy savings, primarily concerning a reduction of the environmental impact of buildings and vehicles, will be crucial if the NECP’s ambitious RES targets are to be achieved.

 

Hydropower development a key part of PPC’s RES growth plans

Power utility PPC is determined to partner with private-sector companies for the development of new hydropower projects, both small and large-scale, as it also seeks to do with other investments, both in the renewable energy domain and beyond.

A critical question that arises, however, is whether PPC – currently holding talks with over ten private companies, according to chief executive Giorgos Stassis – also intends to contribute existing hydropower plants, not just new hydropower projects, to SPVs planned to be formed for renewable energy collaborations.

Stassis remained vague on this matter during his presentation of PPC’s new business plan earlier this week.

However, highly-ranked PPC officials, in comments to energypress, have ruled out the inclusion of any existing hydropower plants owned by the utility in any prospective SPVs to be co-founded with private-sector partners.

Whatever the outcome, PPC, for a number of key reasons, is looking deep into prospective hydropower collaborations.

The power utility wants to sharply increase its RES market share over the next few years, to offset its planned withdrawal of all existing lignite-fired power stations by the end of 2023. A RES market share of at least 10 percent, even 20 percent, up from a current level of 2.5 percent, by 2024, is being looked at.

PPC also wants to avoid European Commission pressure that could force a sale of hydropower units or lead to a compulsory surrender of hydropower production.

Georgian energy market opportunities to be discussed at Tbilisi event

Georgian energy market opportunities will be discussed at the upcoming Energy Week Georgia 2020, a high-level event scheduled for January  28-30 in Tbilisi with the support of the Ministry of Economy and Sustainable Development of Georgia.

Investors, EPC and engineering companies as well as international contractors will be participating.

The energy sector of Georgia is very attractive in terms of its untapped potential, developing infrastructure and increasing local and regional demand. In particular, investors and developers are seeing increasing renewable energy opportunities in the country.

RE Market Opportunities Appealing

Domestic demand is expected to almost double by 2030 from current consumption of 13.4 TWh. Georgia’s generation capacity will not be enough to meet domestic demand in the long term without additional generation sources. The estimated deficit by 2025 is more than 3 TWh.

Starting from 2008, Georgia has liberalized and deregulated the energy market. The State Program Renewable Energy 2008 stipulates the rules and procedures regarding construction of new renewable energy projects. The electricity may be sold to any buyer in Georgia, based on freely negotiated prices, and/or to the electricity market operator (ESCO) based on the guaranteed power purchase agreement.

Georgia has well-developed transmission grid infrastructure. The whole territory of the country is covered with over 3,000 km of high, medium and low voltage lines and about 100 substations. In 2013, a new 400 KV line with HVDC back-to-back substation connecting Georgia with Turkey was commissioned, adding to already significant transmission capacity with all neighboring countries.

Major Potential for Hydropower

Georgia is one of the top countries in terms of water resources per capita and more than 80% of total electricity in the country is generated by HPPs. At the same time, only 25% of economically feasible hydro potential is exploited today.

There are 118 ongoing HPP projects, divided by the following categories:

  • 74 projects up to 13 MW – total installed capacity 363 MW and about $ 400 million investment;
  • 44 projects from 13 MW – total installed capacity 2 986 MW and about $ 5.7 billion  investment.

Wind and Solar Considerations

Georgia has significant wind potential through which average annual electricity generation is evaluated at 4 bln. KWh and installed capacity of 1,500 MW. There are 18 wind energy projects on feasibility study stage with a total installed capacity of 462 MW. Among largest projects are Imereti 1 Wind Farm (300 MW), Central Wind Farms (120 MW), Pirveli Wind Farm (110 MW) and Kartli 2 Wind Farm (100 MW).

There are 6 solar projects at feasibility and construction stages with a total installed capacity of 93 MW. Among largest projects is a 50 MW AE Power Tbilisi Solar Farm.

For further information on Energy Week Georgia 2020, visit www.geenergyweek.com 

 

Hydropower Balkans 2019 event in Belgrade a major attraction

The 3rd Annual International Investment Summit and Exhibition “Hydropower Balkans 2019”, held November 7-8 in Belgrade, brought together participants from 20 countries and featured presentations of HPP greenfield and brownfield projects in Greece, Albania, Bosnia and Herzegovina, Bulgaria, Montenegro, North Macedonia, Republike, Serbia, Slovenia and Srpska.

Participating companies included JS Elektroprivreda Srbije, European Bank for Reconstruction and Development, Albanian Power Corporation (KESH), Bulgarian Energy Holding, Elektroprivreda Republike Srpske, European Investment Bank, Hidroelektrarne na Spodnji Savi, International Finance Corporation,  Power Plants of North Macedonia, Montenegrin Electric Enterprise (EPCG), Hydro Power Plants at Vrbas,  PPC S.A., PPC Albania, Holding Slovenske elektrarne, Government of Republic of North Macedonia, EcoEnergy Consulting and Elektroprivreda BiH.

Plenary session participants concluded that the decarbonization process requires a significant increase of investments in clean generation and storage as well as additional grid and infrastructure investments.

Political risks, regulatory complexities, social and environmental issues are the most significant challenges for developers and investors, participants agreed.   

A round table dedicated to engineering aspects of HPP construction and renovation concluded the first day of the summit. International engineering companies and equipment suppliers discussed all project details directly with CTOs.

Decision makers at major financial institutions such as International Finance Corporation, European Bank for Reconstruction and Development, as well as the European Investment Bank, informed participants on investment opportunities in the regional hydropower industry, challenges for developers and investors and risk mitigation.

At this year’s event, special attention was paid to small-scale hydropower potential in the Balkans.

Two round tables devoted to Serbia and Bosnia and Herzegovina concluded the Summit.

In addition, a specialized exhibition on industry technology took place as part of the summit. Market leaders presented their technical, technological and service solutions for the region. They included ABB Italy, Sevinc Machine Industry and Trade, Emerson Process Management, Stucky, Tor Services, Zollern, Rakurs Engineering, Polyar Steel Construction, AUMA, Alpiq AG, Tractebel Engineering, AF Сonsult, and Landsvirkjun Power.

More than 150 business meetings were held during the summit.

The event was organised by Vostock Capital, officially supported by JS Elektroprivreda Srbije and sponsored by ABB Italy, Sevinc Machine Industry and Trade, as well as Emerson Process Management.

DG Comp summons ministry officials over PPC dominance

A team of energy ministry officials has been summoned by the DG Comp for a meeting in Brussels this week to be dominated by power utility PPC’s ongoing electricity market dominance as well as the state-controlled corporation’s intended position in the new-look electricity market being shaped as part of the target model.

PPC’s role remains a concern in Brussels following last July’s collapse of a sale effort that had been intended to offer investors lignite-fired power stations belonging to the utility.

Greece’s next Enhanced Surveillance Report is expected late in November.

In Brussels, the energy ministry officials will be looking to ease a PPC retail electricity market share contraction target of 50 percent, included in the country’s third bailout agreement, to 65 percent, seen as feasible.

The DG Comp is expected to remain firm on the original target unless the Greek officials table an offsetting measure of equivalent worth.

Brussels officials also want further information on the forward market, including the duration and technical details of contracts, planned to be launched in February, 2020.

The energy ministry is seeking to convince concerned independent electricity suppliers that the forward market will compensate for a planned termination of NOME auctions.

The DG Comp’s position on the country’s hydropower market is also eagerly anticipated. Early in 2017, Brussels officials had raided the headquarters of PPC and power grid operator IPTO as part of an alleged market-abuse investigation. Findings have yet to be reported.