Ministry turns to wholesale market for cost-cutting leeway

The energy ministry is preparing to scrutinize the wholesale electricity market in search of leeway for cost-cutting measures that could ultimately lead to lower retail electricity prices, ministry officials have told energypress.

This initiative comes following a series of cost-reduction measures prepared for the retail electricity market and set to be introduced.

The ministry intends to conduct a deeper examination of all market factors and tariff charges in an attempt to lower their cost and make them more competitive, energy minister Thodoris Skylakakis noted at a recent conference organized by IENE, the Institute of Energy for Southeast Europe.

The ministry’s effort will place emphasis on reducing Balancing Market costs by limiting quantities that need to be activated.

The Balancing Market is a mechanism ensuring that electricity supply matches demand in real-time. By optimizing the activation of balancing quantities, it is possible to enhance the efficiency of the market and potentially reduce associated costs.

The ministry’s series of retail electricity market cost-cutting measures, already prepared, include stricter rules to counter electricity theft; consumers switching suppliers despite owing overdue amounts at previous suppliers; and imposing limits to the country’s universal electricity supply service, offered, by law, by the top five suppliers as a last-resort solution to black-listed household and business consumers who have been shunned by suppliers over payment failures. The majority of consumers moving on to this service continue to not pay for electricity supply.

Stricter switching, power theft rules headed for Parliament

The energy ministry plans to submit a draft bill of retail electricity market revisions to Parliament next week. The bill contains stricter rules aiming to prevent consumers with unpaid electricity bills from switching suppliers and counter electricity theft.

Consumers will not be able to move away from their electricity supplier if the supplier is the third power retailer at which they have accumulated overdue energy bills within a five-year period beginning January 1, 2020, according to the draft bill.

This obstacle will be combined with a debt-flagging system prepared by RAAEY, the Regulatory Authority for Waste, Energy and Water, energy minister Thodoris Skylakakis informed suppliers just days ago.

The retail electricity market revisions also include a single variable tariff formula that all electricity retailers will need to adopt and include in their tariff packages offered to customers as of January 1, 2024.

Speaking yesterday at the 27th National Energy Conference “Energy + Development”, an event organized by IENE, the Institute of Energy for Southeast Europe, the energy minister spoke of the very high cost to the system caused by electricity theft, estimating its cost at 400 million euros per year.

Rules against electricity thieves will become a lot stricter, while complicit electricians will have their professional licenses revoked, according to the new rules.

Wholesale electricity prices up over past week

Wholesale electricity price levels rose over the past week, the average market clearing price rising by 4.76 percent compared to the previous week to 151.95 euros per MWh, with upper and lower levels reaching 218.35 and 80.16 euros per MWh, respectively.

The past week’s highest average market clearing price was recorded on March 2, reaching 160.60 euros per MWh.

During the same period, wholesale electricity price levels in other parts of Europe ranged from 136 to 195 euros per MWh, while prices yesterday ranged from 141 and 167 euros per MWh.

Electricity demand remained low, for this time of the year, while lower RES and hydropower unit output led to a slight increase in prices at the Hellenic Energy Exchange, according to an analysis by IENE, the Institute of Energy for Southeast Europe.

RES units averaged a daily output of 36 GWh for an energy-mix share of 29 percent over the past week, official data showed. RES output totaled 251 GWh for the week, an 11 percent reduction compared to a week earlier.

Hydropower facilities covered 2 percent of demand, injecting just 16 GWh into the grid, 14 percent less than a week earlier. Natural gas-fueled power stations generated 286 GWh over the past week, covering 33 percent of demand, while lignite-fired power stations produced 145 GWh to cover 17 percent of electricity demand.

Electricity demand remained virtually unchanged over the past week, at 897.131 MWh, compared to 897.306. It peaked at 138.128 MWh last Thursday, while the week’s low was recorded on February 27, at 107.471 MWh.

The low-voltage category, including households, represented 56 percent of electricity demand over the past week, the medium-voltage category represented 19 percent of demand, the high-voltage category, or energy-intensive industry, represented 17 percent, 5 percent concerned the Cretan grid, while electricity losses of 3 percent were also recorded.

Exchange’s day-ahead market growing, new products soon

The Hellenic Energy Exchange’s natural gas trading floor, launched eight months ago, has been positively evaluated for its operations to date and is steadily growing.

The natural gas trading floor was launched with eleven participants and now involves eighteen, plus the gas grid operator DESFA, significantly expanding its gas market presence.

For its part, the Energy Exchange has set as a key objective a further increase of transactions in the short term and, at the same time, registration of a greater number of participants.

At present, 5.5 percent of the total volume of natural gas distributed through the DESFA grid is traded at the Energy Exchange’s natural gas trading floor, the bulk of it as bilateral agreements between participants.

According to energypress, the Energy Exchange plans to further develop by launching new products next year.

It is worth noting that an increase in day-ahead contracts has been observed, not just for gas balancing, which is a good sign for the market’s liquidity and the further maturation and consolidation of the natural gas trading floor in the Greek gas market.

According to data presented by Dr. Christoforos-Anestis Zoumas, Acting COO & Director – Markets Operations of the Hellenic Exchange at a recent IENE conference, the share of the day-ahead market in terms of trading volume is 52.28% and is constantly increasing.

 

 

RAE proceeding with legislative steps for energy storage

RAE, the Regulatory Authority for Energy, is examining a further step in legislative preparations for energy storage’s induction into the country’s grid, the authority’s president Athanasios Dagoumas has told an IENE (Institute of Energy for Southeast Europe) conference on “Electricity storage and grid management for maximum RES penetration”.

The authority is looking to proceed with an energy storage formula for distribution network operator DEDDIE/HEDNO and power grid operator IPTO, concerning energy storage services such as ancillary services and congestion management.

Up until July this year, RAE had issued a total of 337 licenses representing a capacity of 23.5 GW, concerning storage projects, purely, as well as hybrid projects – combining storage with RES – and pumped storage units.

The vast majority of these RAE licenses concern pure storage units and were issued between January, 2021 and July, 2022.

Investors behind the projects have, as a result of newer legislation, been requested to resubmit supporting documents for older licenses in order to have them renewed.

Many of these investors have already provided the necessary documents and are awaiting license renewals, while RAE is believed to be preparing a great percentage of these, sources informed.

Terna Energy pumped storage station construction in October

Terna Energy has taken a final investment decision, worth 500 million euros, on the development of a pumped storage station complex in Amfilohia, northwestern Greece, whose construction is planned to begin in October and be completed within four years, the company’s hydroelectric projects director, Yioula Tsiknakou, has informed an IENE online workshop on energy storage.

The complex is planned to generate a total of 816 GWh, annually, and offer a total installed capacity of 680 MW (production) and 730 MW (pumping).

It will consist of two independent upper reservoirs, Agios Georgios and Pyrgos, with respective capacities of approximately 5 and 2 million cubic meters, and power utility PPC’s existing common lower reservoir, Kastraki Lake, developed in 1960.

Over 70 percent of the investment’s funds are planned to stem from the Greek market.

Its construction is expected to create approximately 1,200 jobs while a 100-member workforce will be employed once the unit is in operation.

Pumped storage stations are the most appropriate form of technology for mass energy storage, Tsiknakou, the Terna Energy official, told the IENE workshop.

Pumped storage stations are nowadays the most widespread mass energy storage solution, representing over 94 percent of installed energy storage capacity and offering total capacity of 161 GW around the world.

Upper limit for target model agreements a contentious issue

Imposing an upper limit on day-ahead market bilateral agreements has developed into one of the most contentious issues in the lead-up to the target model.

Opposing views were voiced, once again, last Friday at an IENE (Institute of Energy for Southeast Europe) conference.

Industrial sector officials fear the implementation of a single-digit upper limit, as requested by ESAI/HAIPP, the Hellenic Association of Independent Power Producers, would not provide industrial enterprises with enough space to reach agreements with power utility PPC as a means of covering their needs.

Imposing an upper limit on PPC’s forward contracts would cancel out the industrial sector’s accessibility to such products, EVIKEN (Association of Industrial Energy Consumers) board member Antonis Kontoleon told the IENE event.

The imposition of such a limit on PPC should be matched for all vertically integrated players, Kontoleon added.

Such a limit would prevent producers from establishing forward agreements with their own supply firms.

ESAI/HAIPP chief official Giorgos Stamtsis noted that the structure of the Greek market is characterized by the presence of one dominant company with exclusive access to lignite, major-scale hydropower facilities, as well as a very high market shares in the retail market, over 70 percent, as well as the wholesale market.

 

EDEY presenting five new fields in search for more investors

EDEY, the Greek Hydrocarbon Management Company, is seeking to draw an increased level of attention from petroleum firms for natural gas and oil exploration through five new offshore blocks, located in the Ionian Sea, off Crete and south of the Peloponnese.

The five blocks, ranging from 8,000 to 22,000 square kilometres in size, were presented yesterday by EDEY chairman Yiannis Basias at a workshop organized by IENE, the Institute of Energy for Southeast Europe.

EDEY has reprocessed related seismic survey data concerning these five blocks and plans to present findings at international conferences and meetings with the objective of generating the interest of oil majors.

The Greek hydrocarbon company’s latest initiative comes at a time of elevated activity among southeast Mediterranean, Black Sea and Adriatic countries, all staging tenders for blocks or conducting surveys and drills.

Global oil industry players have turned their attention to the wider region. Total, ExxonMobil, Repsol and Edison have already established a presence on Greek territory. EDEY is hoping to add to the list.

RES potential and electricity network challenges pointed out by IENE head

Renewable energy sources, which have made their presence felt in the current decade as a result of technological advancements, are expected, along with large-scale hydropower facilties, to represent the main source of energy in the world before 2050, reducing the role of fossil fuels, especially coal, and to a certain degree, fuel, Yiannis Hatzivasiliadis, President of IENE, the Institute of Energy for Southeast Europe, notes in an article appearing in Greek Energy 2017, an annual energypress industry publication.

Besides their zero-level CO2 emissions, renewable energy sources offer energy supply security and competitive costs as a result of new technologies being introduced, the IENE chief notes in the Greek Energy 2017 article.

The increasing penetration of renewable energy sources is transforming the energy sector, including electricity networks, he notes.

The IENE president states that major RES penetration, even as much as one-hundred percent, does not represent a utopian thought, pointing out that certain countries have already made such achievements. He mentions Iceland, whose hydropower and geothermal production have led to 100 percent RES penetration, Norway’s 97 percent, courtesy of its hydropower generation, Georgia’s 85 percent, also through hydropower generation, Brazil (76%) and Austria (70%) as notable examples. Certain countries not endowed with rich hydropower and geothermal potential are in a position to utilize their high solar and wind potential, Hatzivasiliadis writes, framing Greece.

Greece’s many islands and heightened RES potential represent the biggest challenges and opportunties for renewable energy penetration into the country’s energy mix during the 21st century, the IENE heads points out.