RES output high in ’21, demand back to pre-pandemic level

The RES sector set a new production record in 2021, reaching 17,193 GWh, up from 14,800 in 2020, a 16.2 increase, while, in another important development last year, electricity demand rebounded to pre-pandemic levels of 2019, totaling 52,322 GWh, up 4.7 percent compared to 2020, data provided in a latest monthly report from power grid operator IPTO has shown.

Another eco-friendly energy source, hydropower, also ended 2021 with a record production level of 5,293 GWh, 82.5 percent higher than the 2020 total of 2,900 GWh, the IPTO report showed.

The RES and hydropower sectors, combined, provided 46.1 percent of the country’s overall electricity production in 2022, which reached 48,721 GWh.

Lignite-fired generation fell by 7 percent, to 5,341 GWh, in 2021, reflecting this high-polluting and high-cost energy source’s continual retreat.

Power utility PPC has been regaining ground during the energy crisis of the past few months, increasing its retail electricity market share to 63.9 percent in December from 63.1 percent a month earlier, the IPTO data showed.

PPC’s retail electricity market share has increased by nearly two percentage points  since September, when the energy crisis hit.

Gov’t utilizes EU terms to offer PPC lignite units more time

The government has utilized flexible terms in European law, expiring tomorrow, concerning high-polluting power stations to secure a further extension for power utility PPC’s lignite-fired power stations, through additional operating hours, which, in some cases, could stretch as far forward as 2025.

Even so, the power utility insists this initiative will not change the corporation’s withdrawal plan for its lignite-fired power stations, according to which all existing units will be withdrawn by the end of 2023.

PPC, in an announcement, has informed that the additional operating hours secured for lignite-fired power stations will be used within the time limits of respective withdrawal plans that exist for units.

The power utility has avoided using its lignite-fired power stations to full capacity, even though they have developed into lower-cost options than natural gas-fueled power stations.

Under the current market conditions, wholesale electricity prices may have been lower if PPC used its lignite-fired power stations more frequently.

Greater use has been avoided by PPC as these units remain loss-incurring for the power utility given the increasing prices of CO2 emission rights and a variety of technical difficulties, sources told energypress.

 

Legislative revision ends saga for sale of PPC 17% stake

Power utility PPC’s long-running saga concerning the privatization of a 17 percent stake has ended following a legislative amendment submitted by the finance ministry to facilitate the process.

The step was supposed to have been taken in 2012, during the country’s first bailout agreement. The then-government ran out of time and ended up transferring the 17 percent stake to privatization fund TAIPED in 2014.

Two years later, in 2016, EESYP, the super privatization fund, was established, to which the Greek State transferred the other 34 percent stake it held in PPC.

From that period onwards, a variety of scenarios concerning the sale of PPC’s 17 percent came and went, covering the entire period of Greek bailouts.

In the post-bailout era, the current government wanted PPC, following its financial restructuring, to play a leading role in the energy transition. As a result, last autumn, a decision was made to proceed with an equity capital raise at PPC that would result in a total stake reduction to 34 percent for the two privatization funds, TAIPED and EESYP.

The recent equity capital raise resulted in EESYP, the super privatization fund, having a PPC stake of 23.8 percent stake, down from 34 percent, and TAIPED, the other privatization fund, having a 10.32 percent stake, down from 17 percent.

 

PPC’s returning customers still rising, up 44% in November

The number of customers returning to power utility PPC continued to grow in November,  7,500 customers leaving independent suppliers for the switch, a 44 percent increase compared to a month earlier, when 5,200 customers returned to the power utility.

Despite the rising number of customers returning to PPC, the outflow to independent suppliers still remains greater, meaning the power utility’s customer base is shrinking, but at a slower rate.

According to data covering the market from January through November, approximately 29,800 customers left independent suppliers to return to PPC, nearly fivefold the figure registered for the equivalent period last year, or 490 percent higher.

It remains unclear if December will produce a similar pattern. PPC, since the beginning of the month, has introduced a fixed-tariff offer of 18 cents per KWh (17 cents per KWh for online applications).

PPC chief executive Giorgos Stassis recently denied that competition in Greece’s electricity market is eroding. He stressed the market has been fully liberalized, noting the power utility’s retail market share will gradually fall to nearly 50 percent over the next few years.

 

PPC cuts operator, contractor debt by €800m in 2 years

Power utility PPC has settled most of its outstanding debt owed to operators and contractors, reducing the amount from 900 million euros in 2019 to 70 million euros at present, the figure with which the corporation expects to end the year, energypress sources have informed.

During the country’s ten-year recession, prior to the pandemic, PPC’s debt owed to operators and contractors had peaked at nearly one billion euros.

The corporation now owes 50 million euros to contractors and 20 million euros to the three market operators – DAPEEP, the RES market operator; IPTO, the power grid operator; and DEDDIE/HEDNO, the distribution network operator – latest company data has shown, the sources noted.

Besides benefitting PPC, which, for years, was embroiled in a series of legal battles with operators, contractors and equipment suppliers, the debt reduction is also helping offer market stability.

Other suppliers have had difficulties keeping up with payments to operators during the energy crisis and its narrower profit margins. If PPC, the dominant supplier, was also delaying its payments to operators at present, the energy market may have been in an unstable condition.

The total amount currently owed by electricity suppliers to the market operators is estimated at 350 million euros, making PPC’s 20 million-euro owed just a fraction of the sum.

 

PPC lifts bailout-related salary limits, bonus payments back

Bailout-related salary restrictions that had been imposed on power utility PPC from 2010, like all other state-controlled entities, have been officially lifted by the board following the Greek State’s reduced stake to less than 49 percent, for the first time in the company’s 70-year history, early last month.

Employees will now regain rights for bonus payments, adding a further two months of salaries to their annual income.

The completion of PPC’s equity capital increase in early November left the Greek State with 34 percent of the company. Foreign institutional investors hold an overall 50 percent and domestic stakeholders have a 16 percent share.

The company’s workforce numbers and payroll cost have been reduced in recent years following a series of voluntary exit programs.

In 2009, a year before the salary restrictions were imposed, PPC’s annual payroll cost totaled 1.49 billion euro. It fell to 1.24 billion euros in 2010, when the company’s workforce numbered 21,845 persons. By 2019, PPC’s payroll cost had fallen to 817 million euros before dropping further last year, to 734.8 million euros, as a result of the voluntary exit programs, leaving 13,832 employees on the company payroll at the end of last year.

The contraction continued in the first nine months of 2021. Payroll cost fell to 482.7 million euros, not including lump-sum exit payments, from 519.2 million euros in the equivalent nine-month period of 2020, while the workforce numbered 13,103 at the end of this year’s nine-month period. These figures indicate the end-of-year payroll and workforce numbers will be lower compared to the end of last year.

 

PPC lignite reserves, stations ready for winter, official assures

Lignite reserves are sufficient to meet elevated demand this winter, while the country’s lignite-fired power stations, hydropower facilities and lignite mines are all set to operate, Dimitris Metikanis, general manager of power utility PPC’s lignite production division has noted in Parliament, in response to questions over energy sufficiency and the energy crisis.

PPC has done all that is possible to prepare the country’s lignite and hydropower units for possible energy demand increases during the winter, the PPC official noted.

Maintenance levels for the country’s lignite facilities have been relaxed in recent times as these units are headed for withdrawal by 2023, as part of Greece’s decarbonization effort. However, the energy crisis may require the lignite units to be brought back into play this winter.

Adequate lignite sources are expected to prevent a reliance on electricity exports, while PPC’s lignite-fired power station Agios Dimitrios V is expected to return by the end of the year after being sidelined for desulfurization work, the official informed.

Daily electricity demand in Greece is projected to reach between 180 and 190 GWh during colder weather conditions from December to February, according to power grid operator IPTO projections.

Such demand levels will require contributions from all available lignite-fired power stations, seven in total – Agios Dimitrios I, II, III, IV and V, Melitis and Megalopoli IV – offering a total capacity of 1,800 MW.

 

PPC ’21 operating profit virtually unchanged at €800-850m

Power utility PPC is headed for an operating profit of between 800 and 850 million euros for 2021, marginally below the previous year’s level, despite the impact of the energy crisis on outlays in the third quarter, the corporation’s administration has informed analysts during a presentation of results for the nine-month period.

PPC’s outlays for natural gas, energy and CO2 emission right purchases rose by an overall 629 million euros in the first nine months, to a level 37 percent higher than the total registered for the equivalent period in 2020, PPC officials reported.

Natural gas outlays were up 119.8 percent, reaching 452.7 million euros from 206 million euros.

PPC’s outlays for liquid fuels increased by 14.7 percent in the first nine months to 410.2 million euros, compared to the equivalent period in 2020, as a result of higher prices for mazut (8.9%), diesel (8.4%) and increased generation powered by liquid fuels.

The corporation’s CO2 emission right outlays surpassed all other expenses, reaching 539.4 million euros in the nine-month period of 2021 from 263.1 million euros during the same period a year earlier.

 

PPC set to offer new fixed tariff package, beginning December 3

Power utility PPC is introducing a new fixed-tariff package for consumers, as of December 3, as part of the corporation’s hedging formula to offset risks.

The new package will, as of this coming Friday, offer consumers a fixed tariff of 18 cents per KWh, or 17 cents per KWh for online applications, as well as a 50 percent discount on fixed costs for the first six months if applications are lodged by a December 31 deadline. Tariff levels of rival suppliers currently average 23 cents per KWh.

The packages will be offered as one-year agreements and include household coverage for emergency technical support. The insurance policy incorporated into new agreements will entitle holders up to five visits per year from tradesman such as plumbers and electricians and cover damages up to 100 euros per visit.

 

 

Slight relaxation of lignite withdrawal plan, ’28 a firm date

 

The government’s climate change rules concerning the country’s withdrawal plan for power utility PPC’s lignite-fired power stations appears headed for a slight relaxation by taking into account the difficulties brought about by the energy crisis, leaving 2028 as the only definite deadline for the withdrawal of the utility’s very last lignite facility, Ptolemaida V, a new facility yet to be launched.

A plan for an accelerated withdrawal of all existing lignite-fired power stations by 2023, announced by Prime Minister Kyriakos Mitsotakis at a UN Climate Action Summit in 2019, is now being reassessed and has been put through public consultation running until December 24, the objective being to ensure grid sufficiency in the face of changes.

The withdrawal of lignite-fired power stations, all operated by PPC, is a tricky equation as a swift procedure promising to curtail PPC’s lignite-related losses – these units are currently profitable, an energy crisis abnormality – needs to be balanced with grid sufficiency protection.

PPC’s rise prompts response of rivals over hydropower control

The rising number of customers returning to power utility PPC is triggering a response from rival independent electricity producers and suppliers, some of which, according to sources, are set to raise competition concerns with Greek and EU authorities by noting the utility’s exclusive use of the country’s hydropower facilities puts it in an advantageous position as profit generated from this activity is, to a great extent, being utilized for an aggressive pricing policy, helping win back customers.

This is not the first time PPC’s exclusive use of Greece’s hydropower capacity is being brought to the fore. On the contrary, it has always been on the European Commission’s agenda, especially during the previous decade’s period of Greek bailout negotiations, and was incorporated in related reports.

However, concerns over PPC’s lignite monopoly and how this matter should be tackled, which led to the introduction of NOME auctions, now abolished, followed by a recent agreement for PPC lignite packages to rivals, have taken precedence.

It seems the hydropower matter has now reached the tipping point for PPC’s rivals, facing toughened market conditions shaped by the energy crisis.

A number of independent producers are believed to be set to forward market data to RAE, the Regulatory Authority for Energy, as well as the domestic and European Commission competition authorities, to highlight their disadvantageous positions and call for intervention.

Minister calls meeting on winter energy sufficiency challenge

Energy authorities are expected to focus on the challenge of assuring energy sufficiency over the winter season at a meeting of today, called by energy minister Kostas Skrekas as a result of production capacity concerns at the country’s lignite facilities.

Maintenance level cutbacks at the country’s lignite-fired power facilities, in anticipation of their decarbonization-related withdrawals, may end up affecting the performance of some units, but their contribution to the grid could be crucial as a result of the wider impact of the energy crisis on the market.

The energy minister called today’s meeting in response to a letter forwarded by power utility PPC, controlling the country’s lignite facilities, to power grid operator IPTO, in which current problems faced by lignite-based electricity generation were stressed.

PPC 300% increase in returning customers, outflow still bigger

The number of customers returning to power utility PPC in October increased by more than 300 percent compared to May, but the company is still losing more customers than it is gaining, latest market data obtained by energypress has shown.

PPC gained 5,200 new customers in October, compared to 1,350 five months earlier, the data showed. If the wave of PPC’s returning customers continues to swell, the inflow of customers will eventually exceed the outflow.

Recent data made available by distribution network operator DEDDIE/HEDNO backs this trend as the operator’s figures showed that PPC lost 47,000 low-voltage connections between the second and third quarters, well below the 71,000 lost between the first and second quarters.

PPC represented 5.06 million low-voltage connections in September, a 74.2 percent market share, according to the DEDDIE/HEDNO data.

Among the independent suppliers, representing an overall 1.61 million low-voltage connections in September for a 23.6 percent share, Protergia, a member of the Mytilineos group, was at the forefront with a 4.07 percent share, or 277,000 customers, followed by Elpedison, with 3.75% and 256,000 connections, and Heron with 232,000 connections and a 3.41 percent share.

 

Five power suppliers fined for older debt to market operators

Five electricity suppliers have been handed fines by RAE, the Regulatory Authority for Energy, for outstanding debt to market operators totaling 347 million euros, energypress sources have informed.

The RAE board, which was preoccupied with the matter over at least three sessions, reached its decision at a crucial time amid the energy crisis, challenging the sustainability of energy companies.

Power utility PPC, the market’s dominant supplier, is believed to be among the five suppliers handed fines, along with four smaller players.

The five suppliers have agreed to letters of guarantee representing 50 percent of their debts owed to the operators and installment payment programs for settlement of remaining amounts over periods ranging from 8 to 10 months, sources noted.

RAE is expected to reexamine the progress of these payments in December, 2022.

Despite handing out fines, RAE is believed to be extremely concerned about the sustainability of energy suppliers, especially smaller players.

PPC unable to capitalize on lower-cost lignite production

Power utility PPC has found itself unable to take full advantage of current market conditions making lignite-fired power generation lower in cost compared to natural gas-fueled generation as the utility has winded down on maintenance levels at lignite units in anticipation of their expected full withdrawal by the end of 2023 as part of the country’s decarbonization plan.

The utility’s decreased maintenance of its lignite units has led to technical issues not enabling the facilities to operate at full capacity.

The profit margin for lignite-based generation has increased considerably but PPC is not able to significantly boost production for increased sales of lignite-based electricity generation.

Lignite’s share of the country’s energy mix is currently at single-digit levels, registering a 9 percent share in September, according to a recent monthly report released by power grid operator IPTO.

Electricity consumers unsettled, greatly increased return to PPC

An increased number of electricity consumers are switching suppliers, unsettled by the rising energy prices of recent months, the biggest gainer of this activity being power utility PPC, latest market data made available to energypress has shown.

The number of electricity consumers shifting suppliers increased by 50 percent in September, compared to the level in April. Specifically, 1.5 percent of the country’s electricity consumers changed supplier in September, up from one percent in April, the data showed.

Interestingly, the number of consumers returning to PPC, still the dominant player, more than doubled in September, compared to April. This trend is believed to have gained even further momentum in October.

The government’s role in presenting PPC as a safer, more socially conscious enterprise, as well as the company’s pricing policy, offering fixed tariffs, have been identified as the main factors behind this increased return of customers to PPC, market officials noted.

 

Gas spot market absence ‘key to higher wholesale electricity prices’

Greek gas market peculiarities and the non-existence of a spot market for natural gas were attributed as key reasons behind wholesale electricity market price differences between Greece and markets abroad, local electricity producers told RAE, the Regulatory Authority for Energy, following the authority’s request for explanations.

RAE held talks with representatives of power utility PPC, Mytilineos, Elpedison and Heron on the issue of wholesale electricity price levels.

The Greek gas market operates on a month-ahead model without the possibility for supply through spot markets, all four electricity companies told RAE.

At present, roughly half of the country’s electricity is generated by natural gas-fired power stations.

Electricity suppliers snub RAE’s tariff categorization proposal

Power utility PPC and the country’s independent electricity suppliers have responded negatively to a proposal from RAE, the Regulatory Authority for Energy, calling for the categorization of low-voltage electricity tariffs offered to households into three groups, low, limited and high risk, for fixed, partially restricted and floating tariffs, respectively.

According to the RAE proposal, made in related public consultation, consumers taking on greater risk would be offered lower base tariffs, which, however, would be fully susceptible to market forces and resulting fluctuations.

In its response, PPC noted that it agrees on the existence of two consumer categories, offering fixed and floating tariffs, contending further categorization could ultimately unsettle consumers and even prompt negative perceptions of company offers as a result of the use of the high-risk tag.

Mytilineos group, in its remarks, noted that labelling a fixed tariff as a risk-free option would deprive consumers of the opportunity and incentive to change consumption habits or adopt options related to energy efficiency and savings.

 

Foreign institutional investors hold 50% of PPC for first time

Power utility PPC is entering a new era following yesterday’s completion of the corporation’s equity capital raise, which lowers the Greek State’s share in PPC below 51 percent, to 34 percent, for the first time in the utility’s 70-year history. Foreign institutional investors now hold an overall 50 percent stake in PPC, up from 27 percent, while domestic stakeholders have a 16 percent share.

Greek governments will no longer be able to do as they please with PPC. Issues concerning management, policies, strategic decisions and new hirings will now require the approval of foreign investors at the general shareholders’ meetings. The Greek State will remain influential with its 34 percent stake.

The corporation’s new equity line-up promises to transform PPC into a far more efficient corporation capable of achieving more favorable terms in capital markets.

The Covalis and Zimmer funds, among the new multinational stakeholders, specialize in utility investments. Wellington is regarded as a highly selective fund, more so than Blackrock, also part of PPC’s new equity line-up.

PPC easily achieved its 1.35 billion-euro target through the equity capital increase. The business plan, approved on the eve of the equity capital increase, envisions investments worth 8.4 billion euros between 2022 and 2026, but the amount is now seen rising to 9.3 billion euros. Investments are planned in renewables, networks, Balkan investments and waste management.

More than half the sum of new investments, or 55 percent, is planned for the RES sector, both in Greece and abroad. A further 20 percent is planned for distribution networks, 7 percent for conventional energy sources, 4 percent for waste-to-energy units and 3 percent for retail concerns.

Geographically, 85 percent of PPC’s new investments will be made in Greece, and 15 percent in the Balkans, primarily in Romania and Bulgaria.

PPC equity capital raise ending, shares must now be distributed

Power utility PPC now faces the favorable predicament of having to decide on how to distribute shares to funds following the overwhelming response to the utility’s equity capital raise that attracted dozens of major international players.

The final value of the offers submitted is expected to be announced today from 4pm onwards, once the book building process has been completed. Yesterday, the tally was four times over PPC’s 1.35 billion-euro target. Some 3.5 billion euros in offers are believed to have been made by international investors.

PPC needs to distribute the equity capital raise’s new shares by November 10 so that they may begin trading on the bourse by November 16.

Funds that have stepped forward with official offers, all worth over 100 million euros each, include Oak Hill, Covalis Capital LLP, Ghisallo Capital Management LLC, Marshall, Schonfeld Strategic, Zimmer Partners LP, Graticule Asset Management, and Helikon Investments, which already holds a 6.48 percent stake in PPC.

The equity capital raise will increase the stake of private investors from 34 percent to 66 percent for a multinational line-up. It will offer the corporation fresh capital for its enormous investment plan. PPC is striving to implement an ambitious 5 billion-euro investment plan by 2024.

PPC equity capital raise a hit, funds must now be picked

Power utility PPC’s equity capital raise, whose ongoing book building process ends tomorrow, has already achieved its target, a 1.35 billion-euro sum with an upper share price of 9 euros, the sum of offers greatly exceeding this sum, and now finds itself faced with the  favorable predicament of having to decide which of the more than ten participating international major-scale funds will be given the biggest share packages.

Yesterday’s requests were worth a total of 3.2 billion euros, taking the procedure’s total amount of offers made so far to four times the 1.35 billion-euro target, which would have been inconceivable just a couple of years back.

The major international funds have submitted requests for share packages each worth over 100 million euros. PPC cannot satisfy them all and will have to decide which of these participants it considers most formidable and with long-term investment intentions. These will receive the share packages they have requested and the others will be given smaller stakes.

The equity capital raise will increase the stake of private investors from 34 percent to 66 percent and offer the corporation fresh capital for its enormous investment plan. PPC is striving to implement an ambitious 5 billion-euro investment plan by 2024.

The funds obviously see major investment returns over the next few years. PPC’s EBITDA is currently at 900 million euros but is forecast to rise to 1.73 billion euros by 2026 with net profit of 665 million euros and total turnover of 5.3 billion euros.

PPC makes waste-to-energy plans, RES moves worth €2bn in Balkans

Power utility PPC plans to develop waste-to-energy plants and also make RES investments in the Balkans worth two billion euros, a bulleting attached to the corporation’s ongoing equity capital raise, offering an update on the board’s strategic plan, has revealed.

The book building process, which began yesterday, will run until Thursday. Investors anticipate that PPC will enter new circular economy activities and also expand its green interests beyond Greece’s borders.

PPC expects to raise 1.35 billion euros through the equity capital raise, which will partially fund the corporation’s ambitious 5 billion-euro investment plan covering 2022 to 2024.

The power utility had initially announced a plan to enter the waste-to-energy sector in 2020 and is now reviving this part of its strategic plan.

This plan is in line with the overall national policy for waste management, developed in response to condemnation by European institutions of Greece for the country’s uncontrolled landfill management.

The power utility is expected to adopt advanced waste-to-energy technologies used in Europe’s north for the development of units making minimal environmental impact.

As for renewable energy, PPC has planned investments worth two billion euros between 2022 and 2026. Of this total, 820 million euros is planned to be invested between 2022 and 2024 and 1.11 billion euros from 2024 to 2026, according to the equity capital raise’s bulletin.

These sums are expected to be used for RES portfolio acquisitions. PPC is aiming for a green portfolio of 7.2 GW by 2024 to include extensive investments in the Balkans. Bulgaria and Romania are being targeted as markets of major potential.

 

PPC equity capital raise target reached in first hour of process

Power utility PPC’s equity capital raise objective, a 1.35 billion-euro sum, at 9 euros per share, was reached approximately one hour into the book building process, launched yesterday, sources informed.

This essentially means that the procedure’s shares will not be sold at a lower price (8.50 euros) but at the upper limit price of 9 euros per share.

The book building process will run until November 4. Shares will then be distributed to investors based on the offers they have submitted.

The equity capital raise is the first to staged by PPC twenty years after its bourse entry. An 85 percent proportion of the 1.35 billion-euro in capital is expected to be provided by foreign funds.

The equity capital raise will increase the stake of private investors from 34 percent to 66 percent and offer the corporation fresh capital for its enormous investment plan.

PPC is striving to implement an ambitious 5 billion-euro investment plan by 2024.

The Greek State’s share in PPC will drop to below 51 percent for the first time in the corporation’s 70-year history. However, the Greek State will maintain management as well as blocking minority rights.

 

EBRD commits €75-100m for PPC equity capital raise

Further highlighting the tremendous investor interest in power utility PPC’s equity capital raise, EBRD has signed to participate with capital of between 75 and 100 million euros, a move following a commitment by major fund CVC Capital to invest between 350 and 396 million euros for a 10 percent stake in the energy company.

The equity capital raise’s book building commences tomorrow with over ten institutional investors from abroad considered certain to participate.

CVC and EBRD have both signed agreements with PPC while a series of other interested parties have pledged to participate. These include Fidelity, Oakhill, Shroeders, Apollo, Bluecrest and Pictet.

Despite Blackrock’s extensive talks with PPC, as well as City and Goldman Sachs, coordinating the equity capital raise, this major fund may not participate for reasons not yet known, according to some sources. Until now, Blackrock’s participation was seen as certain.

The raise may attract as much as 1.35 billion euros, of which 85 percent, or 1.15 billion euros, is expected to be provided by foreign investors.

The equity capital raise will increase the stake of private investors from 34 percent to 66 percent and offer the corporation fresh capital for its enormous investment plan.

PPC is striving to implement an ambitious 8.4 billion-euro investment plan by 2026.

PPC equity capital raise’s share price, volume to be set today

The price level and volume of new shares to be offered through power utility PPC’s equity capital raise are expected to be finalized at a board meeting today.

The level of investor interest leading to the procedure has indicated that PPC may raise capital in excess of 1.2 billion euros, if reports pertaining to the issuance of between 130 and 140 million new shares are confirmed.

The equity capital raise will increase the stake of private investors from 34 percent to 66 percent and offer the corporation fresh capital for its enormous investment plan.

PPC is striving to implement an ambitious 8.4 million-euro investment plan by 2026.

 

 

Medium-voltage sector affected by wholesale price clause

Medium-voltage consumers face further power cost increases following the introduction of a wholesale price-related clause by power utility PPC, the main supplier to this category, which includes super markets and retail chains.

PPC was also forced to introduce a wholesale price-related clause for the low-voltage category in August, as a result of skyrocketing wholesale electricity prices.

Unlike rival power suppliers, who have adopted wholesale price-related clauses, the power utility had previously only included a CO2 emission rights clause in its supply agreements.

This latest energy cost increase could end up overwhelming some of the medium-voltage category’s energy-intensive consumers, defined as enterprises with energy costs representing at least 30 percent of their total business costs.

Costs for producers in Greece have risen by levels ranging between 20 and 40 percent, according to industry association Hellenic Production. The energy crisis is making stronger impact on producers in Greece as wholesale market negotiations for electricity are conducted through the intraday market, whereas most energy deals in other European markets are based on bilateral agreements at fixed prices, the association noted.

Even so, the energy crisis is being felt by industrial players throughout the continent. A group of eleven major producers representing various sectors, including steel and cement production, have urged EU leaders to take emergency action to counter the extreme energy cost increases, a major threat to post-pandemic economic recovery.

 

PPC equity capital raise, early November, to reach €1.1-1.2bn

Power utility PPC’s imminent equity capital raise, approved at yesterday’s general shareholders’ meeting and now set for the board’s approval, expected late October or early November, will inject a sum estimated between 1.1 and 1.2 billion euros into the company’s coffers, estimates have indicated.

Over the next ten days or so, PPC will continue promoting the equity capital raise to funds and institutional investors.

The equity capital raise will increase the stake of private investors from 34 percent to 66 percent and offer the corporation fresh capital for its enormous investment plan.

To date, the value of requests submitted by investors ahead of the book building process, expected late this month, has reached nearly two billion euros, triple the equity capital raise’s initial sum of 750 million euros.

The PPC board plans to meet either October 29 or November 1 to decide on the level of the equity capital raise, seen exceeding one billion euros, and also to approve it.

The book building process, to immediately follow, is expected within the first ten days of November.

Small-scale company shareholders expressed complaints during yesterday’s session, troubled by the prospect of being completely overshadowed, but PPC’s administration responded by noting they were free to take part in the upcoming equity capital raise.

Major funds, including CVC Capital and Blackrock, are believed to have requested big stakes during lead-up talks with PPC officials, while the overall investor interest is high.

 

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.

PPC shareholders meet today to approve equity capital raise

Power utility PPC is scheduled to stage a landmark general shareholders’ meeting today for approval of its imminent equity capital raise, which, once completed early next month, will increase the stake of private investors from 34 percent to 66 percent and offer the corporation fresh capital for its enormous investment plan.

The company board is anticipating complaints at today’s session from small-scale investors, mainly domestic shareholders troubled by the prospect of losing preferential shareholder rights.

Major international funds and institutional investors are preparing to move in and overshadow the smaller private investors. PPC has promised smaller shareholders will not be neglected.

To date, the value of requests submitted by investors ahead of the book building process, expected late this month, has reached nearly two billion euros, triple the equity capital raise’s initial sum of 750 million euros.

In response, PPC appears to have revised its equity capital raise, which could exceed one billion euros.

The strong investor interest is reflected by the company’s share price, which ended trading yesterday at €9.15, fully regaining losses incurred over the past three weeks.

Genop, PPC’s main union group, has announced strike action for today in protest against the equity capital raise, as well as a news conference.