recovery fund

Key energy infrastructure included in new recovery fund

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The government, intending to make the most of its favourable geographic location for diversified natural gas supply in the wider region, plans to seek EU funding support, through the REPowerEU package, for a series of natural gas and electricity grid projects awaiting development.

These projects are planned to be included in the country’s revised EU Recovery and Resilience Facility, to be submitted to by the government to the European Commission by early July.

The investments will aim to end Greece’s reliance on Russian energy sources by 2027, as planned by the REPowerEU package.

Besides the addition of natural gas infrastructure, absent from Greece’s existing recovery plan as a result of the European Commission’s unfavorable view on funding support for projects concerning natural gas, seen as a transitional energy source towards zero emissions, the country’s revised plan will also seek to incorporate electricity transmission projects that will contribute to the reinforcement of renewable energy sources in Europe’s energy mix.

The government is believed to have already prepared its catalogue of electricity and natural gas infrastructure project proposals to seek funding through the REPowerEU initiative.

An electricity grid interconnection project to link the Greek and Egyptian systems and transmit green energy, exclusively, to Greece and the EU has been included in the Greek catalogue, sources informed.

An additional central gas pipeline, to run 650 km from Komotini, northeastern Greece, to Elefsina’s Patima area, west of Athens, has also been included in the Greek catalogue, following a request by DESFA, the gas grid operator.

Government considering price ceiling on retail electricity

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The government is considering to impose a price ceiling on retail electricity, but decisions may depend on the outcome of the next EU summit, scheduled for May 30 and 31.

Even so, the Greek government will be prepared to act alone if EU leaders fail to reach decisions concerning the energy market at the next summit, Prime Minister Kyriakos Mitsotakis pointed at last week’s Delphi Economic Forum.

This would entail further support packages to help consumers meet sharply higher energy costs in the ongoing energy crisis, showing no signs of ending.

It is believed that a sum of between 2 and 4 billion euros will be needed to cover energy subsidies in Greece over the next 12 months. Government sources have yet to specify, but have already described the amount to be required as “considerable”.

Some of the funds could be provided through the Recovery and Resilience Facility.

 

IPTO grid projects set to receive €195m in recovery fund support

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Two major grid projects planned for development by power grid operator IPTO in order to boost the country’s grid capacity and energy security are set to receive a total of 195 million euros in funding through the recovery and resilience fund, following a joint ministerial decision by the energy and finance ministries.

The joint ministerial decision secures financial support, through the recovery and resilience fund, for the fourth and final phase of the Cyclades interconnection and reconstruction of the Koumoundourou high-voltage center along with a 400kV line linking the facility with the Corinth high-voltage center, west of Athens.

The two projects are budgeted at a combined total of 482 million euros. The fourth phase of the Cyclades interconnection, budgeted at 393 million euros, is expected to receive 165 million euros through the recovery and resilience fund.

The Koumoundourou high-voltage center, whose budget is estimated at 89 million euros, is expected to receive 30 million euros in financing through the recovery and resilience fund.

Interest rate subsidies for competitive RES projects

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RES projects deemed competitive, based on tariff levels, will be entitled to loan interest rate subsidies as compensation covering the gap between rates offered in the Greek market and far lower European rates, deputy finance minister Theodoros Skylakakis has informed.

The deputy minister offered the update at a presentation yesterday of the National Bank of Greece’s “Ethniki 2.0” plan through which the bank will offer an extensive range of financing services to investors, small, medium and large enterprises opting to utilize various investment benefits offered by the country’s recovery fund, dubbed Greece 2.0.

The subsidy support covering the interest rate gap will be made available for new projects to be developed following the launch of Greece 2.0 support programs, the deputy minister clarified.

Skylakakis stressed that only competitive RES projects will be eligible for these subsidies, the logic behind the support being to cover the financing cost disadvantage faced by RES investors in Greece compared to investors of this domain in other parts of Europe.