Spain, Portugal price cap agreement to guide Greek plan

Spain and Portugal’s agreement with the European Commission for the implementation of a temporary cap of 50 euros per MWh on reference prices for natural gas and coal used by power plants, effectively detaching wholesale electricity market prices from the cost of these generation sources, promises to serve as a guide for Greece’s negotiations with Brussels for intervention in the country’s wholesale electricity market.

Spain and Portugal had requested a temporary cap on reference prices of 30 euros per MWh, for one year.

The price of electricity in Spain and Portugal will be the same as that applicable for transactions with the rest of the EU, via France, El Pais reported.

The limited capacity of the Iberian Peninsula’s electricity grid interconnections with France will restrict electricity exports from Spain and Portugal. Otherwise, lower electricity prices resulting from the temporary cap would have prompted a sharp rise in electricity exports from Spain and Portugal.

Though the Greek government is on standby for a European price-cap solution to the energy crisis, Athens has already begun regulatory and legislative preparations for domestic market intervention.

Sweden’s OX2 buys 500-MW RES portfolio, eyeing further moves

Swedish company OX2 has acquired wind and solar energy projects in Greece with a total capacity of 500 MW, a development that serves as a reminder of the steadily growing interest of European and international investors in the country’s RES market.

OX2 already possesses an extensive past in the Greek market, having collaborated with local companies to develop RES projects offering a total capacity in excess of 4 GW, the Swedish company has pointed out.

Further details on the deal’s seller, or sellers, have not been disclosed, but it is understood OX2’s acquisition concerns projects that are currently at different stages of development in various parts of Greece.

The Swedish company is preparing to assemble a team in Greece comprised of personnel from the Greek market as well as employees already with the company, sources have informed energypress.

OX2 plans to also examine further investment opportunities in the Greek market and is eyeing offshore wind farm, energy storage and hydrogen-related investments, a top-ranked company official has told energypress.

“Greece is a very interesting market for OX2. Approximately 20 percent of energy consumed is imported and 15TWh of lignite-fired power will be replaced by 2028,” noted Paul Stormoen, chief executive officer at OX2. “The country has strong sources, serious prospects for development of green energy projects, and plans to install over 5 GW in solar units and more than 3 GW in wind units by 2030. OX2 is aiming for a long-term presence and can accelerate the energy transition by utilizing its high expertise in the development of RES projects,” he continued.

Last year, OX2 formed subsidiaries in Romania and Italy and also developed a solar energy hub in Spain. The company is active in ten European markets.

 

Athens, Europe’s south hoping for brave crisis decisions

Athens, along with other EU administrations, especially in Europe’s south, will be hoping for a brave European response to the energy crisis’ exorbitant prices at this week’s summit of EU leaders, scheduled for March 24 and 25.

Prime Minister Kyriakos Mitsotakis has joined forces with his counterparts from Italy, Spain and Portugal ahead of this week’s summit. The four leaders are hoping action, rather than just good intentions, as expressed by Europe’s north during an unofficial meeting a fortnight ago, will be taken.

That session highlighted a lack of agreement on the issue of a Eurobond as a common solution to help consumers in Europe cope with extremely higher energy prices.

Some analysts believe long negotiations could be needed at the forthcoming summit, as was the case in 2020, when European leaders worked for five days to eventually approve the Recovery and Resilience Facility as a means of helping economies bounce back from the impact of the pandemic.

Other analysts fear US president Joe Biden’s participation in the concurrent EU-NATO conference will overshadow talks for energy market intervention, postponing needed action for a next session.

 

 

EU south, uniting, anticipates drastic energy cost measures

Europe’s south is pushing for drastic European Commission action in the hope that soaring energy prices can be countered as the endurance of consumers in less robust European economies continues to diminish,  prompting fears of an increase in unpaid receivables, energy company closures, even social unrest, if prices do not de-escalate within the next few months.

The European Commission, gearing up for its next summit, on March 24 and 25, is believed to be preparing to present a series of measures intended to tackle skyrocketing energy prices.

If decisive, these European Commission measures would be embraced by EU member states, especially in the south. If the measures remain half-hearted, in the hope of favorable market developments during spring, they will prompt disappointment, possibly even rebellion, within the EU.

The leaders of Greece, Italy, Spain and Portugal plan to meet in Rome either this week or next to establish a common line ahead of the upcoming EU summit.

The precise nature of the European Commission’s upcoming measures has yet to be disclosed. Wholesale natural gas market intervention, with or without price ceilings, as Greek Prime Minister Kyriakos Mitsotakis has proposed, is a possibility. A detachment of electricity prices from natural gas prices, as proposed by Athens and Madrid, is another possible measure that could be announced by Brussels.

The likelihood of a Eurobond issue to help cover the energy needs of consumers in the EU appears to have faded following recent talk of such a solution.

Brussels to propose windfall profit support for consumers

The European Commission, fearing the energy crisis will be prolonged, is moving towards adopting a French EU presidency proposal that would offer energy consumers support through redistribution of windfall profits earned by electricity producers in the RES, hydropower, nuclear and lignite sectors.

The European Commission strategy also includes a call for regulatory intervention to contain retail electricity prices.

The Brussels proposal, contrasting the European Commission’s energy-crisis stance until now, is included in a preliminary plan that was due to be officially announced next month but has been leaked by the EURACTIV media outlet.

Spain has already taken similar-minded action by taxing excessive earnings generated by nuclear power stations and large-scale RES facilities.

Europe’s south wants wholesale price to reflect energy mix cost

Greece will align with a French proposal for wholesale electricity prices as a reflection of energy-mix cost, not energy exchange levels, a stance to be adopted by countries of Europe’s south, at a council meeting of European energy ministers today.

France will join forces with Greece, Italy, Romania and Spain, Barbara Pompili, Minister of Ecological Transition, has informed ahead of today’s session, for their presentation of a joint proposal to the EU 27 for wholesale electricity market reforms.

The proposal’s objective will be to offer consumers better protection against excessive price increases as well as stability through the energy transition period.

It remains unclear how the French-led proposal will be received by other EU member state representatives.

Europe’s north, better equipped to handle adverse market conditions as a result of more diverse energy mixes and numerous grid interconnections, enabling greater flexibility, has been less affected by the energy crisis and, subsequently, is not under pressure to seek market reforms.

However, governments around the continent are feeling growing pressure as wholesale price levels appear to be establishing themselves at higher levels, impacting inflation rates around Europe, latest Eurostat figures for November have shown.

In Greece, wholesale electricity prices have held steady at record-breaking levels above 260 euros per MWh over the past few days.

Greece tables hedging fund plan to soften energy crisis

Energy minister Kostas Skrekas has proposed the adoption of a temporary hedging mechanism by EU member states as a means of easing the burden of increased electricity costs on consumers.

The minister’s proposal, which would enable funds to be drawn from the Emissions Trading System through extraordinary auctions offering additional carbon emission rights or prepayment of potential ETS revenue, was tabled at a meeting of EU energy ministers in Ljubljana yesterday.

The ministers assembled in search of a solution to counter the relentless rise in carbon emission right costs.

Skrekas’ proposal is similar to household mitigation measures recently announced by the Greek government for which electricity subsidies will be financed by revenues generated at carbon emission right auctions, through the Energy Transition Fund.

According to estimates by Greek officials, a sum of between 5 and 8 billion euros will be needed to cover the EU’s overall energy support needs this coming winter. Distribution of this amount to member states would take into account respective electricity consumption levels, heating needs and GDPs.

At the Ljubljana meeting, Greece, Spain and Italy were the only member states to propose the adoption of EU-wide measures as an effort to restrict the effects of the energy crisis, seen worsening for households and businesses this coming winter.

 

Brussels strategic reserve conditions discussed by RAE, IPTO, ministry

A new adequacy report and a new market reform plan, two conditions set by the European Commission for Greece’s adoption of a strategic reserve mechanism, have been discussed during an online meeting between RAE, the Regulatory Authority for Energy, power grid operator IPTO, and the energy ministry.

The European Commission’s Vice-President Margrethe Vestager, also Brussel’s Commissioner for Competition, during a preceding meeting, earlier last week, with energy minister Kostas Skrekas, called for a new adequacy report, in other words, an updated study proving the country’s need for a strategic reserve mechanism to cover actual grid needs.

The Brussels official also requested a new market reform plan detailing reforms designed to intensify competition in the wholesale electricity market.

Pantelis Kapros, Professor of Energy Economics at the National Technical University of Athens, has been asked to contribute to this new market reform plan, sources informed.

Besides the strategic reserve mechanism, RAE, IPTO and energy ministry officials also discussed details on prospective power purchase agreements (PPAs) between industrial enterprises and RES producers.

Vestager, at her meeting with Skrekas, the energy minister, recommended that Greece follow the examples of PPA models adopted by other EU member states, such as Spain.

Greece climbs up to 12th place in EU electricity tariff cost rankings

Greece has climbed seven places, to 12th from 19th, in the EU rankings for retail electricity cost, pushed higher by a government decision reached last year to increase tariffs at state-owned power utility PPC, according to latest Eurostat data.

These tariff hikes at PPC were imposed by the government in August, 2019 to protect the utility from falling into bankruptcy.

The EU rankings concern electricity price levels for household consumption levels between 2,500 to 5,000 kWh, annually.

Electricity tariff increases for households in Greece rose by an average of 8.6 percent in the first half of 2020, compared to the previous half, when the country was ranked 19th.

The first-half tariff price for households averaged € 0.129 per KWh, not including taxes and surcharges, up from €0.1189 per KWh in the second half of 2019.

PPC remains Greece’s dominant supplier, representing 63 percent of electricity consumption.

The PPC tariff increase has made electricity more expensive in Greece than in countries with higher income per capita levels. Electricity is now more expensive in Greece than in France (€ 0.1247 per KWh), Finland (€ 0.1178 per KWh), Spain (€ 0.1178 per KWh) and Sweden (€ 0.1130 per KWh), all with higher income levels. Electricity is also more expensive in Greece than in Portugal (€0.1139 per KWh).

Despite the country’s rankings rise, electricity prices in Greece remain below the EU average (€0.1327 per MWh), a result of the competition generated by independent suppliers, subduing prices.

The biggest electricity tariff decreases in the first half of 2020, compared to the previous six-month period, were recorded by the Netherlands (-31%), Latvia (-12.8%), Slovenia (-11.4%), Sweden (-10%) and Estonia (-8.9%), the Eurostat data showed.

Electric vehicles bill to include production line incentives

A draft bill being prepared by the government to promote growth for Greece’s embryonic electric vehicle sector will not only include incentives for buyers and users but also producers, energypress has been informed.

Producers establishing production lines for electric vehicle parts, including batteries, transformers and recharging units, will be offered incentives in the form of lower tax rates and reduced social security system contributions for employees, the sources said.

However, eligibility for these incentives will be conditional and require producers to establish their production facilities in either northern Greece’s west Macedonia region or Megalopoli in the Peloponnese, both lignite-dependent local economies headed for decarbonization.

The incentives are expected to include subsidies of between 4,500 and 5,000 euros for purchases of zero or low-emission electric cars, approximately 1,000 euros for electric scooters and 800 euros for electric bicycles.

Government officials plan to submit the draft bill on electric vehicles to Parliament in June.

Besides seeking to promote industrial development in current lignite areas, the master plan will also aim to make the most of early interest expressed by foreign investors.

One of these, Tesla, has, for months now, expressed interest to the Greek government for development of a fast-recharge network at Greece’s highways, a project budgeted at 10 million euros. This project is envisioned as part of a wider plan stretching from Portugal to Spain, France, Italy, Greece and Turkey.

JinkoSolar delivers 950 MW of modules for X-ELIO projects in Spain, Mexico

JinkoSolar, one of the largest and most innovative solar module manufacturers in the world, has announced a 950-MW delivery to X-ELIO, a leading company dedicated to the development, construction and operation of photovoltaic plants, of its ultra-high efficiency Cheetah 72 cells solar modules to be installed at different projects across Spain and Mexico.

Out of the 950 MW to be installed, 575 MW of the PV panels will be used in 12 project sites, namely in Spain, including Ciudad Real, Badajoz, Albacete, Murcia, Almería, Sevilla, Cartagena, Valencia and Segovia, while over 375 MW will be deployed in two different project locations in Mexico, with 118 MW and 257 MW destined for Veracruz and Navojoa, respectively.

“We are very pleased to have gained the trust and confidence of X-ELIO, one of the most professional and experienced developers and investors in the PV industry,” commented Kangping Chen, CEO of JinkoSolar. “Supplying their large-scale pipeline projects in Spain and Mexico with our ultra-high efficiency PERC Mono modules has allowed us to significantly expand our share of the Spanish and Mexican PV markets this year. It has always been our mission to be recognized as the most reliable global module supplier, which is driven by our commitment of delivering high-quality products and exceptional customer service. It is this commitment that allows us to develop deep and long-lasting relationships with respected partners such as X-ELIO.”

X-ELIO, firmly committed to greenhouse gas reduction and the fight against climate change, has built more than 1.6 GW in solar photovoltaic plants and currently has 41 solar plants in operation.

 

JinkoSolar to supply 300 MW of ultra-high efficiency modules for Spanish project

JinkoSolar, one of the largest and most innovative solar module manufacturers in the world, has signed a module supply contract with METKA EGN, a world-class EPC contractor, for 300 MW of JinkoSolar’s ultra-high efficiency Cheetah modules to be installed at a large-scale solar power plant, the Talasol project, in the municipality of Talaván, Cáceres, Spain, the company has announced.

“Cheetah modules are widely accepted by the market and have become industry standards. We are delighted that METKA EGN, one of the most professional and experienced EPCs developers globally, has once again placed their trust in the superior quality and reliable performance of our solar modules for this impressive new project in Spain. The Talasol project will create a benchmark in Europe in terms of competitively-priced and subsidy-free solar power. It is also one of the largest utility scale projects ever built in Europe and JinkoSolar is very proud to be a part of such a milestone,” said Frank Niendorf, General Manager of JinkoSolar Europe.

Nikos Papapetrou, CEO of METKA EGN commented: “The 300 MW Talasol project is a landmark venture not only in Spain, but for the whole of Europe. We have our full trust in JinkoSolar, one of the leading companies in the solar industry, as our strategic module supplier and are confident that they will deliver their high-performance, durable and reliable modules on time which will help produce long-term sustainable renewable energy.”

 

ICSID support for Spanish RES investors may impact Greece

Setting a clear precedent in Spain and beyond, including Greece, where predetermined feed-in tariffs for renewable energy producers have been retroactively reduced, the International Center for the Settlement of Investment Disputes (ICSID) has delivered a decision against Spain, ordering the country to make a 128 million-euro compensation payment, plus interest, to Eiser Infrastructure Limited and its subsidiary Energia Solar Luxemburg.

The retroactive reductions of predetermined tariffs offered to investors in Spain for RES output are an infringement of Article 10 of the Energy Charter Treaty and its fair and equitable treatment regulation, according to the ICSID decision.

A large number of Spanish RES producers have filed cases claiming substantial compensation amounts for retroactive tariff reductions concerning existing RES units.

This ICSID development could impact measures included in Greece’s new deal, aiming to solve LAGIE’s (Electricity Market Operator) deficit problem. It includes feed-in tariff cuts for producers in exchange for bank loan extensions and interest rate reductions.

Spain’s energy ministry has announced that the government is considering appealing the ICSID decision, fearing it could prompt more affected RES investors to take related legal action and seek damages.

Eiser Infrastructure Limited had joined forces with Spanish energy investment company Elecnor and construction company Aries to develop solar energy production stations in the cities Ciuadad Real and Badajoj in 2007. These investments were worth a total of 935 million euros.

Favorable RES sector conditions, legislated in Spanish parliament before being overturned by the tariff cuts, served as an incentive for this investment decision.

Contrary to the ICSID, the Supreme Court in Spain, citing various reasons, has rejected claims made by RES producers. The court has noted that the unpredictability of actual RES market conditions justifies the tariff revisions.