Titan

Independent suppliers make slow but steady gains on PPC

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Independent electricity suppliers are slowly but steadily gaining ground on power utility PPC, the Greek retail electricity market’s dominant player, an annual market share report published by the energy exchange has shown.

PPC ended 2023 with a market share of 57.43 percent, down from 63.14 percent a year earlier, while the independent players gained ground for a collective market share of 42.57 percent at the end of 2023, up from 36.86 percent at the end of 2022.

These inversely related trajectories have generally been sustained since the launch of the target model in 2020. PPC has shed approximately 10 percent of its market share over this four-year period.

As for the country’s independent suppliers, Heron led the pack at the end of 2023, overtaking Protergia, the independent frontrunner in 2022.

In 2023, Heron, as supplier, gained two industrial consumers, metal processing company Viohalko and cement producer Titan. Both switched from PPC, which maintained its role as producer. Other industrial consumers also switched from PPC to rival suppliers, resulting in a sharp market share contraction for the power utility in the high-voltage category.

RES units in industrial PPAs for fast-track links reach 2 GW

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RES investors looking to benefit from a recent legislative revision offering connection-term priority to projects that have established PPAs with industrial consumers have until today to submit power purchase agreements to authorities.

RES projects signed up so far for PPAs with industrial consumers represent a total capacity of 2 GW, energypress sources have informed.

These PPAs include renegotiated agreements between power utility PPC and metal processing company Viohalko and cement producer Titan, for respective capacities of 520 and 300 MW, the sources noted.

Both Viohalko and Titan had signed PPAs with PPC prior to the energy ministry’s amendment offering connection-term priority to RES projects, but were renegotiated at the initiative of the two industrial consumers after they pointed out that new market conditions had been shaped by the legislative act.

According to sources, both Viohalko and cement producer Titan achieved deals well below the level of 56 euros per MWh agreed to for their original PPAs.

RES units without priority to be given 50% battery subsidies

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The energy ministry is working on offering an alternative form of support, through subsidies for battery installations, to RES projects linked with PPAs for industrial consumers should these projects miss out on priority status for appraisals of their connection-term applications.

RES units placed in Group B, in terms of priority, and not granted priority status for appraisals of their connection-term applications will, as a form of compensation, receive subsidies covering 50 percent of battery installations, the energy ministry has decided.

These batteries will be permitted to absorb energy from the grid, in addition to their respective RES units, thereby decreasing their investment cost.

The energy ministry has decided to grant priority status for connection-term applications concerning Group B RES projects whose output is intended to contribute to energy needs entailed in power utility PPC’s existing PPAs with metal processing company Viohalco and cement producer Titan.

RES projects planned to secure lower energy costs for farmers will also be granted priority status for their connection-terms procedures. A related legislative revision is expected to soon be submitted to Parliament.

 

PPA conditions altered by falling gas and electricity prices

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Falling natural gas prices and, subsequently, lower electricity prices, have brought about major changes to Greece’s renewable-energy PPA (power purchase agreements) market conditions, prompting industrial consumers and power suppliers to push for lower-priced PPAs.

Off-takers, or industry and power suppliers, are gaining an upper hand over RES producers in terms of price negotiations for prospective PPAs. RES producers are being forced to show greater price leniency in order to secure the development of new projects.

Given the natural gas and electricity price drops, existing ten-year PPAs established by power utility PPC with metal processing company Viohalko and cement producer Titan are also expected to be renegotiated as the price levels for these agreements, set at 56 euros per MWh, are no longer considered competitive.

Prior to the de-escalation of natural gas and electricity prices, PPAs virtually represented a life raft for industrial consumers and suppliers by offsetting exposure to high electricity prices and, more generally, considerable market volatility.

At present, natural gas prices on international energy exchanges have reached a three-year low, reaching 22.53 euros per MWh last Friday, and, in doing so, have also pushed down wholesale electricity prices, currently at levels of less than 100 euros per MWh.

Under such conditions, PPAs are no longer seen as a crucial. Instead, they have become irrelevant as the need for hedging has been significantly reduced or even eliminated. Market analysts do not see any upward price swing in the months ahead, a further de-escalation in gas and electricity prices seeming most probable.

 

Lower-cost farming electricity plan based on industrial PPAs model

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New government measures aiming to reduce energy costs for farmers have taken their cue from a PPA  pricing formula shaped by power utility PPC and agreed to with two industries so far – metal processing company Viohalco and cement producer Titan – for ten-year PPAs offering higher fixed tariffs over the first two years and lower-priced tariffs thereafter.

The government’s revision for agricultural-sector farming electricity, to be introduced April 1, almost exclusively applies to power utility PPC, as the company represents virtually all of the country’s 192,000 farming power meters.

PPC incorporated elevated fixed tariffs, for the first two years, into its PPAs with Viohalco and Titan as it anticipates such a time period will be needed for the completion of solar farms planned to serve the two industries.

Brussels set to approve state support plan for Prinos CCS

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The European Commission is set to approve Greek State funding support for Energean’s Prinos CCS project following the completion of a third round of exchange between Greece’s energy ministry and the Brussels authority on the issue, energypress sources have informed.

Pre-notification of the support scheme was announced last June, but this was followed by three rounds of consultation entailing questions which the Greek ministry was required to answer, in line with the European Commission’s CEEAG procedures concerning guidelines on State aid in the climate, environment and energy sectors.

The Prinos CCS project has been included on the sixth edition of the EU’s PCI/PMI list.

Greek gas grid operator DESFA has already received funding support worth 75 million euros through the REPowerEU program for the development of a pipeline to serve carbon capture units planned to be installed by cement producers Heracles and Titan at their respective facilities in Milaki, on the island Evia, and Kamari, in the Viotia region, slightly northwest of Athens.

DESFA’s pipeline will deliver emissions from the two production plants to a carbon dioxide liquefaction facility, which will also be built by DESFA but will not be supported by REPowerEU funding.

The liquefied emissions of the two cement plants will then be transferred for permanent storage at the Prinos CCS, an underground facility to be developed by Energean.

Talks have begun at a European level, as highlighted in a recent European Commission report, for the establishment of an extensive CO2 transport network by 2050.

According to the report, CO2 transport pipelines in the EU could reach up to 19,000 km by 2050 and will require investments of between 9.3 and 23.1 billion euros.

Greece is considered among the European countries that can potentially contribute to CO2 storage, the Prinos underground storage facility being pivotal to this potential.

Ministry determined to ensure PPAs for industrial consumers

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The energy ministry appears determined to ensure renewable-energy PPAs for industry and intends to incorporate all required measures into an overall plan being developed for the liberalization of grid space.

However, the ministry has a conundrum to resolve as it must combine increased grid-injection restrictions for RES units obtaining connection terms from now on with the need to keep prices low for PPAs involving RES producers and industry.

These increased grid-injection restrictions for RES units come as a challenge for renewable-energy PPAs already established, among them agreements between power utility PPC with metal processing company Viohalco and cement producer Titan.

Besides modifying RES output, these restrictions also affect data used by parties involved in PPAs to reach agreements on electricity purchase prices.

To offset negative impact, the ministry is considering to subsidize behind-the-meter battery additions to projects. This would enable RES producers to meet the energy needs of industries at latter dates should PV production exceed upper limits.

A subsidy-support solution would require the European Commission’s approval as it is considered a form of state aid.

 

REPowerEU: €75m for DESFA pipeline serving Prinos CCS

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Gas grid operator DESFA stands to receive funding support worth 75 million euros through the REPowerEU program for the development of a pipeline to serve carbon capture units planned to be installed by cement producers Heracles and Titan at their respective facilities in Milaki, on the island Evia, and Kamari, in the Viotia region, slightly northwest of Athens.

The pipeline will deliver emissions from the two production plants to a carbon dioxide liquefaction facility, which will also be built by DESFA but will not be supported by REPowerEU funding.

The liquefied emissions of the two cement plants will then be transferred for permanent storage at the Prinos CCS, to be developed by Energean.

The liquefaction facility will be located at a coastal area in the wider Athens area, one possibility being the islet Revithoussa. The choice of the location will be made once technical studies have been carried out by DESFA.

The project is planned to be developed concurrently with Energean’s Prinos CCS. The pipeline is planned for launch in 2026 following its completion late in 2025.

PPC retail market share drops 5 percent in September

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Power utility PPC’s retail market share shrunk by over 5 percent in September, compared to a month earlier, contracting to 53.49 percent from 58.69 percent, a drop mostly attributed to a three-way agreement between independent supplier Heron, PPC and cement producer Titan.

For this agreement, PPC signed a 10-year power purchase agreement with Titan for energy generated at PPC power plants that involves Heron as a third-party supplier.

It resulted in PPC shedding some of its market share in the high-voltage market and Heron gaining major ground.

Heron’s high-voltage market share rose to 21.3 percent in September from 11.2 percent in August, while PPC’s share fell to 48.1 percent from 58.5 percent, according to data provided by power grid operator IPTO.

Watt+Volt was another gainer in the high-voltage market, its market share in this category rising to 15.3 percent in September from 12.5 percent in August. Elpedison’s high-voltage market share fell to 11.6 percent from 13.4 percent.

As for the low-voltage category, PPC’s market share slipped to 63.1 percent in September from 65.1 percent August, but suffered a steeper drop, to 33.9 percent from 39.1 percent, in the medium-voltage category.

Most of the independent suppliers recorded overall retail market share gains in September. Heron’s overall market share rose to 11.59 percent, from 8.81 percent in August. Mytilineos’ market share increased to 8.42 percent in September from 7.75 percent in August. Elpedison’s market share rose to 6.16 percent from 5.81 percent. NRG’s rose marginally to 5.69 percent from 5.46 percent. Watt+Volt gained to reach 4.2 percent from 3.41 percent. Fysiko Aerio’s share rose to 3.4 percent from 2.96 percent. Zenith’s share contracted to 2.29 percent from 2.5 percent, and Volterra’s rose to 2.09 percent from 1.83 percent.

PPC initiates 10-year PPA with Titan, Heron serving as supplier

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Power utility PPC has reached an agreement for a 10-year power purchase agreement (PPA) with cement producer Titan, now the second industrial consumer to establish a bilateral energy supply contract with the utility, following metal processing company Viohalco.

PPC’s agreement with Titan, already activated, shares the same structure as the utility’s preceding deal with Viohalco.

As a first stage, the cement producer’s energy requirements will be covered by electricity generated at PPC power plants, both lignite-fired and and hydropower. A third-party supplier, energy firm Heron, will supply PPC’s energy output to Titan.

At a latter date, this PPA will develop into an entirely green-energy deal with all required electricity generated by PPC’s solar parks.

Heron’s involvement in the power utility’s PPA with Titan is expected to further increase the energy firm’s share of the high-voltage market.  It recently rose sharply to 11.25 percent following Heron’s involvement in PPC’s PPA with Viohalco.

Motor Oil, Titan CCS grants step towards value chain

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Energy group Motor Oil and cement producer TITAN have been selected for EU Innovation Fund grants, supporting innovative low-carbon technologies, for respective carbon capture and storage (CCS) initiatives taken by the two corporate groups.

Their selections promise to create opportunities for synergies and the development of a domestic value chain in the CCS sector.

For example, an annual sum of 1.9 million tons of CO2 to be captured at TITAN’s production facility in Viotia’s Kamari area, slightly northwest of Athens, will benefit Energean’s CCS project at its depleted offshore oil fields in the northern part of the Aegean Sea.

The Prinos CCS also stands to gain from Innovation Fund selection for cement industry Holcim’s production facility in Croatia, as Prinos is the nearest CCS facility. On a larger scale, the Prinos CCS can develop into southeast Europe’s first CCS facility catering to industry.

Motor Oil’s Iris project, concerning carbon capture at the energy group’s Oil’s refinery in Corinth, west of Athens, has been selected for a 127 million-euro Innovation Fund grant, it has just been announced.

This development gives Motor Oil the opportunity to greatly reduce its carbon footprint, produce 56,000 tons of blue hydrogen annually, and prepare the groundwork for e-fuel production, through the development and operation of a new low-carbon synthetic methanol production plant.

TITAN’s Ifestos carbon capture project, also just selected for an Innovation Fund grant, will enable the group to produce approximately 3 million tons of zero-carbon cement on an annual basis.

Legislative revision for PPAs submitted to Parliament tomorrow

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A legislative revision exempting energy bilateral agreements from a wholesale market cap, which will pave the way for PPAs promising industrial players fixed energy costs over long-term periods, is scheduled to be submitted to Parliament tomorrow ahead of a vote on Tuesday.

Once ratified, the new law, to either be introduced the very next day, on March 1, or by March 10 at the very latest, will enable the establishment of the country’s first PPAs.

Metal manufacturer Viohalco and building materials producer TITAN, the country’s two most energy-intensive industries, are expected to be the two first corporations to sign PPAs with power utility PPC.

Revision lifting PPA barriers for industry headed to Parliament

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The energy ministry is seeking a bill already in Parliament to table  an amendment designed to lift barriers currently preventing the establishment of bilateral power purchase agreements (PPAs) between power producers and large-scale consumers.

The amendment’s details were finalized at a meeting earlier this involving the participation of officials representing the energy ministry, RAE, the Regulatory Authority for Energy, the industrial sector and power utility PPC, sources informed.

Once the bill has been ratified, negotiations between PPC and energy-intensive industries for PPAs will be able to recommence after stalling as a result of the existing legal barriers.

“This intervention will ensure supply of competitively priced electricity [for energy-intensive industries]. Quantities will concern physical deliveries, while industries will be able to seek agreements with power producers for RES-generated electricity supply,” energy minister Kostas Skrekas was quoted as telling local business news publication Ikonomikos Tahidromos (OT) yesterday.

The amendment will primarily pave the way for PPC, the Greek electricity market’s dominant player, to sign PPAs with energy-intensive industries over long-term periods of between eight and ten years.

As has been previously reported, PPC is currently engaged in talks with the country’s two most energy-intensive industries, building materials producer TITAN and metal manufacturer Viohalco.

Revision exempting PPAs from wholesale market cap nearing

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February has so far been a good month for the industrial sector as, following Brussels’ approval of a remuneration mechanism worth 1.36 billion euros as compensation for a carbon tax, the first wave of green-energy power purchase agreements (PPAs), which promise to reduce energy costs for industrial producers, are not far away.

A legislative revision exempting green-energy bilateral agreements from a wholesale market cap is now on the final stretch. This exemption will pave the way for PPAs promising industrial players fixed energy costs over long-term periods.

The legislative revision’s final shape is just about ready, while its ratification in parliament is expected within the next few weeks, energypress sources have informed.

For quite some time now, power utility PPC has been involved in PPA talks with metal manufacturer Viohalco and building materials producer TITAN, the country’s two most energy-intensive industries.

However, these negotiations have been held back by the need for the legislative revision exempting energy producers from the wholesale market price cap for supply of PPA-related electricity quantities to energy-intensive customers.

PPC talks for first PPAs with industries concern thermal-green mix

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Power utility PPC’s ongoing negotiations with two energy-intensive industries for power purchase agreements (PPAs) entail ten-year electricity supply agreements at fixed prices, beginning with supply through thermal (lignite and gas) power stations for the first two or so years followed by RES-generated electricity, exclusively, for the rest of the agreement’s term, sources have informed.

According to latest information, metal manufacturer Viohalco and cement and building materials producer TITAN, the country’s two most energy-intensive industries, now without energy supply agreements as their previous deals expired at the beginning of the year, are the two industries discussing PPAs with PPC.

The power utility and the two energy-intensive industries are believed to now be discussing the fine details of prospective PPAs.

Any breakdown in these PPA talks is regarded as highly unlikely as the prospect of energy-cost stability over a ten-year period, at times of intense market volatility, is extremely appealing for the energy-intensive industries involved in the talks.

Government moves ahead with plan to reduce energy consumption

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The introduction of energy saving measures, both compulsory and optional, for consumers has now become a priority for the government following growing shortage fears, throughout Europe, prompted by Russia’s indefinite closure of the Nord Steam I gas pipeline, supplying Germany and, by extension, central Europe.

At a meeting of government officials in Athens yesterday, Prime Minister Kyriakos Mitsotakis agreed to move ahead with measures intended to restrict electricity and natural gas consumption in an effort to avoid energy shortages during winter, sources informed.

The government will aim to decrease the amount of natural gas used for electricity generation by approximately 10 TWh, sector officials told energypress.

Annual natural gas consumption in Greece amounts to 70 TWh, of which 50 TWh is used for electricity generation.

An initiative was taken in early July, through a joint ministerial decision, to reduce electricity consumption at all public buildings, numbering 212,000, by 10 percent. The response, so far, has been poor, according to sources.

Campaigns raising the public’s awareness of the need to cut back on energy consumption will soon be launched by energy companies and operators. Citizens will be advised to keep heating temperatures at a maximum of 19 degrees Celsius and lights switched off in rooms not being used.

The government is also striving to limit electricity and natural gas consumption in the industrial sector.

Energy minister Kostas Skrekas met yesterday with key industrialists at the helms of Titan cement group, Viohalco and the Mytilineos group, whose subsidiaries include Aluminium of Greece, to discuss plans limiting energy consumption, as well as the replacement of natural gas with diesel as an energy source wherever possible.

 

 

Key industrialists asked to cut down on energy consumption

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Energy minister Kostas Skrekas has asked a group of leading Greek industrialists to reduce energy consumption at their production facilities as a means of greatly contributing to the country’s wider energy-crisis effort ahead of what could be a challenging winter, energypress sources have informed.

The minister’s request, a response to Russia’s latest closure of the Nord Steam I gas pipeline, which, according to Moscow, was necessary for repairs, represents the start of the government’s gradual implementation of an emergency plan that factors in the possibility of a complete cut in Russian gas supplies.

The energy minister met last Friday with three industrialists, Dimitri Papalexopoulos, chairman of the executive committee at Titan cement group, Nikolaos Stasinopoulos, president of Viohalco, and Evangelos Mytilineos, chairman and board of the directors at the Mytilineos group, whose subsidiaries include Aluminium of Greece.

The minister, through this initiative, is striving for energy savings of approximately 15 percent as the production facilities of the three industrial groups are the country’s biggest consumers of electricity and natural gas.

Implementation of the minister’s plan is expected to help prevent power cuts to households and businesses. The three businessmen were also asked, by the energy minister, to avoid incorporating job cuts into their energy saving strategies.

 

 

Five hydrogen project proposals make cut for IPCEI contention

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Five Greek hydrogen production project proposals have been included in a first-round list submitted by the government to the European Commission for inclusion in its Important Projects of Common European Interest (IPCEI) category, reserved for projects promising important contribution to economic growth, jobs and competitiveness.

The five Greek project proposals, approved by energy minister Kostas Skrekas and development minister Adonis Georgiadis, were selected from 23 proposals submitted by companies for contention following an annoucement by the two ministries last April.

The short list of proposals is planned to be assessed by the European Commission in November for a place on the IPCEI list, ensuring EU support funds.

The list features the 8 billion-euro White Dragon project – involving the country’s biggest energy groups with gas company DEPA Commercial as head coordinator – for a hydrogen producing facility in northern Greece’s lignite-dependent west Macedonia region; the White Dragon-linked Green HiPo project of Advent Technologies; the H2CEM hydrogen project by cement producer TITAN; the BLUE MED project, for eco-friendly blue hydrogen production, by Motor Oil and gas grid operator DESFA; as well as the H2CAT hydrogen storage and transportation project by B&T Composites.

PPC industrial supply deals last act ahead of market share dive

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Power utility PPC’s latest supply agreements with industrial consumers, finalized just days ago with steel producer Viohalco, Titan cement and building materials group, as well as all other industrial players, following a preceding deal with Aluminium of Greece, a member of the Mytilineos group, represent, barring unexpected developments, the final act ahead of major market changes that will dramatically reduce the utility’s market share beyond December 31, 2023, when these new high-voltage supply agreements expire.

They are PPC’s last industrial supply agreements offering fixed tariffs. As of 2024, PPC will offer indexed tariff prices that will be pegged to the wholesale electricity market’s monthly clearing price in the day-ahead market.

This change will most likely prompt industrial consumers to seek alternative electricity supply solutions.

Aluminium of Greece has already done so, as it plans to receive electricity from the Mytilineos group’s new natural gas-fired power plant being developed in the Agios Nikolaos industrial zone in Viotia’s Agios Nikolaos area, northwest of Athens, to be direct cable-linked to the Aluminium of Greece facility, as well as through RES production, ending a 60-year association with PPC.

At present, PPC sells an annual electricity amount of between 63 to 64 TWh, of which approximately 5 TWh concern high-voltage electricity. If energy-intensive consumers leave PPC from 2024 onwards, to avoid indexed tariffs, the utility’s electricity sales will drop to between 58 and 59 TWh, and, by extension, its retail market share will contract to about 50 percent from 64 percent at present.

This is the state-controlled utility’s aim as an evenly divided electricity market in which PPC will hold a market share of about 50 percent and the independent suppliers the other 50 percent will end the DG Comp’s frequent interventions over the utility’s excessive retail market share.

The energy ministry is aiming for green-energy power purchase agreements (PPAs) to cover 20 percent of industrial electricity demand by next year.

 

Producers seeking lower-cost industrial electricity alternatives

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Industrial electricity consumers of the high and mid-voltage categories are securing lower-cost agreements with independent suppliers, while energy-intensive consumers, currently negotiating with power utility PPC for new tariffs to take effect January 1, are pushing for better deals.

These developments are reshuffling the industrial electricity market, previously dominated by PPC.

Independent energy company Heron and Macedonia Paper Mills (MEL) recently announced an electricity supply agreement that includes a package of services for energy efficiency, electromobility and RES coverage of the producer’s energy needs.

Cement producer Heracles had previously reached an electricity supply agreement with Protergia, a member of the Mytilineos group, paving the way for further agreements between producers and independent suppliers.

These developments have had a wider knock-on effect, including for mid-voltage supply, as demonstrated by an agreement between energy supplier NRG, a member of the Motor Oil group, with the country’s other cement producing giant, Titan.

Following losses in 2018 and 2019, PPC is believed to be turning its focus on more profitable sectors and is no longer interested in maintaining a high share of the industrial electricity market – both high and mid-voltage.

PPC, industrial firms begin talks for new supply deals, limits set

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Though still at an early stage, talks between power utility PPC and industrial consumers for new electricity supply agreements to become valid once current deals expire at the end of this year, already appear likely to require plenty of negotiating and time if current differences are to be overcome.

PPC has made clear it will not sell electricity at below-cost price levels to any customer. At the other end, industrial enterprises, each negotiating separately with the power utility, insist that a 10 percent price hike agreed to in March, 2019 for a three-year period covering 2018 to 2020 is unjustifiable as electricity production costs have fallen.

Besides price matters, the two sides also disagree on the duration of new deals. Industrialists are pushing for three-year agreements, covering 2021 to 2023, whereas PPC favors a shorter period. Insiders are predicting months of negotiations.

Industrialists are expected to seek quotes from PPC rivals. Vertically integrated energy groups that have secured competitive natural gas prices in recent months are in a position to offer lower electricity tariffs, regardless of fluctuations in the wholesale electricity market.

In July, wholesale electricity prices registered a level of 41.13 euros per MWh, down 34 percent from the equivalent month a year earlier.

Three industrial consumers, the cement producers AGET Heracles and TITAN and Macedonian Paper Mills (MEL), have been involved in talks with independent suppliers for high-voltage contracts.

Industrial consumers preparing to leave long-time supplier PPC

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Three of eight industrial groups traditionally supplied high-voltage power by power utility PPC and holding contracts that expire at the end of this year are involved in advanced talks with domestic independent suppliers for new supply contracts, energypress sources have informed.

PPC dominates the high-voltage electricity market with a 97 percent share, but this figure could drop considerably if industrial consumers reach agreements with new suppliers.

Leading cement producers AGET Heracles and TITAN, as well as Macedonian Paper Mills (MEL), are the three industrial consumers involved in talks with independent suppliers for high-voltage contracts, the sources noted.

All three have never before held contracts with any other electricity supplier, but their shifts away from PPC, probably not concurrently, now appear highly probable. Such a development would signal the start of competition in Greece’s high-voltage electricity market.

Lower wholesale prices, which have widened profit margins, as well as lower natural gas prices lowering generation costs at gas-fired power stations operated by independent producers, are key factors behind the likely shifts of industrial consumers to independent suppliers.

Industrial producers, gearing up for the post-coronavirus era, are seeking lower energy costs but are not satisfied with the tariff levels offered by PPC, market officials have noted.