Greek government officials are awaiting responses on proposals submitted to the lender institutions, including the European Commission, for demands in the energy domain, primarily electricity sector revisions.
Although there appear to be no major problems with Greece’s proposals concerning the NOME auctions, the permanent CAT mechanism, the “disruption management” plan, to enable energy cost savings for major-scale industry in exchange for shifting energy usage to off-peak hours whenever required by IPTO, the power grid operator, the Variable Cost Recovery Mechanism, to prevent certain power stations from operating below cost by helping cover their start-up costs whenever they are called into action to help meet the grid’s needs, and new industrial sector tariffs, a problem has emerged on the temporary CAT plan, intended to offer retroactive pay to producers for output in 2015.
This is how energy minister Panos Skourletis described the latest picture on reforms yesterday.
As energypress has previously reported, lenders disagree with the temporary CAT plan’s retroactive payments, claiming these will be regarded as state aid.
However, solid progress is reportedly being made for the permanent CAT mechanism. It is believed the entire month of November will be needed to complete this reform, a time-consuming one.
As for the NOME auctions plan, intended to offer wholesalers access to main power utility PPC’s low-cost lignite-fired electricity production as a means of reducing the vertically integrated utility’s market dominance, lenders appear to have accepted Greece’s proposal of skipping a near-term objective of reducing PPC’s market share by 25 percent and instead focusing on the plan’s longer-term target of reducing the utiliy’s share to below 50 percent by 2020, from 94 percent at present.
Public consultation procedures for the Variable Cost Recovery Mechanism plan were launched by RAE, the Regulatory Authority for Energy, last Friday.
A ministerial decision is reportedly ready for the “disruption management” plan and will soon be delivered. As has been reported, renewable energy sector (RES) producers will be greatly burdened by this mechanism. However, household and small-scale PV systems may be given preferential treatment.