KEN official: ‘Let’s first utilize existing interconnections’

Electricity interconnections reduce risk and prices but the country’s existing potential and interconnections are not being fully utilized, Yiannis Psarros, the crossboundary trade manager at independent supplier KEN, noted in an interview for local business news channel SBC’s Energy Week show, hosted by energypress journalist Thodoris Panagoulis.

“Let’s utilize these [existing interconnections] first and then look at developing new ones, such as the Cretan interconnection, Eurasia and Euroafrica,” Psarros remarked. “Our country depends greatly on interconnections,” he added.

Electricity suppliers in Greece are currently absorbing elevated wholesale prices but it remains questionable as to how long they can keep doing so, the KEN official explained.

Inadequate rainfall and an increase in oil prices have driven up wholesale electricity prices, compared to recent levels in Europe and the Balkans, Psarros pointed out.

Psarros described the NOME auctions – introduced in Greece slightly over a year ago to offer independent suppliers access to the main power utility PPC’s low-cost lignite and hydropower sources – as a transitional measure that cannot be relied on for favorable market conditions in the future.

Until now, NOME auctions have helped the market remain afloat but made minimal impact in terms of independent supplier growth through a contraction of PPC’s dominant market share, the KEN official remarked.

He admitted current market shares of independent suppliers would have been lower had NOME auctions not been introduced. Also, extraordinary situations such as last winter’s energy crisis would have proved devastating without the NOME auctions, he added.

Psarros described the bailout-required contraction target set for PPC as ambitious – given the measures implemented to date. PPC’s retail electricity market share, still at about 83 percent, needs to drop to less than 50 percent by 2020.

The KEN official expressed satisfaction with the newly emerged company’s performance over the past nine months. KEN now operates 19 retail outlets and is one of the two or three fastest growing suppliers in terms of new customer arrivals, stressed Psarros, who also made note of the independent supplier’s establishment of a crossboundary trade division.

He expressed reservations over next April’s target starting date for the Greek energy exchange but admitted serious work is being carried out for its launch.

“The energy exchange promises to introduce a futures market, in other words, each player will be able to buy and sell future-term energy. It’s a usefool tool,” Psarros said, adding consumers stand to benefit from the resulting competition.