ENERGY

Electricity cost-cutting plan

Ministry prepares measures for local energy-intensive industries to become more competitive

electricity-cost-cutting-plan

The Energy Ministry is preparing to tackle the high cost of energy for local industry, one of the Greek economy’s biggest problems, by seeking instruments in the new model of the electricity market; this will be done in such a way as to also promote the energy transition to cleaner fuel.

Keeping electricity giant Public Power Corporation (PPC) and the pricing policy the utility is negotiating with its major industrial clients at arm’s length, the ministry is promoting – in cooperation with the Regulatory Authority for Energy and the grid operating and administrating companies (ADMIE and DEDDIE) – the reduction of system and grid usage fees for medium- and high-voltage enterprises, as well as three more interventions.

“Greek industries pay 20% more for their power than their European competitors, and we will resolve that with new instruments, in the context of a new industrial policy that is not dependent on PPC, an independent enterprise,” Minister Kostas Skrekas told Kathimerini.

The first intervention, which mainly concerns the slashing of energy costs for small and medium-sized enterprises in all sectors, is associated with energy saving actions that will be financed with 1 billion euros from the Next Generation EU fund.

The second move, which constitutes the pillar of the ministry’s overall intervention, has to do with the green bilateral power purchase agreements (PPA) between large energy consumers and renewable energy source (RES) producers. The ministry’s plan provides for the creation of wholesaler consortiums of RES producers to sell contracts that will be 50% subsidized through the existing RES compensation system, which effectively constitutes state PPAs. This will be submitted to Brussels for approval by June.

The third action to cut costs for energy-intensive industries will come from the mechanism of strategic reserves that the ministry will also submit for approval by June. This mechanism will incorporate the production units that will stay off the market except for times of peak demand.