Public Power Corporation is launching a counterattack in the retail market, expanding its activity to the provision of natural gas too.
Probably before the end of this month, the electricity giant aims to start offering combined packages of power and natural gas at competitive rates, reversing the outflow of its customers which had started to grow following the recent electricity rate hikes.
The utility’s previous administration had begun planning for PPC’s penetration of the gas market. It had applied for the required license and that was approved by the Regulatory Authority for Energy in April 2018.
The objective of the plan is the offsetting of losses from the reduction in its electricity market share. It was actually McKinsey, the consultant PPC had commissioned, which advised the utility to enter the gas market, through a strategic plan it drafted.
This expansion to the gas market improves PPC’s portfolio and concerns its gas-fueled production units and the procurement of two liquefied natural gas (LNG) loads this past summer. The loads were brought to Greece for PPC by Shell and Eni following international tenders, while Greek company Mytilineos, which won the relevant tender last week, will bring an LNG load to the Revythousa terminal for PPC on November 16.
That new load, with a capacity for 650,000 megawatts hours, means that, according to international LNG rates, PPC will have a benefit of around 5.5 euros per MWh compared to the gas it receives from Public Gas Corporation (DEPA).
The low LNG rates, which have already been utilized by other producers, will also allow PPC to improve its fuel portfolio and to offer its power consumers more competitive rates.
Furthermore, given its huge client base, PPC expects to grab a gas retail market share of up to 30 percent; this is a market that may have opened up but is practically run by a duopoly comprising ZeniTH and Attica Gas: These two companies account for 95 percent of the market, thanks to the monopoly they enjoyed in their local markets before the liberalization. Mytilineos holds 2 percent, while Elpedison, NRG and Heron have 1 percent each.