ECONOMY

The battle begins for the spoils of power

The institutional deregulation of Greece’s energy sector, completed last year, has been heralded by Development Minister Dimitris Sioufas as a great opportunity and challenge for the country’s economy. The government has been looking forward to a massive influx of investment, particularly from foreigners, in modern power plants. Unfortunately, bureaucratic delays, combined with a cumbersome Public Power Corporation (PPC) which was effectively ruled by the trade union establishment until just a few months ago, have turned the country’s great opportunity for advancement into an El Dorado for powerful business interests in partnership with foreign giants. The first tender of three that are to be called for the construction of privately operated power plants, each of which will be fired by natural gas and have a capacity of 300 megawatts, was completed last month and the Kopelouzos group, in partnership with Italy’s ENEL, looks like the winner. The conflicting interests in the other two tenders are as follows: – Kopelouzos is a rival of the Mytilineos group – a partner of Spain’s Endesa but also of ENEL – in the tender for the construction of PPC’s new plant at Aliveri on the island of Evia. – The Vardinoyiannis group, in partnership with Spain’s Iberdrola is proposing construction of a power plant at Aghioi Theodoroi, next to its oil refining plant west of Athens. – Construction firm Hellenic Technodomiki is in partnership with Italy’s Edisson and France’s EOF. The rival groups have already taken up position and the battle is expected to be hard. One initial consequence has reportedly been unrelenting pressure on the government, in view of the precious spoils: Hellenic Petroleum’s power plant in Thessaloniki sells power for -70/kWh, against PPC’s average -35/kWh. Mytilineos is also pressing hard to sell at the same price, when the group buys from PPC for -40/kWh for its alumina plant. Sioufas is resisting hard: «As long as I am minister, there will be no arbitrage in electricity.»