Renewables account turns red in Greece amid more low and negative power prices

Conditions in the Greek market have worsened in recent months for renewable energy producers, especially in the solar power segment, as a result of low and negative electricity prices.

So far in September, the total number of hours with a negative price in the day-ahead market (DAM) has reached 27. Prices usually fall slightly below zero, between EUR 0.01 per MWh and EUR 1, but for Sunday, September 21, they reached a negative EUR 14.8 per MWh.

In Greece, over 7 GW of renewable electricity plants with individual capacities above 400 kW operate under contracts for difference (CfDs).

Negative prices hurt producers. They receive no payment if the price is zero or below for two or more consecutive hours.

Low positive prices harm market operator

There is another issue, caused by a great number of barely positive prices during the day, when solar farms reach their maximum output. The so-called special purchase price for photovoltaics, determined once a month, has fallen steeply. In August it reached a record low of EUR 25 per MWh.

Namely, the Operator of Renewable Energy Sources & Guarantees of Origin (DAPEEP) pays a producer the difference between the special purchase price and the price in the CfD contract, which is much higher.

Therefore DAPEEP benefits from negative hourly prices, since it avoids some payments, but it loses much more from low positive prices.

Special renewables account swings back into red

The operator’s special renewables account reached a breakeven level at the beginning of this year, but turned steeply negative in recent months. The latest official data show a deficit of EUR 160 million for the period through July. Initially, a gap of EUR 173 million was projected for the end of 2025, so investors are worried.

Payments to producers remain unaffected so far and they continue in a timely fashion. Regardless, conditions in the market have made investments in solar energy less profitable. Certain players have chosen to abandon their projects. EDP Renewables and ABO Energy have decided to leave Greece altogether.

The trend has fueled demand for the purchase of solar farms benefiting from feed-in tariffs, as they are not affected by fluctuations in the wholesale market. According to information that Energypress obtained, such facilities are currently sold for around EUR 700,000 per MW.