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Greece’s new energy minister, Kostis Hatzidakis, announces rescue plan for PPC

July 9, 2019 | Comments: 0Author:

Photo: Twitter.com/K_Hatzidakis
Greece’s new energy minister, Kostis Hatzidakis, announces rescue plan for PPC

Not 24 hours after the polls closed in Greece, the new prime minister, Kyriakos Mitsotakis, has unveiled his cabinet. New Democracy Vice President Kostis Hatzidakis will lead one of the two key ministries – of the environment and energy.

The new Greek Environment and Energy Minister Kostis Hatzidakis’ key task will be to tackle the majority state-owned power company, the debt-ridden Public Power Corporation (PPC), according to the Greek media.

Meanwhile, Reuters quoted Hatzidakis as saying that the new government will work on a rescue plan for PPC. He dismissed allegations of a plan to sell a stake in PPC, noting that there was no interest from investors.

Hatzidakis, who in the past served as development minister responsible for energy, played a key role in shaping the New Democracy party program for the energy sector in the lead-up to the July 7 elections, energypress wrote.

The energy news provider also wrote that energy issues that the new government needs to tackle include reducing PPC’s electricity market dominance, as part of a wider EU effort for electricity market liberalization, and galvanizing investment interest in the energy sector, both for conventional electricity generation and renewable energy sources.

“Electricity market liberalization to help PPC restructure”

Gerassimos Thomas, the new deputy energy minister for energy and natural resources, has said that the electricity market liberalization will help PPC restructure, as was the case with Greek telecom operator OTE.

Thomas, who has served as deputy director general in the Directorate-General for Energy at the European Commission, did not elaborate what action should be taken if PPC’s current bailout-required disinvestment of lignite units fails to deliver.

However, Thomas is in favor of a national policy for the energy system’s decarbonization that would take initiatives and move a step ahead of bailout requirements rather than simply observe them, and is a firm supporter of renewable energy, energypress wrote.

On the NOME electricity auctions, the official believes that their failure, so far, to break PPC’s market dominance must first be analyzed before any further action is taken.

PPC reported a EUR 542 million loss in 2018, driven by high CO2 emission charges and NOME net impact, as well as lower turnover, which decreased by EUR 201.8 million, or 4.1%, due to lower revenues from electricity sales, which slumped by EUR 335.4 million, or 7.3%, as a result of market share loss and the reduction in domestic electricity demand.

At the same time, the company has EUR 2.4 billion of arrears from bills left unpaid during the Greek debt crisis, which began in late 2009.

PPC requires capital support worth EUR 2.2 billion to achieve long-term sustainability, according to a Standard & Poor’s outlook backed by PPC CEO Manolis Panagiotakis.

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