Greece pushes its coal exit target date forward to 2026

Greece’s Public Power Corporation (PPC) has accelerated the schedule for phasing out its lignite-fired power plants.

In 2019, after the New Democracy party won the elections, the Greek government aspired to phase out coal by 2023. In the meantime, following lengthy debates, speculations and the pressure from the energy crisis, the official target date landed at 2028. However, according to state-controlled PPC’s recent reply within a parliamentary debate, the country will cease burning the solid fossil fuel in 2026.

According to the timeline revealed in the document, units 1 and 2 of the Agios Dimitrios coal plant will be closed next month. The decision is based on consultations with the Independent Power Transmission Operator (IPTO), PPC pointed out.

The facilities Meliti and Megalopolis will be shut down by the end of the year, the utility added. It plans for units 3, 4 and 5 in Agios Dimitrios to cease operations in 2025.

As for the new Ptolemaida 5 lignite plant, an earlier idea was to convert it into a natural gas unit later in the decade so that it remains operational. However, PPC now seems to consider the option unfeasible. “According to current natural gas and European Union allowance (EUA) prices, the unit will be shut down in 2026,” the document adds.

So far PPC’s management has been tight-lipped about the future of Ptolemaida 5. The unit only began operating in late 2023 although it was completed about a year earlier. Even today the plant remains officially in a testing regime instead of participating fully in the market.

PPC operates all coal plants in Greece.

Sdoukou: The production cost in Ptolemaida 5 is EUR 120 per MWh

According to Deputy Minister of the Environment and Energy Alexandra Sdoukou, Ptolemaida 5 has a production cost of EUR 120 per MWh. In comparison, the levelized cost of electricity (LCOE) for new solar farms is EUR 40 per MWh to 45 per MWh, she added. The yardstick comes in at EUR 55 per MWh to EUR 65 per MWh for wind farms, Sdoukou asserted.

Still, another EUR 20 per MWh to EUR 30 per MWh is required for battery storage, she pointed out.

New gas plants unviable without capacity mechanism

It should also be mentioned that the long-term economic viability of new natural gas plants is under threat given the current and projected market conditions. Conventional plants have to align with strict emission regulations based on the European Union’s energy taxonomy.

International bodies such as the European Agency for the Cooperation of Energy Regulators (ACER) have said that countries willing to support such projects would have to come up with capacity mechanisms.

Based on all of the above, Ptolemaida’s 5 future is uncertain. PPC has the option to push the government for the unit to be included in a future capacity mechanism before converting, selling or shutting it down.