The center-right Greek government’s highly touted decision to phase out lignite-fired power generation in the east Mediterranean country is attracting heightened attention from private sector energy companies.
Public Power Corp. (PPC), the one-time state monopoly for all electricity generation and supply in Greece but still the dominant power utility, recently confirmed a decision to transform the Ptolemaida 5 unit from lignite fired to natgas-fired, while increasing capacity to 1GW.
At the same time, Mytilineos group’s new CCGT 826MW power station is in the final stages of completion.
According to reports, another three energy companies are set to announce decisions for similar projects of up to 2.1GW, namely, Gek Terna, Elpedison and Damco Energy (Copelouzos group).
ATHEX-listed PPC, which flirted with insolvency prior to the 2019 election due to hundreds of millions of euros in accumulated losses mostly from the previous four years, now appears on a path of recovery. With renewed confidence, PPC is now intent on closing three lignite-fired plants with a total power output of 3.3GW.
The deficit in power generation from the closing of the three units, along with upgraded grid connections with neighboring countries – within the framework of the Target Model – and a plan to institute a capacity remuneration mechanism (CRM) are developments that make the domestic electricity market more attractive for investors.
At the same time, the pending transformation of Ptolemaida 5 into a 1GW natural gas-fired unit and operation of Mytilineos’ new unit by the end of 2022 render strategic decisions by the trio of would-be investors as urgent.
In a recent interview PPC CEO Giorgos Stassis forecast that there is capacity in the domestic market for “one and a half units more”, while Elpedison chief Nikos Zahariadis cited “room” for another two thermal power units beyond those already under construction.
Of the trio of possible new projects, Gek Terna’s license for a plant at the Komotini industrial part, in extreme NE Greece, is the farthest along in terms of licensing and groundwork. The 300-million-euro project foresees construction of a 665MW plant along a transnational pipeline route and near a Floating Storage Regasification Unit (FSRU) off the port of Alexandroupolis.
Further to the west, Elpedison proposed new unit would in the Thessaloniki area, the second biggest urban agglomeration in Greece after the greater Athens-Piraeus region.
Elpedison, a partnership between Hellenic Petroleum group (Hel.pe) and Italy’s Edison, has proposed a 400-million-euro natural gas-fired unit of 826MW at its Thessaloniki refinery, a project that is also fully licensed.
Finally, Damco is considering its entry into the power generation sector with a proposed 300-million-euro 662MW unit, also in the Alexandroupolis region, in order to exploit natgas supply via the FSRU. The Copelouzos group owns a stake of the latter.
Additionally, Damco recently announced an agreement foreseeing participation by the state utility of the Republic of North Macedonia, AD ESM, in former’s power generation schemes in Greece.
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