IERN International Energy Regulation Network

In the wholesale market (interconnected system), the incumbent utility, PPC S.A., retains an approximate 95% market share both in terms of installed capacity and electricity generated. In the retail market, PPC S.A. enjoyed a 99.6% market share during 2006 (as compared to 97% and 98.2% during 2005 and 2004 respectively). Marginal role for generation and imports by IPPs.

In the mainland (Interconnected System) capacity is based on fossil fuels (lignite 53 %). Generation on the non-interconnected islands is primarily based on fuel oil.

Greece is a net importer of electricity, mainly from Bulgaria and FYROM. Greece is exporting electricity to Italy, Albania, and the FYROM.

The Greek electricity market model consists of two separate markets: the wholesale electricity market (a mandatory pool consisting of four elements) and a capacity assurance market.

Mainland Greece and a number of Ionian islands are served by the Interconnected System. A multitude of island are served by non-interconnected grids. Greece has interconnectors to Albania, FYROM, Bulgaria, and to Italy, whose capacity is allocated in annual auctions and can then be traded.

The Greek electricity transmission system is operated by the Hellenic Transmission System Operator SA (HTSO), owned 51% by the Greek government and 49% by PPC. According to the Law 3426/2005, HTSO acts as an independent system operator whilst PPC SA retains the ownership of the network.

Transmission tariffs are regulated according to the System and Power Exchange Code, under a cost-plus approach.

PPC SA substantially supplies all consumers connected to the medium and low voltage system, although 10 companies were granted supply authorizations up to 2004.

A number of eligible HV industrial consumers have been supplied with electricity from the interconnections, either as self-supplied customers or through independent suppliers.

Retail tariffs are regulated, given PPC SA dominance on captive market (70% threshold, according to Supply Code).

All non-household consumers (almost 70% of annual electricity demand) of the interconnected system have become eligible.

The Greek gas industry is still in an early stage of development, and the Greek state is heavily involved in the industry through direct and indirect ownership.

The sector is dominated by the state-controlled (65% owned by the state, while Hellenic Petroleum SA owns the remaining 35%) Public Gas Corporation of Greece SA (DEPA SA). DEPA SA is the vertically integrated gas company which owns -through its subsidiary company DESFa SA - the National Gas Transmission System and up to the establishment of the Gas Law 3428/2005 had the exclusive right to import and supply natural gas in Greece.

Domestic production from the Kavala field is marginal and expected to decline. Greek gas imports are 1) via pipeline from Russia (75 % of import demand) 2) via LNG from Algeria (25 % of import demand) and recently via TGI from Azerbaijan. Import long-term contracts have been signed with Russian Gazexport, Algerian Sonatrach, and recently with Azerbaijani Socar.

Russian Gas company Gazprom has set up the joint venture Prometheus Gas S.A. for the direct sale of gas in the Greek market, although no gas sales have been conducted by Prometheus Gas yet.

No wholesale market exists for the moment, however in the Gas Law 3428/2005 special provisions provide for the establishment of such a market.

DESFA is the owner and operator of the National Network Gas System which is comprised of the main high pressure pipeline and its branches and the LNG Terminal at Revythousa island. DESFA is a 100% subsidiary of DEPA the incumbent gas company in Greece.

A regulated TPA regime exists for the use of the Natural Gas System, with published access tariffs (Ministerial Decision 4955 of 27th March 2006) and a Standard Transportation Agreement (Ministerial Decision 1227 of 18th January 2007). The secondary legislation concerning TPA will be concluded with the establishment of a Network Code and a Standard LNG Agreement.

The Greek downstream market for customers below 10 m3/y threshold is serviced by regional monopolies called EPAs, whose prices are controlled ex-post by RAE. Currently EPAs cover the areas of the Attiki peninsula, Thessaloniki, and Thessaly.

EDA is DEPA’s subsidiary which owns the fixed assets operated by EPAs.

The establishment of three new EPAs for the areas of Eastern Macedonia & Thrace, Central Macedonia, and Sterea Hellas & Evia, is currently under way.

Over 60 % of the Greek market, in terms of gas consumption volume), was formally liberalized in 2005 (electricity power producers). A gradual market opening is currently underway, with electricity power producers, large consumers (annual consumption over 100 GWh) and EPAs to be considered as eligible customers by the end of year 2009.

Full electricity market opening took place on 1 July 2007. However, the Greek Government has filed with the European Commission a request for derogation EC for the micro-systems on all non-interconnected islands (Crete and Rhodes not included).

New Draft Law for the promotion of electricity from Renewable Energy Sources and Cogeneration plants

Full gas market opening in 2009.

A new sub-sea pipeline connecting northeast Greece to Italy (IGI) - which through the Greek gas system will convey gas from Turkey to Italy - is in its pre- construction phase. The project is expected to add on security of supply for the Greek and European gas market, in terms of diversification of transportation routes and gas supply sources.

1. New Electricity Law 3426/2005 (since December 2005).
   For the new grid code and relevant regulation of the Greek market click here
2. Gas Law 3428/2005 (since December 2005)
   For the Legal framework of the Greek natural gas market click here