Creditors ask Athens to sell 40 pct of PPC plants

A proposal presented to the Greek government by its international creditors for opening up the electricity market provides for the sale of 40 percent of Public Power Corporation’s lignite and hydroelectric plants, on a tight schedule that sees a consultant being hired by August and completion of the process by July 2018.

The proposal is included in a draft memorandum of understanding sent by Greece’s creditors as an alternative measure for opening up the field of energy if the set target is not met through power auctions. An assessment of the power auction’s efficiency is being recommended for June, though not by the Regulatory Authority of Energy (as the bailout agreement provides) but by the creditors themselves, in cooperation with the Greek authorities.

The creditors are demanding that when an agreement is reached on the second bailout review, this should describe the measures needed. It also wants to see these measures legislated by the summer. In regards to the power auctions, the creditors remain adamant in their targets for the PPC lignite and hydroelectric power that needs to be auctioned: Therefore, 20 percent of output has to be auctioned off this year, against 8 percent in 2016, rising to 33 percent in 2018 and 2019.

The document sent by the creditors also cancels PPC’s plans for partnerships with private investors, as it stipulates that the buyers of the units that will be put up for sale should have no connection to the state. It also says nothing about the sale of part of PPC’s clientele as an alternative structural measure, which means the creditors have rejected the main PPC strategy for opening of market regarding the set-up and concession to third parties of two companies with a clientele ranging from industries down to domestic consumers.

As for the 17 percent stake in PPC, the creditors are rejecting the government’s idea for its transfer from state selloff fund TAIPED to the new hyperfund for privatizations; instead they prefer the immediate proclamation of a tender for its sale.