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European CommissionThe Second Economic Adjustment Programme for Greece. Fourth ReviewΡar /ΡageAction Deadline Comments Statusaccount the need for the new company to have at least 30%of PPC generation capacity, taking into accountdecommissioning and investment plans of PPC.MoU6.1.1.1.cMoU6.1.1.2MoU6.1.1.3The Government adopts legislation to clear furtherpossible legislative obstacles to the privatisation processwhile protecting the rights of minority shareholders.Ownership by the State or by any other entity controlledby the State of any quota of ADMIE shares will be subjectto the following conditions:a) ADMIE shares will bemanaged separately (i.e. by separate state entities) fromthose of the PPC or another energy company;b) Theprivatisation strategy and targets of the Government arefully respected;c) The process of acquiring the shares willhave no tax or financial consequences for the Governmentthat are incompatible with the objectives of the AdjustmentProgramme for Greece.The execution of the plan will be made in strict adherenceto the announced timetable, and in full agreement with theEuropean Commission services so as to ensure consistencywith the relevant EU legislation and best practice and withthe current fiscal programme and financing targets.6.1.2 Provisions regarding the privatisation of PPC and DESFAThe Government undertakes that whichever the outcomeMoU of the privatisation process the gas industry and electricity6.1.2.1 industry structure will be fully compliant with Directive2009/73/EC and 2009/72/EC.6.1.3 Ensuring that electricity prices reflect costsMoU6.1.3.1MoU6.1.3.2MoU6.1.3.3RAE ensures that electricity prices fully reflect systemmarginal costs at wholesale level and a retail marginallowing retail competition for all customer categorieswhen assessing price change proposals from PPC.In reviewing PPC's price change proposals, RAE willendeavour to eliminate currently existing crosssubsidisation, such as may exist for instance foragricultural electricity consumers and for consumersconnected to the low voltage grid with low consumption.The Government assesses best practices with a view tocharging royalties for the use of hydro and lignite andpublishes its report.September2013September2013ContinuousContinuousContinuousContinuous As in 6.1.3.1.6.1.4 Providing for a financially sustainable development of renewable energy sourcesThe Authorities commit to design and implement acomprehensive reform of renewable energy policies, withthe support and in close cooperation with the technicalassistance provided by the European Union, also takinginto account proposals in Ministry's “Plan to Reform theSector of Renewable Energy Sources (RES)” and the viewMoU of industry, to provide long-term sustainability at zero6.1.4average deficits.MEFP(9) The Authorities monitor the evolution of the Renewableenergy sector (MEFP: including the number of newproducers in the renewable energy market) in order tostimulate its appropriate development as provided by EUpolicies and legislation, while ensuring sustainability ofincentives and security of the network. In this view, theAuthorities:The draft Law is expected to be submitted toParliament in April and adopted by June 2014.The provisions for ADMHE were voted from theGreek Parliament.FEK 36/12.02.2014.The Cabinet Act FEK 168 Α - 24.07.2013 for theplan of privatisation of PPC provides the timetable.Law 4001/FEK 179 - 22.08.2011 incorporates theDirective 2009/73/EC and 2009/72/EC.A significant step in the direction of cost-reflectiveelectricity prices is the recent (Aug. 2013) award byRAE, following an international tender, of anextensive consultancy/study contract (to ERNST &YOUNG) for the provision of consultancy servicesin relation to:a) Conducting a baseline study of the cost structureof the Public Power Corporation (PPC) and itsnetwork subsidiaries (ADMIE SA & DEDDIE SA),including mining, generation, transmission,distribution and supply.b) Benchmarking of the above cost structure andperformance against international power utilities.c) Identifying and recommending forward-lookingstrategic measures on how to improve the cost baseof PPC, ultimately with a positive impact on the endcustomers,and providing a high-level roadmap forthe application of the recommended measures.d) Providing to RAE the framework developed forthe cost baseline analysis and benchmarking, so thatRAE could use it to monitor the cost structuredevelopment of PPC and other major players, and toassess their performance going forward.The results of the above Project will lead to a moreaccurate and updated, quantitative determination ofthe cost improvement potential of PPC's entireproductive chain, as well as to its optimal realisationpath, and, in doing so, it will ensure that the finalconsumer pays electricity prices that fully reflectsystem marginal costs, per customer category, thusavoiding cross-subsidisation.NotObserved.N/AObserved.Ongoing.Observed.Ongoing.Observed.Ongoing.Observed.Ongoing.July 2013 The report was published in Ministry's' website. Observed.116
ANNEXΡar /ΡageMoU6.1.4.1MEFP(9)MoU6.1.4.1MEFP(9)MoU6.1.4.2MoU6.1.4.3MoU6.1.4.4MoU6.1.4.5MoU6.1.4.6MoU6.1.4.7Action Deadline Comments StatusAdjust the RES levy every six months (July 2013, Januaryand July 2014) to eliminate the projected RES accountdebt by end December 2014.Adjust the RES levy every six months (July 2013, Januaryand July 2014) to eliminate the projected RES accountdebt by end December 2014.Complete the negotiations with the industry forintroducing permanent adjustments to existing powerpurchasing contracts, in particular for PV installations,with a view to align rates of return to sustainable EUaverage levels, considering Greek-specific conditions. Theresults of the negotiations will have to provide thefinancial sustainability of the RES account to avoid anextension of the “special solidarity contribution”, withoutputting an excessive burden on consumers.Ensure that measures taken to ensure the financialsustainability of the RES special account do not endangerthe economic viability of existing projects and thatmeasures aimed at reducing excessive windfall profits(special solidarity contribution or negotiated PurchasingPower Agreement (PPA) payments) are only taken in caseswhere tariffs had not been previously adjusted tocompetitive levels already.Ensure that LAGIE, RAE, and the Ministry of Energy,publish monthly data on the evolution of the RES accountwith rolling projections over the following 24 months fromthe date of publication.These projections will have to provide a baseline and anormative scenario to bring the debt down to zero by end-2014 and support policy choices after 2014.To ensure the financial sustainability of the RES account,and ensure that no excessive burdens are put onconsumers, introduces constraints that will cap the newlyinstalledRES capacity receiving incentives.Following the entry in operation of the electronic registryof RES installations, the Government ensures the monthlypublication of a report, detailed by source, on the state ofexisting installations (installed power and production). Thereport also includes data on the evolution of the licensingand installation process for forthcoming new plants.The Government modifies Ministerial DecisionΥΑΠΕ/Φ1/οικ. 24840 (ΦΕΚ 1900/Β’/03.12.2010) to allowthe inclusion of PV rooftop plants in the registry (October2013).6.1.5 Liquidity and arrears in the energy sectorWith a view to a complete clearing of existing arrears inthe energy markets, the Ministry of Energy, in closeMoU cooperation with ADMIE and LAGIE, will communicate6.1.5.1 to the EC, the ECB and the IMF the detailed gross debtand credit positions of all participants in such market on amonthly basis.1st July 2013December2013September2013For the 2nd semester of 2013, the level of the RESlevy has been increased significantly, from 9,32€/MWh (1st semester 2013) to 14,96 €/MWhaccording to RAE's decision No 323/2013/FEK1784 / 24-07-2013.Τhe RES levy for January and February 2014remains unchanged.RAE's decision No 663/2013.Α RAE's decision for the first half 2014 is ready tobe announced and implemented if: 1) no additionalmeasures for RES account are taken or 2) inaccordance with the additional measures dependingon the new tariffs of RES.See next action (6.1.4.2).To be included in the Omnibus Law voted in March2014.Continuous See action 6.1.4.2 above. N/AMonthly1st January2014September2013September2013MonthlyLAGIE and RAE publish on their websites thecontinuously updated projections on the balance ofthe Special RES Account.It is only about companies receiving incentives, it isconsidered as high priority action and Task Force isalso involved.YPEKA already has the detailed data. Furthercooperation between Ministry and EC/ECB/IMFwill be needed before final decisions.New deadline: March 2014.The electronic registry of RES installations isalready in operation.The monthly report is also beingpublished.The weblink is www.resoffice.gr.The modification of the MD was not needed.The weblink is www.resoffice.gr.The Ministry sends directly to EC/ECB/IMF themonthly data.Observed.NotObserved.Pending.NotObserved.Observed.Ongoing.Observed.Observed.Observed.MEFP(9)The Government provides EC/ECB/IMF with montlytables on the stock of arrears in the electricity market.July 2013The Ministry sends directly to EC/ECB/IMF themonthly data.Observed.MoU6.1.5.2MoU6.1.5.3The Ministry of Energy, in close cooperation with RAE,will promote, and facilitate through intermediation, theclearing of existing obligations among energy marketparticipants, while encouraging them for a fair sharing ofthe outstanding debt.RAE implements and monitors adequate regulatoryprovisions for netting of credit and debt positions by allactors in the energy markets, including, inter alia, terms forclearance of debts and payment of interest and penalties inline with Directive 2011/7/EU on late payments, andRegulatory provisions will have to ensure equal treatmentfor all participants, avoiding any distortion or unjustifiedadvantage coming from the belonging to verticallyintegrated companies.ContinuousContinuousObserved and ongoing.1a) LAGIE formulated a detailed methodology forthe fair and equitable allocation of existing debts toall market participants,1b) RAE adopted this methodology and issued theDecision 285/2013 (National Gazette Β' 1792/25-07-2013),2) RAE has been working on the development of asimilar methodology regarding all payments takingplace through the TSO, ADMIE SA,3) RAE has issued decisions (461/2013, 462/2013)for minimising the credit risk and increasing theliquidity of LAGIE, which, consequently, canObserved.Ongoing.Observed.Ongoing.117
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OUTLINE OF THE REPORTEXECUTIVE SUMM
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LIST OF GRAPHSGraph 1. Economic cli
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ACKNOWLEDGEMENTSThe report was prep
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