Law 4643/2019 has been recently passed and comprises provisions on energy market liberalization, modernization of the Public Power Corporation S.A. (PPC), privatization of the Public Gas Corporation S.A. (DEPA), support of Renewable Energy Sources (RES) etc.
Overview of the Law
Chapter A: In line with European Union’s Target Model the Law focuses on the completion of the Greek energy market restructuring. In parallel, the new provisions aim at harmonizing domestic law with the European Regulation on Wholesale Energy Markets Integrity and Transparency (REMIT Regulation 1227/2011).
Chapter B includes provisions for PPC modernization that enhance corporate governance and assist the effective operation of the company while Chapter C introduces measures that reinforce PPC’s viability by increasing its liquidity.
Chapter D aims at reshaping the gas market through the amendment of provisions of the current energy statute (Law 4001/2001) and further provides for DEPA’s radical corporate transformation and privatization. The goals are to enhance the competition in supply, make distribution networks more efficient and ensure the design and implementation of DEPA’s international projects.
Chapter E consists of provisions for RES support in the context of the national energy planning which is primarily based on the gradual extinguishing of lignite units and the simultaneous increasing of the RES penetration into the energy mix.
Chapter F includes, inter alia, provisions regarding the obligation for maintenance of oil stocks for emergencies, the security of energy supply on Crete and the licensing of RES stations.
Particular key points of the Law:
- The Law authorizes the Minister of environment and energy to designate a binding timetable for launching the energy markets of Law 4425/2016, namely the Electricity Markets, Natural Gas Markets and Environmental Markets.
- The Law re-defines the procedure and criteria for employee and executive recruitment to PPC and provides tools for reshaping its personnel (voluntary retirement schemes, intra-group personnel transfers and transfers to the public sector) as part of its modernization process.
- DEPA will undergo a corporate transformation:
- the infrastructure sector (including DEPA’s holdings in Attiki Natural Gas Distribution Company SA, Gas Distribution Company Thessaloniki – Thessalia S.A., Public Gas Distribution Networks S.A., DEPA’s ownership on the fixed assets of the distribution networks, the fiber optic network owned by DEPA, DEPA’s rights and obligations for development, the design and implementation of distribution network infrastructure projects etc.) shall be transferred to a separate legal entity which will be named “DEPA INFRASTRUCTURE SA”,
- the sector of international projects (including inter alia the Interconnector Greece-Italy (IGI Project), Eastern Mediterranean Pipeline Project (EastMed Project), the interconnector pipeline Greece-Bulgaria (IGB) and the rest of the projects aiming at the development, construction and management of infrastructure interconnections with neighboring countries) shall be transferred through a spin-off to a separate legal entity which will be named “DEPA INTERNATIONAL PROJECTS SA”.
- After completion of the corporate transformation, DEPA will be renamed “DEPA COMMERCIAL SA” and will maintain its gas trading and supply activities.
- The transformation process has already been triggered by the Hellenic Republic Asset Development Fund S.A., which on 9.12.2019 issued an invitation for the expression of interest for the acquisition of 100% shareholding in DEPA Infrastructure.
- Provisions for compensation of RES producers outside the support scheme of Law 4414/2016, which provided for feed-in premium and feed-in tariff contracts, and participation of RES producers in the electricity markets (day-ahead market, intra-day market, balancing market).