SOS is broadcast by electricity supply and generation companies

By Haris Fludopoulos

Last week ESAI (Hellenic Association of Independent Power Producers) and ESPEN (Hellenic Association of Energy Suppliers) sent a letter-cry of anguish to the government addressed to the Minister of Environment and Energy Kostas Skrekas and the Deputy Minister of Finance Theodoros Skylakakis, underlining that “they are extremely critical conditions in the energy market” and calling for “immediate measures to be taken by the government in order to deal as much as possible with problems that have arisen”.

The letter includes proposals from the two links on four sub-issues, with the greatest interest centered on the issue of bad debts: the accumulation of consumer arrears and the increase in bad debts has now become an absolutely critical problem for the industry, directly threatening the viability of of business activity related to the supply of energy, the letter typically states.

ESPEN and ESAI request the updating of articles 39 and 42 of the Electricity Supply Code regarding the context of the change of Supplier in a way that will be aligned with the relevant decision of the Council of Ministers. “Having returned to the original provisions of the KPIE – which was drawn up a decade ago based on a completely different supply market environment – ​​customers are now able to terminate their contract and change supplier at any time, without having to take care of the coverage or settlement of their financial obligations, the letter emphasizes.

In fact, this possibility of consumers was further strengthened by article 138 of the recent law 4951/2022, the letter emphasizes. At the same time, the suppliers have lost the possibility of claiming the overdue debts of their (former) customers in question, through the submission of an order to disable provision.

As can be seen, the specific framework – especially under the current conditions – favors non-payers, strengthens energy “tourism” and leaves energy suppliers absolutely exposed, emphasize ESAI and ESPEN.

Advance payment of TEM subsidy

The second issue raised by the letter concerns the payment of advances to electricity suppliers for the granting of subsidies to final consumers. The relevant possibility is at the discretion of the minister of energy who can issue a ministerial decision.

“At the point we have reached, our Associations believe that the advance payment is required to be equal to at least 75% of the estimated TEM grant amount and to be paid by the fifth day of the grant month. For example, by September 5 at least 75% of the estimated subsidy amount for the month of September should be paid to each supplier.Since this schedule is not feasible for the current month, 75% of the estimated subsidy amount for the month of August is proposed to be paid until August 16. The remaining – at most – 25% will be able to be paid in accounting on the basis of the actual data on the invoicing, which the suppliers provide to DAPEEP and the other supervisory bodies”, the letter states.

As highlighted by ESAI and ESPEN “it is necessary to issue the relevant Ministerial Decision immediately in order to strengthen the liquidity of the companies even in the month of August, a month in which we see high prices being maintained in the international electricity market, obviously affecting the Greek electricity market and natural gas”

Provision of state guarantees

The third issue raised by the letter concerns the provision of state guarantees to supply companies in order for them to secure lines of credit. “The jump in prices in the wholesale electricity market has forced supply companies to multiply the amounts of guarantees they deposit at the Energy Exchange and ADMIE” stress ESAI and ESPEN, pointing out that the temporary framework of the EU state aid crisis. allows the Greek government to pursue such a policy. In addition, it is noted that the availability of loans from the Recovery Fund can work effectively in the given situation.

Trustees’ Fees Provisions

Finally, the fourth issue raised by the letter concerns the possibility of settling the payment of regulated fees to administrators. As the letter mentions, since February 22, RAE has already taken care of receiving data from suppliers that prove the sharp increase in both settlements and overdue debts from consumers who are leaving.

“Consequently, as a minimum and as a first measure to recognize the financial burden on suppliers, measures could be legislated, corresponding to those implemented to enhance liquidity in the energy market and to deal with the consequences of the coronavirus pandemic. These measures should allow on the one hand a rate of payment to the Administrators corresponding to what the consumers pay to each supplier and on the other a repayment duration corresponding to the duration of the arrangements that each supplier offers to its consumers” suggest the two links.