Greece establishes energy exchange with EU help

EPA/ORESTIS PANAGIOTOU/FILE PICTURE

Electricity pylons in an electric power station in central Athens, Greece.

EBRD acquires 20% of Hellenic Energy Exchange


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ATHENS – Seeking to create a single European energy market, which is one of the EU goals, Greece has launched the Hellenic Energy Exchange SA, the Greek Energy and Environment Ministry said on June 20.

The Hellenic Energy Exchange has been founded and will be owned by the state-owned electricity market operator LAGIE (22%), the Athens Exchange Group with 31%, the Hellenic Independent Power Transmission Operator (ADMIE) with 20%, the European Bank for Reconstruction and Development (EBRD) with 20% and the Hellenic Gas Transmission System Operator SA (DESFA) with 7%.

The EBRD is investing €1 million for the 20% stake, which is the bank’s first ever investment in an energy exchange. The funds will be used to finance the establishment of the first energy exchange in Greece, the bank said on June 21.

According to the EBRD, the Hellenic Energy Exchange will organise and operate Greece’s new electricity, natural gas and environmental markets through providing access to new energy markets and introducing new products on the domestic market.

The Hellenic Energy Exchange will provide access to new liquid energy markets and products that will, among others, support greater domestic competition, reduce barriers to entry for new energy market participants and allow the effective participation of renewable energy producers in the electricity markets. It will also support regional integration by facilitating market coupling with Greece’s neighbours, for instance, Italy and Bulgaria.

“The establishment of the new energy exchange is critical to the reform of the Greek energy sector,” the EBRD said. “It is also an essential element in the EU target model for energy markets, which Greece is committed to adopting.” The Hellenic Energy Exchange will offer a comprehensive set of new energy trading products well above the minimum requirements for compliance with the EU Target model, including new spot plus new physical and cash-settled energy derivative products.

Through the introduction of physical and cash-settled energy derivative products the new Hellenic Energy Exchange is aiming to provide domestic but also regional market participants with the opportunity to hedge their electricity market risk in different time frames as well as improve price discovery across the curve.

The EBRD started investing in Greece on a temporary basis in 2015 to support the country’s economic recovery. The Bank’s priorities there include strengthening private companies and the financial sector and supporting privatisation, infrastructure development and regional integration of the Greek economy. To date, the EBRD has invested over €1.7 billion in 34 projects in Greece.

 

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