Greek Business File, November-December 2019, No 123

Βy Alexandra Sdoukou*

 

Greece’s drive towards a more sustainable future: the new priorities of energy policy.

Alexandra Sdoukou, Secretary General of Energy and Mineral Resources at the Ministry of Environment and Energy, analyzes the ambitious roadmap for Greece’s transition to a greener energy mix and the planned initiatives to increase energy efficiency and promote electromobility.

According to some estimates, for example the projections of the BP Statistical Review of World Energy 2019, the world is not on track to meet the Paris Agreement target of limiting global warming to 1.5 degrees Celsius. This is a plain fact, not ideology and even the most vocal sceptics cannot ignore facts. This is a double wake-up call to redouble our eff orts and progress towards achieving the Paris goals.

The EU is leading the way towards a more sustainable energy model. Let me give you two examples that speak for themselves:

– Whereas in 2018, global carbon emissions grew by 2.0% (the fastest rate since 2010-11) in the EU they dropped by 2%.

– Whereas global demand for coal increased by 1.4%, EU coal consumption declined more than 9%.

However, climate change is a global challenge and the EU’s emissions only account for 9% of the world’s global emissions.

These facts demonstrate that Europe may spearhead this global eff ort and set an example of effective and successful policies.

Undoubtedly, public awareness has grown significantly with regard to climate change. Governments should seize this political momentum and move towards this direction and the same applies to the industry and especially large corporations. The message of society is loud and clear: strong climate action is demanded.

This is certainly the case in Europe, and it is also the case in Greece.

Interesting conclusions can be drawn from the Eurobarometer carried out in April 2019:

1. 90% of the respondents in Greece see climate change as a ‘very serious’ problem, a percentage signifi cantly higher than the EU average.

2. More than one in ten (15%) have installed solar panels in their home, notably above the EU average of 6%.

3. The proportion of Greek respondents, who try to cut down on use of disposable items, has increased signifi cantly to 60% and is fast approaching the EU average of 62%.

4. Respondents in Greece are more likely than the EU average to agree that reducing fossil fuel imports increases energy security.

5. More public fi nancial support should be given to fi nance the transition to clean sources of energy

6. Finally, almost all respondents want the government to set targets to increase renewable energy and energy effi ciency measures by 2030 and support the aim of a climate-neutral EU by 2050.

So, -in the face of such support- what mea s ures is the Greek government taking? As Prime Minister Kyriakos Mitsotakis stated at the UN Climate Change Summit in New York at the end of September, the government is strongly committed to the Paris Agreement and to a climateneutral EU by 2050. This commitment translates into measures which will effect and require substantial acceleration of renewable energy investment in Greece and corresponding storage solutions both in the hydroelectric field and in other fields, on which the government is working intensively. This corresponds roughly to 65% of the domestic electricity production relying on renewable energy by 2030.

Attracting investments in Renewables

As for Renewables, attracting investments to Greece will be key and the government will work hard to create the conditions for the acceleration of investment activity in the sector. It is highly problematic that licensing in Greece today takes up to ten years, fi ve times the European average of two years. The project of ENEL Green Power on the island of Evia, recently inaugurated by the Prime Minister, took 14 years to be completed!

Greece is still far from the provisions of the EU’s RED II Directive according to which, licensing procedures should not exceed two years.

Initiatives are taken to close the gap. The fi rst key point of our approach is to simplify administrative procedures by eliminating duplication, cutting down the number of supporting documents required and reducing the administrative bodies that presently need to be consulted for licenses.

The second key aspect of the government‘s Renewables policy concerns the development of interconnections for the supply of electricity, especially for Greece’s non-interconnected islands, that today still rely on polluting oil products for their energy.

Supplying electricity to the islands today costs more than 700 million euro every year in Public Services Obligations (PSOs) – 300 to 400 million of this amount is absorbed just by Crete. Progress on this front will be achieved through the fast-tracking the Crete-Attica electrical interconnection, a project that will be amortized in 2-3 years. By next summer the Crete-Peloponnese interconnection will be ready. In the longer term, the Dodecanese interconnection is also planned.

In the context of Renewables, the role of hybrid projects and energy storage is under examination, as well as how to efficiently promote the development of large projects over 250MW and develop tools for the repowering and the redesign of RES plants which can give quick results.

Energy efficiency and electromobility

3. To enhance energy efficiency measures and to achieve an overall energy efficiency of 38% instead of 32,5% by 2030 as originally planned.

The emphasis will be given to the building and transport sector where the highest potential for energy efficiency measures exist. To fully maximize the potential of buildings’ eligibility for energy savings, the Ministry of Environment and Energy is introducing reforms to increase the participation of the private sector and the role of energy service companies.

The achievement of the above mentioned targets will lead to a significant reduction of the national GHG emissions, achieving ultimately a reduction of more than 40% from the level of emissions in 1990 and more than 55% from the level of emissions in 2005.

The Government is also promoting elect romobility. The first milestone is the development of an infrastructure of fast and ultra-fast charging network. This is not an easy task with numerous challenges ahead. The government’s plan is designed to address issues such as the standardization and interoperability of the stations and the ability of the consumer to use any public charging station, regardless of the seller of electricity.

Another milestone is the development of a sizeable fleet of electric vehicles. The main impediment is the high purchasing cost of an electric car. For this reason, financial incentives such as subsidies and tax exemptions are under consideration. A first step will be made through the introduction of a new fleet of electricity-powered buses for Athens and Thessaloniki.

Diversified gas supply

Finally, it is important to keep in mind that an important element of Greece’s path to a sustainable future is natural gas, which produces much lower emissions than coal and is highly accessible. Gas plants imply less need for coal stations, while being the best partner for renewables thus ensuring a reliable and flexible energy system.

Greece is already blessed with a relatively diversified gas supply coming from Russia, Turkey and LNG from Algeria. Of course, energy security is best served by having a choice of supply and reducing dependence on few sources. Our goal is to keep diversifying and, fortunately for the EU, there are abundant sources of gas from neighboring regions – notably the Caspian Sea and the Eastern Mediterranean.

Greece has the privilege of being strategically placed at the cross-roads of these sources and Europe’s markets. The country is the entry point for the Southern Gas Corridor and is repositioning itself as a gas hub. The next 18 months will see the opening of this corridor, with the start of operations of TAP as well as of the smaller Interconnector GreeceBulgaria project.

In the longer term, the EastMed pipeline will provide the new Levantine sources access to Europe, via Cyprus and Greece. Gas however is not confi ned by pipelines, as LNG has an increasing role to play. The small island of Revythousa is already a major terminal for South East Europe and the planned Floating Storage Regasifi cation Unit (FSRU) in Alexandroupolis will provide further LNG to the region.

All points above comprise a part of the government’s policy objectives to manage the risks of climate change and act on the warnings that the world is not on a sustainable path.

All policy areas – Delignitization, boosting Renewables, expanding energy efficiency measures and promoting gas- constitute opportunities for economic growth and the environment. They show that the new Greek government is acting on its commitments to ensure that Greece is on a sustainable path and to contribute to the EU’s role as a leader for the global transition.

* This article is based on the speech given by Mrs. Alexandra Sdoukou at the British Embassy (29.10.2019) for the presentation of BP Energy Outlook 2019.