20110930-IEA-Energy_Policies_of_IEA_Countries_Greece_2011_Review_150页_2mb

Summary of Greece's Energy Policies (2011 Review)

Core Content

The 2011 review of Greece's energy policies highlights the country's potential to use energy policy as a tool for economic recovery and long-term development. It outlines key areas of reform, including electricity and natural gas market liberalisation, renewable energy expansion, and climate change mitigation. The International Energy Agency (IEA) has provided recommendations to support Greece in achieving these goals.

Main Viewpoints

• Economic Recovery through Energy Reform:
  Energy policy in Greece can significantly contribute to economic recovery by increasing competition and reducing the role of the state in the energy sector. This would enhance efficiency, create self-sustained employment, and promote prosperity.

• Need for Market Reforms:
  The electricity and gas markets require urgent reform to ensure fair competition, reduce the dominance of state-controlled companies, and improve regulatory independence. The adoption of Law 4001/2011 in August 2011 is a commendable step towards transposing the third Internal Energy Market Directives into national legislation.

• Renewable Energy Potential:
  Greece has substantial potential for wind and solar energy and has set ambitious targets to increase the share of renewables in total final consumption to 20% by 2020, which is higher than the EU obligation. The government has improved investment conditions through increased feed-in tariffs, simplified licensing, and stronger incentives for local acceptance.

• Energy Security and Diversification:
  Greece's energy sources are largely imported, with oil and gas being the main components. The country has diversified its gas supply routes, including imports from Russia, the Middle East, and the Caspian region. However, the risk of simultaneous unavailability of border entry points remains a concern. The government is encouraged to further diversify import routes and expand LNG capacity.

• Climate Change Mitigation:
  Greece's energy mix is among the most carbon-intensive in the IEA. To meet its climate goals, the country must focus on renewable energy, fuel switching, and energy efficiency. These measures are seen as key to reducing emissions and achieving the 2020 EU target.

Key Information

Energy Sector Overview

• Total Primary Energy Supply (TPES): 27 Mtoe in 2010, with oil at 52%, coal at 27%, natural gas at 12%, and renewables at 7.5%.
• Total Final Consumption (TFC): 20.6 Mtoe in 2009, with oil accounting for 65%, electricity for 23%, and the rest for other fuels.
• Electricity Generation: 60.8 TWh in 2009, with coal at 45%, natural gas at 27%, oil at 13%, hydro at 11%, and wind at 4%.
• Energy Intensity: Greece's energy intensity has been decreasing, but remains higher than the OECD average.

Market Structures and Reforms

• Electricity Market:

  • The Public Power Corporation (PPC) dominated the wholesale and retail markets.
  • Law 4001/2011 is a major reform that transposes the third Internal Energy Market Directives.
  • The law mandates the unbundling of system operators and enhances the role of the independent regulator.
  • The IEA recommends full implementation of the law and further limiting PPC's market dominance.

• Natural Gas Market:

  • The natural gas sector has traditionally been state-controlled, but reforms are now gaining momentum.
  • Independent suppliers and large customers can now import gas.
  • Over a dozen new players entered the market by the end of 2011.
  • The IEA supports these reforms and encourages further steps to ensure market competition and security of supply.

Renewable Energy Development

• Targets:

  • Renewable energy share in total final consumption to reach 20% by 2020.
  • Renewable energy to provide 40% of electricity generation by 2020 (15% in 2010).
  • 20% of primary energy for heating and cooling by 2020.

• Support Measures:

  • Increased feed-in tariffs, shortened licensing procedures, and stronger local acceptance incentives.
  • The 2008 Special Spatial Framework facilitated renewable energy siting.
  • Law 3851/2010 improved public acceptance by directing more money to local communities.

Energy Efficiency and Climate Change

• Energy Efficiency Potential:

  • Improving energy efficiency is a cost-effective way to enhance energy security and reduce emissions.
  • The IEA recommends further strengthening the coordination and evaluation of efficiency programs.

• Climate Change Mitigation:

  • Greece is on track to meet its Kyoto target.
  • The main contributors to emission reductions will be renewable energy, fuel switching, and energy efficiency.
  • The country is encouraged to focus on cost-effective measures and economic instruments.

Recommendations

• Implement Energy Market Reforms:

  • Full implementation of Law 4001/2011 without delay.
  • Intensify electricity and gas market reforms to increase efficiency and attract future investments.
  • Consider divesting from PPC and DEPA to reduce their market dominance.

• Promote Renewable Energy:

  • Ensure large investments in grid infrastructure and generating capacity.
  • Expand wind and solar power and connect Greek islands to the mainland transmission network.
  • Enhance energy system flexibility through storage, demand response, and time-of-use pricing.

• Enhance Energy Efficiency:

  • Focus on cost-effective measures to improve energy security and reduce emissions.
  • Intensify efforts to save oil and reduce its use during periods of high prices and economic distress.

• Strengthen Energy Security:

  • Continue to diversify oil and gas import routes.
  • Expand LNG import capacities.
  • Improve the draft Joint Ministerial Decision on the National Emergency Plan to ensure effective participation in IEA collective actions.

• Improve Regulatory Framework:

  • Ensure the Regulatory Authority for Energy (RAE) has full independence and sufficient powers.
  • Move to fully cost-reflective retail tariffs and eliminate cross-subsidies.

Conclusion

Greece has the potential to significantly benefit from energy policy reforms that promote competition, efficiency, and sustainability. The country has made progress in liberalising its energy markets and expanding renewable energy, but further action is needed to fully implement reforms, improve energy efficiency, and ensure long-term energy security. The IEA encourages Greece to continue its efforts in these areas to support economic recovery and environmental protection.