UPDATED: Greek pool price rockets as strikes force 3.4GW offline

03 July 2014 15:42 Source:ICIS

The Greek transmission system operator (TSO) ADMIE declared a state of emergency on Thursday as strikes forced around a third of the country’s total thermal generation capacity offline and distribution companies warn customers of blackouts with the hourly pool price climbing as high as €138.5/MWh, the latest information reveals.

The Public Power Corporation (PPC) unions have threatened to hold 48-hour rolling strikes, protesting the government’s plan to privatise the company ( see EDEM 1 July 2014 ). PPC currently holds a monopoly over the Greek wholesale market.

According to a PPC statement published on Thursday afternoon, the Greek grid lacked 3.4GW of thermal generation, with 13 gas- and lignite-fired power plant forced offline by unions.

The PPC-owned distribution company DEDDIE has warned customers there will be rotating losses of power in various time windows and that the length and location of these power losses will depend on the level of demand and how much power is available.

Initial reports from sources pointed to the Greek pool price, known as the system marginal price (SMP), rising to as much as €150.00/MWh. The national spot average for Friday’s delivery, according to the market operator LAGIE, settled at €108.71/MWh. However the outturn reached an intra-day high of €138.50/MWh in the first hour.

Imports are expected to ramp up to maximum capacity on all available borders.

However, the imports will be limited since the Greek-Italy interconnector is not set to return from a six-month maintenance until mid-July ( see EDEM 16 June 2014 ) and no daily transmission capacity is available from Bulgaria.

Rolling 48-hour strikes

It remains unclear how long the situation will last, with the GENOP-PPC and SPARTAKUS unions threatening rolling strikes if the government fails to withdraw the bill. Sources said that the bill was up for discussion in the parliament on Wednesday but would require several days of discussions. This triggered the start of the strike, with initial rallies kicking off at 19:30 (local time).

“I think that a few days of mess are inevitable,” said one trader.

A second statement on PPC’s website said the Greek incumbent was filing a suit in the Court of Athens against the GENOP-PPC union, seeking to get the strike declared ‘illegal and abusive’.

One Greek trader noted: “I do not think they will stop before the voting of the law for example next Wednesday or Thursday.”

Blackouts

Some Greek traders agreed that the situation in the country was not as severe as it was the last time PPC went on a strike, when the TSO was not operating and LAGIE failed to calculate the SMP for two consecutive days ( see EDEM 29 January 2014 ). Some said that blackouts were occurring only occasionally in certain regions for not more than half an hour. “The government would not let actual [long-term] blackouts to happen”, one of them remarked.

One of them reported that the government was considering enforcing a law that is usually used in times of war or disasters to make the strikers go back to work or they would face prosecution.

“They are dispersed throughout the country but affect smaller communities. In the region of Athens they are limited to some small villages in the outskirts,” another trader said. Sophie Udubasceanu and Irina Peltegova

By Sophie Udubasceanu