Since July 2007, when the retail electricity market in Greece was liberated, there are very few companies operating in the sector. Unlike other European countries and despite the growing demand and desire of consumers to turn to green energy, this highly profitable sector is poorly developed.
A number of problems prevent new companies, which are able to provide clean electricity from renewable sources, from entering the energy market. Some of those problems are:
- the inability to create alternative distribution network and supply infrastructure,
- the obligation for all companies to impose the so called “public interest service” (PIS) charges,
- the unilateral determination of the charges.
PIS charges are low charges imposed for power supply to disadvantaged groups and remote areas. The production cost of power in these cases is very high and all companies are obliged to include the PIS charges in their pricing for social reasons even if they are not able to provide such services. However, the imposition of the charges (set by ministerial decree) should not be sudden and arbitrary, so that they do not disrupt the corporate plans and oppose to the principles of corporate governance and competition in the relevant market. The issue is expected to be examined by the Supreme Administration Court and the European Commission for Energy, after the legal actions taken by a private company, pending from 2009, concerning the way in which charges are imposed and their compatibility with the EU competition rules.