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The Buzz in Greece: Interview with Dimitris Assimakis of Norton Rose Fulbright

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There's a high level of activity in the Greek energy sector, says Dimitris Assimakis, Partner at Norton Rose Fulbright in Athens. “Renewables are going to be huge in the near future,” he says, “mostly due to the fact that Greek authorities have put forward an ambitious plan to have the share of renewables in the final gross electricity consumption at 60% by 2030.“ According to Assimakis this doubling of the current 29% share will require “a very aggressive investment program – mostly from the private sector.”

Assimakis reports that there is a “serious privatization” in the works. “The Public Gas Company – DEPA – is set to be privatized in a two-fold manner following its ongoing corporate restructuring,” he says. “As a result of this corporate restructuring, DEPA’s wholesale and retail supply activity will remain with the company, while there will be a spin-off of its gas distribution activity, which will be transferred to a new entity.” The tender processes for the privatization of both of DEPA’s business segments are ongoing, with “the deadline for submission of the expression of interest for the supply business set for March 23.” In addition, he says “there has already been great interest shown by PE funds, infrastructure funds, and utility companies during the expression of interest tender phase for the gas distribution spin-off.” Assimakis believes that the process for both is likely to end by early 2021.

But the privatizations do not end there. According to Assimakis, “it has been announced that the government will, sometime this year, engage in the privatization of the electricity distribution network, which is operated by a wholly-owned subsidiary of the state-controlled Public Power Corporation.“ According to him, the government will put 49% of the entity operating the network up for bid, “along with some of the management rights.” He says that the government is also considering selling off a part of its stake in ADMIE – the power transmission operator – which was partially privatized in 2017 when 24% of it was acquired by the State Grid Corporation of China.

“I’d say that another angle to investments in the Greek energy sector is that they will have an impact in the wider region,“ he continues. “The vertical gas corridor between Greece and Bulgaria — the IGB pipeline project — which finally gets under construction this year, will likely be finished in 2021.“ He reports that this will have wide-ranging implications for the entire region, as it can “diversify, in combination with the FSRU project developed offshore the port of Alexandroupolis, the gas supply options for the Balkans as a whole.”

“Gas remains important for Greece due to a phase-out plan for coal,“ Assimakis states, referring to one of the country's main sources of power, as the government has plans “to shut down all of the operating coal power plants by the end of 2023.“ He believes that what will fill the gap will “most definitely be gas and renewables.“

Ultimately, Assimakis insists that Greece has a bright future. “After a long period of recession, it would seem that things are on a turn, with GDP finally growing and the government set to introduce measures to ease the tax burden on corporate players.“ He also describes initiatives to combat the brain drain Greece has been experiencing as a result of the crisis. “Some 500 thousand people have left the country – which is a huge loss,” he says. “The state, backed by large corporations, has a plan for a ’brain gain’ scheme — that is to say, to introduce incentives for young professionals to come back to Greece and continue their work here, to benefit the economy.”