Renewables overtake lignite in Greek power mix

Renewables have leapfrogged lignite in Greece's power mix this year, reflecting wind additions and rising marginal costs at lignite-fired plants.

Output from wind and solar totalled 5.39TWh in January-May, against 4.27TWh a year earlier, data from domestic energy exchange Henex show. Wind plants accounted for 49.8pc of renewable generation, with 40pc from solar.

Lignite-fired generation more than halved — to 2.28TWh from 4.96TWh.

Gas-fired output continued to account for the largest share of the mix, but fell by 1.6pc to 6.64TWh.

Overall Greek generation fell by 11.3pc on the year in January-May.

Lignite-fired output — once with the largest share of Greece's power mix — has been falling steadily since last year, as rising EU emissions trading system allowance values push up generation costs. This — with low day-ahead prices and demand resulting from Covid-19 — has pushed lignite to the margins. Lignite-fired plants have been unable to enter the day-ahead pool on multiple occasions since the country's lockdown began in March, and Greece had its first day of lignite-free output on 8 June.

Increasing LNG supply has supported gas-fired generation, further displacing lignite. Pipeline gas imports have held a large premium to LNG deliveries, as state-owned supplier Depa's oil-linked term deals have left them uncompetitive against falling LNG prices.

Greek wind capacity rose by a record 728MW last year. And additions totalled 286MW in January-May, up from 195MW a year ago. Combined wind and solar capacity now stands at 6.3GW, against 3.9GW for lignite and 4.9GW for gas-fired plants.

Lower output at lignite-fired plants — all operated by state-owned PPC — saw PPC's share of the retail market fall to a new low of 66.3pc in May. Private-sector Mytilineos recorded the sharpest rise — to 7.3pc from 6.84pc.

PPC's thermal plants registered their lowest share of Greek output last month, 33.2pc, while Mytilineos and private-sector peers Heron, Elpedison and Korinthos Power's share rose to 30.4pc.

Greece's operational lignite-fired plants are to be decommissioned by 2023. The planned Ptolemaida V unit is to close by 2028, but could run beyond this if more gas -fired units are launched, PPC's engineering division, SDM DEI, said this week.

By Bilal Muftuoglu