The Energy Regulation and Markets Review: Greece


Greece is currently undergoing major energy sector reforms, aiming to transform the operation of the energy system, foster competitive energy markets, create significant investment opportunities, reduce greenhouse gas emissions through an ambitious decarbonisation plan, tackle existing climate change effects and ultimately facilitate a green energy transition.

The development of the national energy and climate plan for 2030, combined with Greece's energy privatisation plan and the impressive increase of the renewable energy (RES) potential in its power production, convey Greece's strong position as an important player in the European energy mix.

Conventional forms of energy (such as lignite and oil) hand on the torch to more eco-friendly and cheaper forms, such as RES and natural gas (as a bridge fuel), which is evidenced by the increasing penetration of RES and natural gas into the Greek market.

Another important aspect of upcoming energy reforms is directed towards energy efficiency, electrification and cost reduction driven by technologies such as smart grids, e-mobility and energy-efficient buildings. Major infrastructure development initiatives, such as the interconnection of the Greek islands with the interconnected system, as well as the establishment of the Hellenic Energy Exchange (HEnEX), are some of the main landmarks of the transition of Greece's energy landscape into a new era.


i The regulators

The Greek energy market is regulated by the Ministry of Environment and Energy (MEE) and the Regulatory Authority for Energy (RAE).

MEE is in charge of setting the country's energy policy and issuing secondary legislation, while RAE is an independent administrative authority, established on the basis of the provisions of Law 2773/1999, transposing Directive 96/92/EC on the liberalisation of the electricity market.

Although initially limited, compared to other jurisdictions, RAE's role was enhanced notably following the implementation of the third EU Energy Package by virtue of Law 4001/2011 (as well as Law 4425/2016). Following this reform, RAE is designated as the competent authority responsible for the security of energy supply and the granting, modification and revocation of all producer certificates and licences (although the authority to issue producer certificates will eventually be transferred to another administrative body pursuant to Law 4685/2020) required for the undertaking of energy activities, including the production, transmission, distribution, supply and trading of electricity and natural gas. RAE's other competencies include the approval of the tariffs of non-competitive activities, the granting of exemptions to the third-party access regime, the certification of transmission system operators for both electricity and gas and the certification of distribution system operators for gas. It is expected that the role and tasks of RAE will be further expanded to include the provisions of Directive 944/2019, when transposed into Greek law.

Finally, RAE is entitled to conduct studies, publish reports and resolve on or propose the enactment of measures, especially with respect to the observance of competition rules. RAE cooperates closely with the Hellenic Competition Commission where this is necessary and is accountable to the Hellenic Parliament. Its decisions and actions each year are reported in an annual report submitted to the Hellenic Parliament, the Minister for Environment and Energy, the Agency for the Cooperation of Energy and the European Commission.

ii Regulated activities


Under the Greek electricity sector legislation, the development, construction, commissioning and operation of any type of RES power plant (e.g., wind, photovoltaic, hydro, biomass) is governed by numerous and extensive administrative decisions and acts. More specifically, Law 3468/2006, as in force provides for a broad procedural framework for the licensing of renewable power production units in Greece. For a RES station to be constructed and operate, the following main licences need to be issued (unless exempted by virtue of a specific law provision):

  1. an electricity production licence or a producer's certificate;
  2. an approval of environmental terms (or an exemption therefrom);
  3. an installation licence; and
  4. an operation licence.

Finally, for the supply and trading of electricity, a separate licence is required to be issued by RAE.

Conventional power plants (producing energy from coal, oil or natural gas) are also subject to a specific licensing process supervised by RAE.

Natural gas

Operations in the natural gas sector are heavily regulated in Greece, while licences are required in order to own and manage an independent natural gas transmission system, and proceed with the activities of distribution and supply of natural gas. Such licences are issued by RAE following an application by the interested party. In certain situations (e.g., if a transmission system serves a public interest, a distribution grid is subsidised by domestic or EU sources, or multiple applications are to be submitted for a particular area), a tender process may need to be launched by RAE to grant the necessary licence.

The Licensing Regulation (Government Gazette Issue B' 3430/17.08.2018) covers the type and the content of application for the granting, amendment and revocation of the following licences, required for the conduct of the respective natural gas activity:

  1. an independent natural gas system licence;
  2. an independent natural gas system operator licence;
  3. a natural gas distribution network licence;
  4. a natural gas operation licence; and
  5. a natural gas supply licence.

iii Ownership and market access restrictions


Power supply and trading

Trading and supply licences can only be granted to persons:

  1. seated in the EU or the European Economic Area;
  2. seated in a Member State of the Energy Community;
  3. seated in a country having entered into bilateral agreements either with the European Union or Greece; or
  4. that are legal entities with a branch in Greece.

Natural gas

The National Natural Gas Transmission System (NNGTS) users registry regulation (Ministerial Decision Δ1/A/5816/2010 for gas trading) and the Natural Gas Licensing Regulation (Ministerial Decision 178065/ 2018 for gas supply) allow legal entities to apply for registration with the NNGTS users registry and to be granted gas supply licence respectively, as long as they are:

  1. seated in the EU or in the European Economic Area;
  2. a Member State of the Energy Community;
  3. a country having entered into bilateral agreements either with the EU or Greece; or
  4. a legal entity with a branch in Greece.

iv Transfers of control and assignments


According to Law 4685/2020, important changes in the shareholding structure of a licence or certificate holder, even if they result in a change of the entity designated for the funding of a project, will be subject to mere notification requirements without triggering an obligation to amend the producer certificate or the production licence.

Natural gas

Changes in the legal form or the shareholding structure of a holder of a gas supply licence need to be notified to RAE for the purposes of amending the respective licence. As regards listed companies, the aforementioned requirement applies only in cases of a change of control.

Transmission system operators and distribution system operators

In compliance with the ownership unbundling rules applying to natural gas distribution system operators (DSOs) and gas transmission system operators (TSOs), any intended change in their shareholding structure needs to be notified and further approved by RAE, while the unbundling certification provisions of Law 4001/2011 shall apply. RAE has to be informed and grant its prior approval if:

  1. a person (individual or legal entity) acquires a shareholding in a DSO or TSO;
  2. the participation of an existing shareholder reaches or exceeds 20, 33 or 50 per cent;
  3. the DSO or TSO becomes a subsidiary of a shareholder due to a change of a shareholding participation or change of control; or
  4. there is a change in its legal form.

For listed companies, an amendment application shall be submitted in the case of a change of control within the meaning of Article 3 of Regulation (EC) 139/2004 of the Council of 20 January 2004. If the change in the corporate or shareholding structure results in a change of control that falls under the procedure of preventive control of concentrations under Article 5 of law 3959/2011, the licensee shall also submit to RAE a copy of the decision of the Hellenic Competition Commission on the notified concentration.

Similarly, the electricity transmission system operator (ADMIE) (certified under Article 11 of the Electricity Directive 2009/72/EC, Law 4001/2011 and RAE's decision 475/2017, regarding TSOs in relation to third countries) has the obligation to notify RAE, in compliance with the applicable ownership unbundling rules, any intended change in its shareholding structure or a change of control, underpinned also by adequate reasoning for continuous compliance with a number of other obligations, including those related to the security of supply.

Energy markets

i Development of energy markets


A significant milestone was reached on 1 November 2020, following Greece's transition to the European Target Model for the operation of its wholesale electricity market (with the financial energy market already launched in March 2020), replacing the pre-existing mandatory pool system. Greece's Target Model comprises the following:

  1. the day-ahead market (DAM): participants submit trading (buy and sell) orders with an obligation of a next day physical delivery, while there is also an obligation to declare energy quantities resulting from trades carried out within the HEnEx's financial energy market or from over-the-counter energy financial instruments within the meaning of Regulation (EU) 1227/2011, and for which there is a physical delivery potentiality or obligation;
  2. the intra-day market (IDM): refers to the submission of trading (buy and sell) orders with an obligation of physical delivery, so that participants can balance their positions after DAM closure (i.e., reduce their imbalances and financial exposure, enabling them to adjust their initial day-ahead planning);
  3. the balancing market (BM): allows for real-time delivery with a 15 minute dispatch and settlement so as to balance the system closer to real time. It includes the balancing capacity market, the balancing energy market and the imbalances settlement. The imbalances settlement takes place post-real time and aims at the compensation of the energy arising from any imbalances of the participants in the BM. The BM is being implemented in two stages. During the first stage, the BM is limited solely to Greece, with cross-border balancing to follow during the second stage of implementation; and
  4. the financial energy market: refers to the purchase of capacity, either for physical delivery or as a derivative financial product through standardised future contracts. It is designed to create a hedging position and provide risk mitigation by enabling market participants to lock prices and supply volumes, thus limiting their exposure to more volatile spot markets (i.e., the DAM and the IDM).

Natural gas

By virtue of Article 19 of Law 4425/2016, as in force, HEnEx is also responsible for organising and operating the natural gas markets. Currently, an organised wholesale market for natural gas has not been developed in Greece. However, a natural gas trading platform is expected to be launched in Q4 2021 in implementation of the aforementioned Law.

ii Energy market rules and regulation


Following the implementation of the EU target model, the sale, purchase and, generally, trading of energy is conducted through HEnEX, also appointed as the nominated energy market operator for the Greek bidding zone, responsible for matching orders from the day-ahead and intraday markets and allocating the available cross-zonal capacities.

The market clearing price (MCP), namely the price at which the DAM is cleared, is determined through HEnEX. Producers injecting energy into the interconnected system are daily remunerated (either directly or indirectly through RES aggregators) by EnExClear (being the payment clearing entity for DAM, IDM and BM through the direct or general clearing members, and a 100 per cent subsidiary of HEnEX) on the basis of the MCP, while the same MCP is charged to those requesting energy from the interconnected system. IPTO, on the other hand, conducts the necessary actions to ensure the security and stability of the system through the BM.

The energy markets operate in accordance with the applicable rulebooks (i.e., the Financial Energy Market Rulebook,4 the Day-Ahead and Intra-Day Markets Trading Rulebook5 as well as the Balancing Market Rulebook6) while the clearing is performed by EnExClear and the respective clearing rulebooks (i.e., the Clearing Rulebook for Transactions on Day-Ahead and Intra-Day Markets7 as well as the Clearing Rulebook for Positions on Balancing Market as amended and in force8). Clearing of transactions within the financial energy market is under the responsibility of ATHEXClear, a member company of the Hellenic Exchange Group, by virtue of the Rulebook for Clearing Derivatives Transactions (Hellenic Capital Market Commission Decision No. 1/871/28.02.20209) as amended and in force.

Natural gas

In principle, any activity of sale, purchase, import or export of natural gas is not subject to any licensing requirement and thus is freely carried out. A supply licence is only required in the case of supply of natural gas to end users.

iii Contracts for sale of energy

A RES project can:

  1. benefit from the fixed remuneration mechanism under the previous feed-in tariff support scheme, based on a standardised power purchase agreement with the Renewable Energy Sources Operator & Guarantees of Origin SA (DAPEEP);
  2. participate in RAE auctions and enter into an operating aid agreement with DAPEEP while receiving the market price through its participation in the energy markets of HEnEx (either directly or through a RES aggregator); or
  3. participate in the energy markets of HEnEx (either directly or through a RES aggregator) or enter into a bilateral contract (corporate power purchase agreements (PPAs)), or both, receiving only the relevant market price or the agreed corporate PPA price, or both.

According to a draft bill expected to be submitted to the Greek Parliament for voting within 2021, RES investors opting to enter into corporate PPAs will be given licensing priority for their projects over those RES projects securing tariffs through RES auctions staged by RAE.

Entering into a corporate PPA, however, does not come without certain limitations. RAE Decisions No. 1008A/2020 and No. 1657/2020 set specific thresholds for suppliers wishing to enter into bilateral contracts with physical delivery, reaching a maximum of 20 per cent for suppliers with a retail market share exceeding a 4 per cent threshold. This percentage limitation is effective from the implementation of the EU Target Model (as of 1 November 2020) until 31 December 2021. RAE will reassess the percentages for the year 2022, taking into consideration the market data that will be collected until then.

Natural gas

In principle, any activity of sale, purchase, import or export of natural gas is freely carried out by virtue of Article 81 of Law 4001/2011, as in force. In particular, the trading of natural gas takes place between suppliers and their customers through bilateral contracts. A gas sale and purchase agreement is a long-term contract bilaterally negotiated for the sale and purchase of natural gas between a seller and a buyer. Such contract includes provisions relating to the mitigation of supply and delivery risks, addresses the parties' long-term obligations and describes the treatment of changes that may occur throughout the term of the contract.

iv Market developments

The phase-out of all lignite-fired power plants (by a deadline originally set for 2028 and now brought forward to 2025), with a view to doubling the contribution of renewable sources to Greece's energy mix over the next decade and the turn to a green energy mix, is a key priority for the Greek government. As part of this transition, the Hellenic Republic has promoted new investments in the regions of Western Macedonia and Central Peloponnese, where the country's lignite power-generation is located.

Law 4759/2020 contains provisions relating to the urban and spatial planning framework, focusing, among other things, on the transition to a new post-lignite era (Framework Law). The Framework Law aims to set out a sustainable and long-term plan for the future of the lignite regions and the basis for the provision of sufficient funding for its implementation. Regarding the financing of the transition, the coming months will be crucial, as the allocation criteria of the resources of the European Just Transition Fund among Member States will be finalised. Greece will claim significant funds from the EU's Just Transition mechanism, which was set up to facilitate EU Member States' green transition from fossil fuels and also to provide financial support. PPC, in its capacity as owner of the lignite stations and mines of Western Macedonia and Central Peloponnese, is aiming for the restoration of such areas and the further installation of RES stations.

Furthermore, a series of regulatory and legislative changes touching upon the issue of connection offers, and the installation as well as operation licences required for RES projects, are expected to be introduced in 2021. Such new set of rules aims to further expedite the licensing procedure for the issuance of installation and operation licences, opting for the simplified, transparent and efficient licensing of RES projects.

According to Greek government officials, more legislative changes are underway, focusing mainly on the implementation of new policies relating to RES-generated hydrogen, the introduction of new technologies in the market, such as offshore wind and hybrid renewable energy plants, and the implementation of a reform package targeting energy storage, in implementation of Directive (EU) 2019/944 (Storage Directive). The Storage Directive sets the rules applying to the storage of electricity and the conversion and storage in other energy forms, with the subsequent reconversion (or not) to electricity. The deadline for the transposition of the aforementioned Directive into Greek law was by the end of 2020. A special taskforce was formed by the MEE aiming to identify the regulatory initiatives required to finalise the storage licensing framework, as well as the rules of participation of energy storage units in the energy markets. The taskforce (which includes representatives of HEnEx, RAE and the transmission and distribution operators) is also empowered to explore the need to introduce specific financial incentives for the development of energy storage units. For these purposes, a respective proposal was recently prepared by the taskforce. However, any such financial aid would be subject to approval by the European Commission under the applicable state aid rules.

Renewable energy and conservation

i Development of renewable energy

Simplification and acceleration of the licensing process

On 7 May 2020, material reforms in the RES regulatory sector were introduced through the enactment of Law 4685/2020, aiming to simplify the licensing process for RES projects. This is the first set of rules that will be accompanied by a new legislative framework (pending issuance) in 2021. In implementation of the aforementioned Law, the new Producer's Certificate Regulation has been enacted by virtue of Ministerial Decision YPEN/DAPEEK/114746/4230. The key pillar of the new Law is the replacement of the production licence with a producer's certificate, issued electronically on the basis of a fast-track process. Various transitional provisions of practical significance are set out in Law 4685/2020 that apply also to holders of installation and operation licences. Significant amendments relating to the introduction of shorter deadlines for the development of RES projects, as well as the simplification and acceleration of the environmental licensing process, have also been introduced. One of the most significant amendments of Law 4685/2020 relates to the extension of the validity period of the approval of environmental terms from 10 to 15 years, which can even reach 21 and 19 years, respectively, if a project has in place an eco-management and audit scheme or ISO 14001. Similarly, shortened deadlines regarding the individual administrative steps for the issue, amendment and renewal of environmental terms approval decision (ETA, or AEPO, as per its Greek acronym) have been introduced. The role of certified evaluators has been upgraded: they may also be appointed by the public environmental authorities, following a producer's request, to perform the duties initially undertaken by the environmental authorities.

Restructuring of the energy market

As already mentioned, on 1 November 2020 the Greek energy market was reorganised under the EU Target Model for the purposes of achieving energy market integration. The operation of the energy markets (i.e., the financial energy market, the DAM, the IDM (operated by HEnEx) and the BM (operated by ADMIE)) is based on two broad principles: the development of integrated regional wholesale energy markets and the market coupling based on flow-based capacity calculation.

Measures to address the RES special account's deficit

On 13 November 2020, the MEE announced a set of measures to address liquidity issues in the RES market and, more specifically, to eliminate the RES special account deficit on account of, inter alia, the adverse effects of the covid-19 pandemic. The measures for addressing the

deficit of the RES special account, the status of which is a key indicator for the viability of RES market, were the following:

  1. an increase of the percentage of the proceeds generated from auctions for the sale of emission allowances from 65 to 78 per cent;
  2. financial support to the RES special account by an amount of approximately €25 million payable during 2020 as well as by a corresponding amount payable in 2021;
  3. a one-off special contribution for the year 2020 in relation to RES projects that were on a feed-in tariff regime and that were commissioned before 31 December 2015 equal to 6 per cent of the eligible RES projects' annual turnover for 2020;
  4. a one-off extraordinary fee imposed on suppliers, equivalent to €2/MWh, for the year 2021;
  5. a special green tax imposed on the consumption of diesel fuel equal to €0.03 /litre aiming to further support green projects and actions that contribute to the reduction of emissions;
  6. the adoption of a counterbalancing mechanism reducing the charges for the provision of public service obligations and the implementation of the ETMEAR levy; and
  7. financial support for the RES special account of an amount equal to €200 million generated from the EU Recovery Fund, provided that the relevant request of the Hellenic Republic is approved at an EU level.

A new legislative initiative shall be adopted in order to estimate the new RES special account's outflow. As a result, the amounts will be contributed by consumers through a new RES-supporting dynamic renewable charge (DRC).

RES tending cycle for 2021 to 2025

Having decided to further develop the RES tendering procedures, the MEE has planned to launch and carry out six joint RES tenders for onshore wind parks and solar parks with specifically set prices per technology until the end of 2024. Each individual tender is expected to be carried out for a tendered capacity of 350MW, resulting in 2.1GW of total auctioned capacity at the end of the said cycle. The prolongation and restructuring of the framework applicable to RAE tenders must be approved on an EU level before the application thereof (pending). To that end, for legal certainty purposes, the European Commission has prolonged the validity of the Guidelines on State aid for environmental protection and energy until 31 December 2021, which would otherwise have expired at the end of 2020. Further to the above, the Commission launched a public consultation (until 2 August 2021) on the draft text of the revised Guidelines in light of the recent European Green Deal and the EU's Industrial and Digital Strategies. According to the final proposal submitted by Greece to the European Commission, following the end of the public consultation, RES tenders will be conducted by 2025. The new model of RES tendering shall be applied in the first RES tender, which shall take place at the beginning of 2022.

ii Energy efficiency and conservation

Directive 2012/27/EU of the European Parliament and of the Council of 25 October 2012 on energy efficiency has been transposed into Greek law by Law 4342/2015. However, the transposition of the revised Energy Efficiency Directive (Directive 2018/2002), which sets forth energy efficiency targets of at least 32.5 per cent for 2030, is still pending. In addition to the foregoing, the improvement of energy conservation and the reduction of energy consumption are two of the main objectives of the national energy and climate plan. The aim is to improve energy efficiency regarding final energy consumption by at least 38 per cent in relation to the projected evolution of final energy consumption by 2030. Another aim is to increase the use of natural gas, as the intermediate fuel for switching to a low greenhouse gas emissions model, in final consumption sectors by at least 50 per cent compared to 2017. To achieve these goals, the applicable legal framework sets out energy efficiency measures for the building and transportation sectors, targeting to the transition to sustainable mobility.

Energy efficiency of buildings

Buildings are currently responsible for approximately 40 per cent of energy consumption. Therefore, the need to promote an improvement of the buildings' energy efficiency through renovation, and to adopt corresponding measures for renewing the stock of end-of-life cycle buildings, is evident. Reducing the energy consumption of buildings requires an increased use of energy-efficient and low-emission heating systems and the construction of smarter buildings with improved insulation materials. Other highly important policies are the optimal use of RES technologies to cover heating and cooling needs, and RES self-production systems to cover the needs of buildings for electricity, also by strengthening the role of consumers. Large-scale energy efficiency programmes for homes and the upgrade of the national building stock are some of the main priorities of the government. The latest edition of the saving at home programme subsidising energy efficiency upgrades of buildings is currently ongoing.


The use of vehicles powered by alternative fuels and electricity, a drop in unit energy consumption per type of vehicle, the use of second-generation biofuels, the complete electrification of railway infrastructure and the use of hydrogen trains will totally transform the technological structure and fuel mix used in the transport sector. Given that Greece is a leader in shipping, it is important for the country to promote emission reduction technologies in shipping in compliance with the decision of the International Maritime Organisation of April 2018 to reduce carbon intensity by 40 per cent by 2030 and by 50 per cent in total (70 per cent intensity) by 2050.


Through sustainable town planning and by addressing the demands of mobility and infrastructure, cities are called upon to play a pivotal role. In particular, there must be a shift from the conventional traffic planning used to date, giving priority to the unhindered movement of vehicles and to sustainable urban mobility. This shift will result from integrated and combined town and traffic planning and policies, aimed at reducing the use of vehicles, ensuring parking management and implementing arrangements, networks and accessibility for all (pedestrians, bicycles, mobility vehicles, mass transport vehicles). The national energy and climate plans have set a 30 per cent target for the share of electric passenger vehicles by 2030. In implementation of the above, the new Law 4710/2020 was introduced governing e-mobility and enabling the installation of publicly accessible electric vehicles charging stations. Various incentives (tax benefits, traffic privileges, VAT reduction for the purchase of electric vehicles) are expected to be implemented through a number of secondary legislation to promote the use of electric vehicles.

iii Technological developments

The next decade (2021–2030) is expected to be crucial for the development of innovative technologies that will help Greece to attain its ambitious energy efficiency objectives. Greece's new planning supports and promotes the strengthening of the role of consumers and the involvement of end-users in the energy market. The development of smart grids makes use of the potential of dispersed production, ensures the efficient functioning of the market, saves energy and contributes to meeting emission-reduction targets. DSOs face considerable challenges, as they represent the European strategy's main pillar for utilising renewable energy potential, reducing carbon emissions and improving energy security and efficiency. One of the main pillars of the ongoing transformation process includes the implementation of smart metering systems. Smart metering, which is intended to assist consumers in becoming active participants in the electricity market, is one of the main objectives included in HEDNO's capital expenditure programme for the coming years. When completed, the programme will contribute significantly towards the rational use of energy by final consumers.

The year in review

The operation of the EU Target Model is expected to bring multiple benefits, leading ultimately to lower prices for the final consumer and, at the same time, to a more efficient management and pricing of cross-border energy. However, since the implementation of the Target Model in Greece, several instances of market turbulence, also impacted by the covid-19 pandemic, have led to higher wholesale prices. Such costs have been passed on to low voltage and medium voltage customers by their suppliers, following activation of the wholesale market-related clauses included in their respective supply contracts.

It is evident that Greece is undergoing: (a) a remarkable transformation on several pillars of the energy sector, focusing mainly on the decommissioning of PPC's lignite plants and the implementation of the 'just transition plan', (b) the interconnection of the non-interconnected islands with the mainland grid, (c) the full rollout of smart metering systems (assisting consumers to become active participants in both electricity and natural gas markets), (d) the reduction of greenhouse gas emissions, (e) the adoption of a remuneration mechanism for grid sufficiency to replace a transitional mechanism for remunerating flexibility and (f) the turn towards green energy and the initiation of a number of energy sector privatisations.

On the privatisation front, it is anticipated that all energy privatisation plans currently in process will have been completed or will have reached an advanced stage by the end of 2021. In particular:

  1. the sale of a non-controlling stake of 49 per cent in HEDNO (the distribution network operator);
  2. the sale of a 100 per cent stake in DEPA Infrastructure SA, currently jointly owned by the Hellenic Republic and Hellenic Petroleum;
  3. the sale of 100 per cent stake in DEPA Commercial SA, the largest gas supply company in Greece (currently jointly owned by the Hellenic Republic and Hellenic Petroleum); and
  4. the granting of concession rights for the use, development and operation of an underground natural gas storage facility in the almost-depleted South Kavala natural gas field in the Northern Aegean Sea.

At the same time, the applicable framework for strategic investments has been amended by Law 4759/2020, narrowing down the RES projects qualifying as strategic investments to those using innovative technologies (such as projects with electricity storage systems, projects producing green hydrogen or connecting electricity networks to the national grid through submarine cables, offshore wind parks, hybrid RES production units on the non-interconnected islands or projects using biomass, biogas or geothermal energy, as well as photovoltaic thermal plants) over specific budgetary thresholds.

Last but not least, RAE has recently opted for the implementation of a transitional hybrid solution for Crete, in order to cover the island's energy needs. In particular, the new interconnection line with Peloponnese (Phase I) will operate as a 'virtual' power plant, until the operation of the bigger interconnection project of Crete–Attica (Phase II), expected to be completed by the end of 2023. Under the transitional hybrid solution, Crete will purchase the electricity transmitted through the small-scale grid link at target model energy markets. HEnEX will submit the orders on behalf of the load representatives and thermal units generating and supplying electricity in Crete in the DAM and IDM electricity markets, while DAPEEP will be in charge of submitting orders for RES production.

Conclusions and outlook

Greece has set quite ambitious energy targets for the next decade (2021–2030), committing to an increase of its RES share in the energy mix of to up to 35 per cent, a reduction in greenhouse gas emissions and an increase in its energy efficiency. Greek energy targets forecast more than 15GW of RES installed capacity by 2030 (excluding hydro).

At the same time, the decarbonisation of electricity production has already gone a long way in Greece, with the market share of lignite falling from 13.06GW in 2010 to 3.4GW in 2020, and the market share of RES (including large hydro) increasing from 4.76GW in 2010 to 10GW in 2020. The downside was that this progress was achieved until recently through high feed-in tariffs that have burdened both industry and consumers with high energy costs. However, the combination of the fall in the cost of RES technologies, the implementation of market mechanisms such as auctions and the newly introduced corporate PPAs have addressed this problem; therefore, the increase in RES penetration is expected to lead to further lower energy prices for end users.

On the other hand, other necessary developments are still in their infancy. The increased penetration of wind and solar electricity production necessitates the development of electricity storage, although the relevant legal framework is only now being developed. Sector coupling through the electrification of mobility and heating is significantly behind other European countries, with the relevant policy framework having been introduced only recently. The production of hydrogen or methane from renewable sources, the development of offshore wind farms and hybrid generation projects are also Greek national objectives. To ensure these objectives, however, several regulatory reforms need to be put in place, while their realisation entails investments of more than €44 billion, posing a great investment opportunity for RES and energy infrastructure projects in Greece.

Transmission/transportation & distribution services

i Vertical integration and unbundling

Law 4001/2011, as in force, adopted the unbundling model of independent transmission operators for both the electricity and natural gas sectors. Under the unbundling requirements, Law 4001/2011, as in force, prohibits any person (individual or legal entity) from:

  1. having direct or indirect control or any other right over a producer or supplier of electricity or natural gas operating in Greece and simultaneously having such control or rights over an operator of a distribution system of electricity or natural gas, or over the distribution system itself, and vice versa; or
  2. appointing or being appointed as a member of the board of directors or holding another management position of the operator, and simultaneously having direct or indirect control or any other right over a company, acting as a producer or supplier of electricity or natural gas in the Greek territory.


Before the implementation of unbundling rules, PPC SA (PPC), the leading power generation and supply company in Greece, acted as a vertically integrated undertaking. Following a full ownership unbundling, PPC has fully divested its interest in the independent power transmission operator (IPTO), which was initially PPC's 100 per cent subsidiary, following a divestment plan driven both by the Third EU Energy Package and the provisions of the restructuring and privatisations plan. IPTO is currently owned partly (51 per cent) by the Greek state directly and through DES ADMIE SA, and partly (49 per cent) by private investors, including the Chinese State Grid. With regard to the distribution network, it is currently operated by the Hellenic electricity distribution network operator (HEDNO), by virtue of RAE Decision No. 83/2014. HEDNO was established in 2012 following the spin–off of the distribution segment from PPC to a wholly owned subsidiary thereof, as a means to achieve the legal and functional unbundling of the electricity distribution network operation activities from the other activities of PPC's vertically integrated undertaking. PPC commenced the sale process of 49 per cent of its shares in HEDNO in December 2020 with the publication of a request for expressions of interest from bidders, and in September 2021, four binding offers were submitted. Spear WTE Investments Sà rl, a member of the Macquarie Infrastructure and Real Assets Group (MIRA), was declared as preferred bidder with a consideration of €2,116 million, including pro rata net debt of €804 million.

Natural gas

Law 4001/2011 has adopted full ownership unbundling of transmission system operators, such as DESFA, in implementation of the natural gas directive, Directive 2009/73/EC. The market for gas transmission includes transmission within the NNGTS. It is, therefore, distinguished from the market of natural gas transmission in independent TSOs (INGS). In this context, INGS operators (such as the Trans Adriatic Pipeline) may be exempted from ownership unbundling and third-party access obligations as well as the regulation of tariffs for transmission activities. Greek law recently expanded unbundling obligations to DSOs of natural gas, opting for a more strict unbundling regime even in the distribution sector in Greece and moving to more than is required under Directive 2009/73/EC.

ii Transmission/transportation and distribution access

Greek law ensures full access on a non-discriminatory basis to the transmission and distribution systems in both the electricity and natural gas sectors.


The transmission system and distribution network, often referred to as the 'interconnected system', is spread over the mainland of Greece. The Ionian islands, along with certain Aegean islands, are also included in the interconnected system, to which they are connected through submarine cables. The electricity system of a significant number of Hellenic islands is still not connected to the interconnected system and comprise a separate network called the non-interconnected islands. Following the recent completion of the connection of specific Cyclades islands to the interconnected system by IPTO, the electrical systems of Paros, Syros and Mykonos were interconnected. The majority of the Aegean islands (such as Crete, the rest of the Cyclades islands, the Dodecanese islands) will also become part of the interconnected system within the period running from 2021 to 2030, starting with the interconnection of Crete with Peloponnese (the small interconnection (Phase I)), which is already electrified, to be followed by the interconnection of Crete with Attica (the big interconnection in commercial operation (Phase II)), expected to be completed by 2023 in accordance with the expansion plan of IPTO.

The distribution network is currently operated by HEDNO, while its ownership rests with PPC, which was granted an exclusive ownership licence for the network. HEDNO is responsible for the development, operation and maintenance of the distribution network, ensuring at the same time the most economical, transparent, immediate and impartial access for all users (consumers, producers and suppliers) to the distribution network in order for them to engage in their respective activities. The non-interconnected islands network (under the exclusive ownership of PPC) is also operated by HEDNO, acting as the operator of the non-interconnected islands network. The management of the non-interconnected islands network includes, inter alia, the operation of the local electricity distribution networks and the operation of the electricity markets in these islands.

Third-party access to the transmission and distribution systems may be granted to: (a) licensed generators and suppliers or traders, (b) those exempted from the obligation to hold such licences and (c) eligible customers. The terms and conditions for the provision of transmission services and access to the transmission grid are regulated by the respective grid code and the rulebooks of the electricity markets (i.e., the Day-Ahead, Intra-Day, Balancing and Energy Derivatives Market Rulebooks), which are intended to ensure, inter alia, the non-discriminatory and objective use of the system and the operation of the wholesale power market.

Natural gas

The national transmission system is owned and operated by DESFA SA. Gas transmission is performed by DESFA through the NNGTS via extra-high and high-pressure pipelines, whereas distribution is performed by DSOs, distributing natural gas at a lower pressure to final customers connected to the DSO distribution network through middle and low-pressure pipelines. Law 4602/2019 provides for the division of DEPA commercial and infrastructure activities. Subsequently, based on Law 4643/2019, amending Law 4602/2019, DEPA was divided into three separate legal entities: DEPA Infrastructure SA, comprising all the distribution gas activities of DEPA; DEPA Commercial SA, where all DEPA's gas-related activities (both wholesale and supply) are transferred; and DEPA International SA, comprising all the international infrastructure projects in which DEPA participates. The same Law provides for the full privatisation of DEPA Commercial SA and DEPA Infrastructure SA, but not DEPA International SA. The Hellenic Republic Asset Development Fund has initiated the relevant privatisation processes, which are currently ongoing. DEPA Infrastructure, through its three subsidiary DSOs (EDAA, EDA Thess, DEDA), is connected to the NNGTS.

DESFA is responsible for granting access to third parties, managing, upgrading and balancing the transmission system as well as providing reserves. The above activities are conducted in accordance with the provisions of the Natural Gas Transmission System Code. The use of the system (through reserving capacity thereto) is subject to entering into the standard framework agreement for transmission and the standard-use LNG facility agreement. Entering into the relevant agreements is conditional upon having been registered with the National Natural Gas Transmission System Users Register, which is kept by RAE. NNGTS users are classified as natural gas suppliers, eligible customers or third parties with sufficient financial solvency and technical adequacy.

iii Rates


After a long period of regulated prices, electricity supply tariffs to customers were fully liberalised and are freely set by suppliers. According to the tariff-setting principles, set out under the Electricity Supply Code,2 suppliers are obliged to adopt specific basic principles during pricing and tariff setting to ensure fair competition in the electricity market and protect the interests of consumers. For this purpose, the tariffs set must reflect the actual cost of electricity supply, avoid discrimination between customers of the same category and characteristics, not distort competition, and be clear and transparent towards consumers.

Natural gas

Natural gas transmission and LNG terminal access and use tariffs are calculated by virtue of a RAE decision issued annually based on a tariff list prepared by DESFA.3 Tariffs for access to the natural gas distribution networks (currently operated by the subsidiaries of DEPA Infrastructure SA) are determined by using the methodology defined in the Natural Gas Distribution Tariff Regulation, implemented by virtue of RAE Decision No. 1434/2020 (Tariff Regulation) and the tariffs for use issued for each EDA. In particular, RAE is the competent authority for approving the methodology for calculating the distribution tariffs, the level of the tariffs applied annually by DSOs, the weighted average cost of capital, the regulatory asset base, and all capital and operational expenditures incurred by the distribution system operators. Furthermore, RAE is the competent authority for approving the terms and conditions for providing to distribution users third-party access to distribution networks and for approving distribution network development plans. Third-party access charges to INGS LNG facilities are predetermined by the respective independent TSO and reflected in the terminal usage agreements entered into with terminal users.

iv Security and technology restrictions

Law 4577/2018, which transposed Directive 2016/1148/EU into Greek law, imposes important obligations for system and network security on businesses operating in, among others, the fields of energy, water and digital infrastructure (Cybersecurity Law). The framework was further supplemented by the Ministerial Decision 1027/2019, specifying the implementation of procedures stipulated in the Cybersecurity Law. A new authority has been established (the Cybersecurity Authority), which is mainly vested with supervisory powers, the obligation to assess the compliance of businesses with the Cybersecurity Law and, to the extent required, to impose sanctions. A number of obligations have been imposed on businesses falling within the ambit of the Cybersecurity Law as regards the security of their systems, including the adoption of required organisational measures for the security of their networks, the implementation of preventive measures to address any security risks, as well as several notification obligations to the Cybersecurity Authority of any incidents that could have an impact on their business continuity. In general, there is a wide range of laws and legislative acts safeguarding the security of systems, such as those relating to data protection, e-privacy, laws on electronic communications and digital governance.


1 Valia Apostolopoulou is a partner and Anastasia Petta is an associate at Karatzas & Partners Law Firm. We would like to thank Mr Manos Nimas (former associate of our firm) for his contribution to a previous version of this chapter.

2 Ministerial Decision dated 29 March 2013, as amended and in force.

3 RAE Decision 1038/2020.

4 (Hellenic Capital Market Commission Decision No. 1/872/04.03.2020) (GG Issue B' 1491/21.04.2020)),

5 RAE Decision No. 1116/2018 (GG Issue B' 5914/31.12.2018.

6 RAE Decision No. 1090/2018 (GG Issue B' 5910/31.12.2018.

7 RAE Decision No. 1125A/2019 (GG Issue B' 428/12.02.2020).

8 RAE Decision No. 943/2020 (GG Issue B' 3076/24.07.2020).

9 GG Issue B' 1568/24 March 2020).

The Law Reviews content