(Adds detail, background)
By Angeliki Koutantou
ATHENS May 2 Greece has agreed to sell
coal-fired plants and coal mines equal to about 40 percent of
its dominant power utility Public Power Corp's coal-fired
capacity, to help open up its electricity market, the energy
ministry said on Tuesday.
The agreement is part of a reform deal Greece and its
foreign creditors reached early on Tuesday, paving the way for
the conclusion of a drawn-out reform review and the disbursement
of further rescue funds under the country's third international
Under the rescue deal signed up in 2015, the third since
2010, Greece has agreed to cut the dominance of its state-owned
Public Power Corp in the retail market to below 50
percent by 2019 from about 90 percent now.
Last year Greece launched power sales to smaller power
producers to help cut Public Power Corp's share. But the lenders
questioned the effectiveness of the measure and also wanted
Athens to sell coal-fired plants after a European court ruled
last year that Public Power Corp had abused its dominant
position in the country's coal market.
Greece will hold a market test to sound out investors
interested in buying coal-fired plants and mines owned by Public
Power by November, aiming to wrap up the sale by June 2018, the
ministry said in a statement.
Athens also agreed to sell a larger quantity of power
capacity from December until 2019 but once the sale of the
utility's plants is concluded the quantity will be reduced, the
PPC, which is 51 percent-owned by the state and also
earmarked for a partial sale, has been hurt by overdue bills
which have reached 2.2 billion euros since the debt crisis broke
out in 2010.
The company, a former power monopoly, has tried to recoup
payments with phased repayment schemes, which has helped
provisions for overdue debt decline, still the burden of unpaid
bills had squeezed its cash reserves.
As prior action for the conclusion of the bailout review,
Greece has promised its creditors to swiftly propose a plan to
deal with the issue, the ministry said.
The lenders and Greece also agreed that Athens will relaunch
the sale of a 66 percent stake in its natural gas grid operator
DESFA and conclude it by the end of the year.
A 400 million euro deal to sell a 66 percent stake to
Azerbaijan's SOCAR collapsed in November after Athens passed
legislation raising DESFA's gas tariffs by a lower amount than
SOCAR had expected and SOCAR asked for a lower price.
The potential buyer should be a European operator to
safeguard energy supply security both for Greece and the
European Union, the ministry added.
Privatisations have been a key plank of Greece's
international bailouts but have reaped poor revenues so far due
to political resistance and bureaucracy.
(Reporting by Angeliki Koutantou, editing by Jeremy Gaunt and