Announced Greek 20-20-20 scenario a positive step, but plan needed for lignite

Publish date: July 2, 2010

Written by: Ilias Vazaios

The Greek Ministry of Environment, Energy and Climate Change, announced on June 21 its plan on how to attain the 20 - 20 - 20 climate and energy targets set by the EU. The plan positively describes a major increase in the share of renewable energy sources in the country’s energy mix. Yet the role of lignite appears to remain important even in the long-term for Greece’s electrical energy production. In the face of that, a plan is desperately needed to tackle the adverse economic and environmental effects of lignite power production in Greece.

The Ministry announcement sets a binding national goal of achieving a 20% share by renewable energy sources (RES) in power production (40% share in electricity production) by 2020, which is more than the 18% goal originally set by the EU’s renewable energy directive for Greece. 10% of fuel used in transportation is projected to derive from bio-fuels by 2020. Major investments in renewables are intended to achieve the goal of 4% reduction of greenhouse gas production by 2020, compared to 2005.

Out of the €22 billion of investments on the Greek energy sector by 2020, about €16 billion will be pumped towards the development of the renewable energy capacity of Greece. Indeed a new bill recently approved by the Greek Parliament goes a long way to create a favourable setting for investments in renewables addressing previous bureaucratic obstacles. The Ministry estimates that the turn to renewables will lead to total savings of €1.3 billion in emissions allowance purchases between 2010 and 2020.

The 20-20-20 Greek plan underlines the dedication of the new Ministry leadership to develop the potential of RES in Greece which is undeniably high as has in many instances been suggested by Bellona. This is a very positive first step for a chapter turn in the troubled Greek climate policy. Yet the projections provided in the plan continue to leave questions unanswered regarding how Greece is planning to counteract environmental and economic dangers resulting from the persistently important role of lignite in electrical energy production.

According to the plan all existing lignite plants will be phased out by 2024. However three new lignite plants are projected to have been built by then by the Public Power Corporation, namely: Ptolemaida 5 by 2017 (600MW), Meliti 2 by 2018 (450 MW), Ag. Dimitrios 6 by 2025 (600 MW). The projection of the plan for 2295 MW of total electrical power derived from lignite combustion by 2025 implies that more than 3 lignite plants will need to have to be built by then to attain this goal (see table). Indeed the liberalisation of the energy market and high interest by private companies leads to the conclusion that the rest of the needed lignite plants will derive from private investments. Terna Energy and Elpedison have already filed applications at the Regulatory Authority for Energy for the construction of lignite plants in Northwestern Macedonia.   


 Based on the persisting important role of lignite in Greece’s energy policy the plan of Greece on how to tackle environmental externalities and rising emission allowance costs remains unanswered. The state-owned main utility PPC, currently a profitable company, is expected to lose €500 million a year because of its high emission record, according to its CEO Dr. Arthuros Zervos. 

Yet no plan has been defined on how to tackle these arising issues. The Greek Ministry of Environment, Energy and Climate Change has not drawn a strategy regarding CO2 capture and storage and its stance still remains highly ambiguous. Greece has not yet undertaken serious CO2 storage research to define if CO2 sequestration is indeed possible within the country. What is more the country has taken no steps to implement EC Directive on CO2 Geological Storage (EC 2009/31). That inevitably creates the impression that projected lignite plants are not bound to be capture and storage ready – despite the Directive’s obligation that it be verified if new plants are CCS ready.

The 20-20-20 plan announced by Greece is indeed a major first step. Yet for the plan to become more convincing in its intentions to radically curb national emissions in the long-term, Greece should start working towards the serious investigation of its CO2 storage capacity using available external funding. Otherwise, an alternative convincing plan needs to be defined describing how Greece plans to radically reduce emissions from its future lignite plants.