Energy Reforms in Greece during the Economic Adjustment Programmes
Subject headingsEnergy Reforms ; Greece ; Energy ; Climate ; Economic adjustment programme ; Electricity markets ; Natural gas ; Privatisation ; Public Power Corporation ; Country focus ; Financial assistance ; Public Power Corporation
This paper summarises the approach taken by the Commission during the Economic Adjustment Programmes to address reforms to Greece’s energy market. It will argue that it was necessary address the sector as part of the programme, and to make energy-related reforms part of the conditionality applied to post-programme surveillance, underlined bv the Eurogroup commitments. The paper will explain how the Greek energy sector looked at the outset of the programme, which problems were seen as priorities to be tackled, and how such reform efforts developed. With a lack of competition and poorly functioning markets, necessary investments were not taking place, particularly in the context of the EU’s ambitious climate and energy goals. The paper will aim to show that over the years, the programmes were effective in contributing to real structural improvements in the energy markets. Today, the Greek energy sector is greener and more open to competition. Such reforms, with a focus on developing the renewable energy sector, proved to be aligned with the general direction of EU policy, shown by events after the programme such as the European Green Deal and the COVID recovery package, the Recovery and Resilience Facility, which put an emphasis on sustainable investments. The state of the energy sector has an impact on a country’s growth and competitiveness, both in its own right and for sectors that heavily rely on energy inputs. From a social aspect, energy poverty is an important issue to consider. Before entering the macroeconomic adjustment programmes, the Greek energy market was much less developed than that of its EU peers, not as open to competition and lacking investment. Given the importance of energy markets to the wider economy, it was found that a reform programme should also place focus on this area. With this in mind, this paper will argue that the programme was right to put efforts into a systematic reform of the Greek energy market. It will argue that those reforms, sometimes implemented in a different manner to how they were originally envisaged, made good progress, which helped the energy market from both an economic and environmental/climate perspective, with benefits for wider society.
Number of pages30p.
DescriptionJEL Classification: L33, Q40
Acknowledgements: The author would like to thank Carlo Viviani (SG-RECOVER) and Markela Stamati (DG ENER) for the useful comments and information and the Country Unit for Greece of DG ECFIN and especially the members who contributed for this publication: Platon Derdemezis, Fotini Dionyssopoulou, Sotirios Giannoulis, Julia Lendvai and Vasilis Nikitas.
Contact: Alexander Ioannidis, European Commission, Directorate-General for Economic and Financial Affairs, email@example.com