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By Makis Georghiou
After twice recalling its tenders in the past month, the Greek electricity transmission system operator ADMIE finally issued new tenders for its Ariadne subsidiary to seek bidders for the cable project that will connect Crete to mainland Greece.
This confirms earlier reports that Greece was going on its own to build this sector of the cable as a ‘national’ project and at a higher cost to Greek consumers and taxpayers, parallel to the EuroAsia Interconnector cross-border link that enjoys EU support, will cost less and will be ready at least six months ahead of Ariadne.
The EuroAsia project will connect the Israeli and Cyprus electricity grids to Crete and Attica through a 1,000MW subsea high-voltage DC (HVDC) cable, with the latter section being the first to be delivered in June 2022, while Ariadne’s commissioning is scheduled for December 2022 at the earliest, and which will also cost at least EUR 350-450 mln more.
But no sooner had the tender documents been issued in Athens, the mayor of the Crete town of Malevizi reacted strongly saying that the Ariadne cable’s converter station will be built next to the village of Damasta, despite pleas to move it further out, just as the EuroAsia project agreed by moving the site for its station to the deserted Korakia location.
Mayor Kostas Mamoulakis said: “Instead of being pleased in Malevizi that the project for the ‘big’ interconnection from Crete to Attica was proclaimed, unfortunately, ADMIE had a nasty surprise for us today, at least as regards the location of the converter station, for which we had struggled all this time, together with the inhabitants of Damasta.”
The mayor added: “The people of Malevizi are not prepared to allow Damasta to be harmed. This is a village that has suffered [during WWII] with a great and heroic history, and its inhabitants, together with those of Malevizi, have declared our opposition to the location of the converter station.”
The two tender documents, that had been delayed after energy regulator RAE avoided rubber-stamping the Energy Minister’s insistence that the project be declassified from a European Project of Common Interest (PCI) and be branded as a ‘national’ project, also raised suspicions in Athens that the tight deadlines suggest that the preferred bidder has already been chosen.
These indications point to the contract being awarded to companies associated with State Grid Corp., the Chinese company that took a controlling 24% stake in ADMIE through a loan-for-equity deal. Industry analysts also suggest that this could be the reason why pro-ADMIE media had been spreading malicious rumours about Siemens as having illicitly clinched the deal, probably designed to disqualify the German manufacturer from bidding at all.
Adding to the confusion, ADMIE chairman and CEO Manousos Manousakis was quoted by Greek media as saying that in order for the Crete-Attica timeframe to be achieved, all interested parties must contribute – within and outside the borders – which is perceived as a warning about forthcoming delays, especially if EuroAsia and the European Commission proceed with legal and procedural obstacles.
After declaring the Crete-Attica sector as a ‘national’ project, whereas the rest of the interconnector remains classified as a PCI, as per the EU lists of 2013, 2015 and 2017, the European Commission is preparing an infringement process, ultimately penalising the Greek government for its U-turn on the status of the project.
Even the regulator RAE board had delayed issuing its conclusions, initially planned for early April, because the EuroAsia Interconnector challenged in the Athens Court of Appeals the unilateral decision by RAE to switch from EuroAsia and assign the building of the Crete-Attica sector directly to ADMIE.
In its letter to ADMIE on May 14, RAE admitted that “according to the Commission’s opinion, based on the principle of the Regulation (EC) 347/2013 prevailing over national law, the list of PCI projects, which … will remain in force up until its revision, binds the Member States as to the characterisation of the projects.”
“Given that the issue of interoperability remains an issue of primary importance which, unfortunately, has not been resolved through the procedure determined by the relevant decisions of RAE, we call on you to submit to RAE until Friday 17 May 2019 the technical specifications of the above project, highlighting those data that ensure in a complete way the as-above interoperability.”
To date, Ariadne did not communicate with the Cyprus energy regulator CERA or EuroAsia to secure the issue of interoperability of the cable system, and yet RAE gave it the green light to proceed with the tender documents.
With the Commission’s infringement process looming ahead and the legal challenges by EuroAsia in the Greek courts, it is not yet clear which international contractors will be prepared to submit bids, or if the Chinese bidders will be on their own.
The writer is a regular columnist on energy, geopolitical and maritime affairs.
