In a move reminiscent of Spain, the Czech Republic, Australia and even Germany, the Greek government has proposed cuts to the country’s successful Feed-in Tariff (FIT).
On March 8, the Ministry for Environment and Climate Changes issued a draft law on the reform of the FIT under the so-called “New Deal,” in an attempt to lessen the deficit that already exists in the fund the country uses to pay for renewable energy incentives.
Greece uses a FIT to incentivize renewable energy in the country. Under a FIT, anyone who installs renewable energy systems (RES) on their homes or businesses sells all of the power produced by the renewable energy system back to the utility at an above-market rate under a contract that usually lasts for a period of about 20 years.
In 2013, Greece made changes to its solar PV tariffs. Effective February 2013 through February 2014 PV rooftop systems less than 10 kW were to receive €0.125 per kWh, systems greater than 10 kW but less than 100 kW receive €0.120 per kWh and systems greater than 100 kW receive €0.095 per kWh. The New Deal would alter those rates not only for new systems going forward but also for systems that are already in place and have existing contracts.
The New Deal would retroactively reduce, by up to 20 percent, the amount due to energy producers for the power that they sold in 2013. Energy producers would be required to submit an invoice reflecting the reduction in the amount they are due. Going forward, cuts would also be made to the contractual arrangements already in place.
Greek law firm Metaxas & Associates has been retained by a large number of RES stakeholders, both domestic and foreign, to provide legal advice and assistance in forming a targeted strategy to address the legalities of the proposed deal. According to the firm, there are “serious legal questions” about whether or not the proposal is acceptable under the Greek Constitution “as well as basic principles of European Law both at domestic as well as EU level,” said the firm in a statement.
The measure was given less than one week for public comment and a vote is expected on the New Deal within the next few days.
We will continue to monitor this story and offer updates as they become available.
Lead image: PV farm in Greece via Shutterstock