Filenews 8 June 2023 - by Chrysanthos Manoli
The long delay observed in the implementation of the natural gas regasification terminal by China's CPP and its partners is not enough, but there is also a delay in obtaining approval from CERA (in its capacity as Natural Gas Transmission System Operator) for the construction of projects for the connection of electricity producers to the gas transmission system under construction.
CERA's approval is necessary for DEFA to proceed with the necessary works so that the regasified natural gas produced by the Prometheus FSRU will end up at the EAC station in Vasilikos and at the PEC (Cyfield group) station under construction in a neighbouring plot or to another producer that will be interested in the future.
At its meeting on June 2, 2023, CERA decided to reject the new proposal submitted by DEFA for the connection projects, as it considered that not all the points indicated by the regulatory authority in December 2022, when it rejected DEFA's first relevant proposal, were properly revised.
In particular, the members of CERA's Senior Management considered that the new proposal "continues to deviate from the provisions of the Guidelines issued by CERA with its Decision No. 73/2021, while, at the same time, there are additional points that are either not adequately covered or need to be amended or deleted".
CERA's decision dated June 2nd '23 states that the Natural Gas Transmission System Operator (DEFA) is requested to make the necessary amendments to the documents of the Connection Project Proposal, in accordance with what is listed in Annex I of the decision and submit to CERA, within three (3) weeks from the date of notification of the decision, an updated Connection Project Proposal for approval.
Costly delay
The new rejection leads to a new delay. It cannot be excluded that CERA's third attempt to submit a proposal for connection projects may not satisfy CERA either.
However, while the delay continues, questions arise whether DEFA will finally be able to be licensed and start the construction of the necessary projects on time, without which natural gas will not be able to reach the power plants.
We remind you that the main works for the pier and other infrastructure in Vasilikos are in progress, but the operation of the terminal is scheduled for the summer of '24. Even if there is no further delay (given that CPP and ETYFA, a subsidiary of DEFA, are in arbitration for serious financial disputes), the operation of the FSRU is not identical in time to its utilization in electricity production, since EAC and possibly PEC will need some months for the necessary tests on the use of the new fuel.
The use of natural gas for electricity in the summer of '24 is of great importance, as without gas neither the 6th EAC unit under construction in Vasilikos nor the PEC unit can be exploited, if it is ready by then.
In such a case, it is certain that we will not have enough electricity in the summer of '24 and we will have to ensure additional production from rented (expensive and polluting) units.
