Arthuros Zervos: Enhancing the credibility of the country

01 Δεκεμβρίου 2014 | Investing in Greece
Said the Chairman  & CEO of the PPC GROUP




The progress and development plans of the greater production and electricity supply company in Greece.

Would you like to “introduce” Public Power Corporation Group by referring to its aggregates and its fields of activity?
PPC S.A. was founded in 1950 with the aim of producing, transmitting and distributing electricity throughout the Greek territory. It is currently the largest producer and supplier of electricity in Greece, with an annual turnover of approximately €6 billion and approximately 7.4 million customers.



Within an international environment, where the energy market is liberalized, PPC S.A. is a fully vertical integrated company, covering all sectors of electricity. It is also one of the largest industrial enterprises in respect of its fixed assets.

It holds large infrastructure facilities of lignite mines, power plants and subsidiaries with regard to transmission and distribution of electricity. At the end of 2012 it held 68% of the installed capacity of Power Plants in Greece. Its production capacity comprises of fuel lignite, natural gas and oil power plants as well as hydroelectric and renewable energy sources stations.

After the spin-off of Transmission and Distribution segments, the new organizational structure ensures PPC Group greater flexibility, optimized customer service and greater economic efficiency.

PPC invests annually approximately €1 billion. What exactly does its investment plan involve, which are the objectives to be achieved and which is its progress?
The last four years, the total investments have exceeded one billion euro on annual basis, thus giving the green light, inter alia, for the launch of a new natural gas plant in the previous year, a new hydroelectric power plant that has just started to operate and a new natural gas plant that is currently in the final construction stage. Upgrading the energy capacity grid in the non-interconnected islands is also an important component of our investment planning. To that end, two of the most ambitious projects involve the interconnection of the Cyclades and Crete with the mainland. At the same time we are making steps to capitalize on the “challenges” emerged through the establishment of two subsidiaries in neighboring countries and the participation of the parent company in major new energy projects beyond the borders of Greece. Of course the most aspiring imminent project is our new lignite power plant Ptolemaida V Unit with power 660 MW and contract value €1.4billion. The new facility constitutes one of the largest production investments ever performed in the country and the vastest of all energy investments implemented until currently.

What measures has PPC Group taken to support the vulnerable social groups and deliver them uninterrupted electricity supply during the last years of the widespread economic recession in the country?
Apart from the structural changes, we had to deal with serious social problems because of the sharp decline in household income and business revenues of the country. In these difficult times, we managed to uphold our social commitment and offer debt settlement programs and even more favorable terms for the vulnerable fellow citizens. Specifically, in periods of extreme climate conditions there are no power cuts on vulnerable consumers while we have fixed more than 1 million settlements, with over 500,000 customers having been incorporated in the Social Residential Tariff established by the State.

At the same time, the Group has secured significant financing from domestic banks and the European Investment Bank to proceed with other investments. Could you please refer to the specific agreements and the investments associated with them? Do you think that the Greek economy is on the road to recovery and that it will be able to attract even larger investments in the coming years?
The last four years, striving to substantially modernize Public Power Corporation, we implemented a series of important actions, such as a considerable cost reduction -the largest ever made by any other body in Greece-, the successful spin-off of networks as well as investments totaling €4billion - the vastest implemented the last three years in Greece.

All these are reflected οn the upgrade of the enterprise from an international credit rating agency by 3 levels. This major upgrade is a milestone in the effort made by the largest industrial company to cope with the harshest conditions of the greatest crisis taken place in recent decades. So, a continuous positive course followed for the enterprise such as the conclusion of a five-year syndicated loan with the Greek banks amounting to €2.2 billion, the recent conclusion of loans with the European Investment Bank amounting to €235million -from a total funding line of €415million for network investments- and the conclusion of loan upon foreign banks consortium amounting to €739 million for the partial financing of our most ambitious project, the new Ptolemaida V Unit.

This dynamic course was reflected on our successful penetration in the markets from which we drew €700 million at a favorable interest rate. It should be noted that the bids were six times greater than the original amount of the issue announced.

Through these actions and other policies, we contributed significantly to establishing a sound electricity market that could be one of the most important pillars of development of the Greek economy.

In a difficult time for the Greek economy, the strategic choices of PPC in conjunction with its measurable achievements strengthened and continue to strengthen the company's credibility and the country’s credibility as well.