EU Backs Polish, Greek Energy Projects

- Advertisement -

The European Commission on 16 October approved €465 million and €134 million in project financing “for natural gas pipelines and modernisation works” in Poland and Greece respectively.

“Last Wednesday, the European Commission decided that both projects, Poland’s GAZ-System and Greece’s DESFA comply with EU state aid rules,” Maria Madrid, a spokeswoman for Competition Commissioner Joaquin Almunia, told New Europe on 18 October. The Commission has concluded that the projects will further EU energy goals without unduly distorting competition in the internal market.

In March, Poland notified plans to support the development of the Polish gas transmission network to the Commission. The aid, which is financed by EU Structural Funds, will be granted to GAZ-System, the State-owned gas transmission system operator in Poland.

GAZ-System will build a network of new pipelines that will help setting up a North-South Corridor of gas supply in Poland. The corridor is a network of infrastructure intended to facilitate the access to gas supply sources in the North (i.e. Norwegian gas and the LNG terminal in Swinoujscie) and to better integrate the Polish gas market with the gas markets in Germany, the Czech Republic and Slovakia.

As the pipelines will have a higher transmission capacity, it will be possible to give network access to a greater number of gas suppliers, in line with the principle of Third Party Access defined in EU internal market rules, the Commission said. This will stimulate competition in the gas supply market, it added.

“The broad aim of creating energy independence and of reliable supply is one of the factors that affect our investment,” Shirin Wheeler, spokesperson for Regional Policy, told New Europe on 18 October.

Earlier in October, Polish state-controlled PGNiG said in a statement it would kick off talks with Gazprom on the Yamal-Europe pipeline. However, Poland, which currently still imports close to 70% of gas, most of it from Gazprom, looks to diversify its gas supplies and get a discount from the Russian gas giant.

A European Commission source told New Europe “the aim of the North South corridor is to reduce dependency on Russian gas”.

Meanwhile, the EU and the Greek state are financing four projects of Greece’s DESFA, the majority stake of which is about to be sold to Azerbaijan’s state oil company SOCAR, aimed at improving and expanding the Mediterranean country’s gas network. These projects aim at increasing the gas transmission capacity and security of gas supply within Greece and indirectly at reducing CO2 emissions.

“The aid will help Greece to expand and strengthen its gas network. This will improve competition between gas suppliers and will benefit consumers, also by diversifying energy sources,” Almunia said in a statement.

DESFA, Greece’s only gas transmission operator, is obliged to ensure that third party access is available to its network for all suppliers of gas. DESFA plans to increase the storage capacity of a liquefied natural gas (LNG) terminal in Revithoussa and install a natural gas compressor station in Nea Messimvria. Moreover, the new high pressure gas pipelines will allow for diversification of energy sources in areas that did not have access to gas before (Aliveri and Ag Theodoroi-Megalopoli).

The Commission said that these projects help to develop the gas market in Greece by enabling DESFA to offer extra gas transmission capacity. In addition, the projects have indirect environmental benefits resulting from the possibility of using a less polluting fuel in areas that so far relied on heavy fuel oils in energy production, the Commission added.

Wheeler told New Europe that there are a variety of different objectives when Cohesion Policy funds energy projects. “The issue of energy dependency and supply is one of the key guiding aims in the investment. But for us there are other issues like environmental and general growth issues for Greece that make us do these investments,” she said.

follow on twitter @energyinsider

- Advertisement -

Subscribe to our newsletter

Co-founder / Director of Energy & Climate Policy and Security at NE Global Media

Latest

On the two-year anniversary, G7 Foreign Ministers address the devastating war in Sudan

After nearly 23 months of war, on March 21,...

Doom, gloom or boom?

While it is an almost painful daily task to...

Don't miss

On the two-year anniversary, G7 Foreign Ministers address the devastating war in Sudan

After nearly 23 months of war, on March 21,...

Doom, gloom or boom?

While it is an almost painful daily task to...

Romania utilizing all available resources to boost its energy independence

Romania is using all energy resources available, including natural...

Romania utilizing all available resources to boost its energy independence

Romania is using all energy resources available, including natural gas as the country advances rapidly with Neptun Deep gas project and new wind and...

Apollo Funds to partner with BP on TANAP gas pipeline from Azerbaijan to Turkey

British energy company BP said on March 21 it has reached agreements for Apollo-managed funds to purchase a 25 percent non-controlling stake in BP...

Caspian-Black Sea Green Energy Corridor countries push project forward

The Ministers of Azerbaijan, Georgia, Hungary and Romania met in Budapest on March 10, where they signed a joint letter to EU Energy Commissioner...

EU signs critical raw materials, energy and infrastructure deals with Kazakhstan

As part of the visit of EU Commissioner for International Partnerships Jozef Síkela to Astana, the European Union and Kazakhstan signed on March 13...

Weaning Europe off its Russian gas addiction

The Viking hero Ragnar Lodbrok once said “don't waste your time looking back. You're not going that way.” The words of the former king...

EU-Kazakhstan boost cooperation in energy, raw materials, transport, sustainability

The European Union and Kazakhstan have discussed at a meeting in Brussels the successful implementation of the Memorandum of Understanding between the Central Asian...

Tashkent’s busy diplomatic agenda

In the coming months, Uzbekistan will host high-profile summits between Central Asia with the European Union and the Gulf Cooperation Council. As global geopolitics...

Tajikistan: The Battle for Middle Earth’s Resources

Tajikistan is a small land-locked country tucked away in southeast Central Asia. Its capital, Dushanbe, is almost equally distant, at approximately 4,500 kilometers, from...