The Perspective of Penetration of Natural Gas in Greece

Aristotle University of Thessaloniki IPSP: Law and Engineering for Energy

Dissertation

Dimitrios A. Sourlas

The perspective of penetration of Natural Gas in Greece

Thessaloniki, 2017 DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Aristotle University of Thessaloniki

IPSP: Law and Engineering for Energy

Dissertation

“The perspective of penetration of Natural Gas in Greece”

Dimitrios A. Sourlas

+306976711958 [email protected]

Supervised by: Dr. M. Kontogiorgis

Thessaloniki, 2017

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Abstract

The aim of this dissertation is to produce a proposal for the penetration of natural gas in Greece. There has been a large cover of network in the biggest cities of the country so far, but didn’t develop in the same rate to the smaller ones. By studying the network’s history in terms of transmission and distribution over the years and with the recent changes in regulation, the reader will be completely informed with the condition as it is today. Future plans of worldwide transmission networks are described and taken into account in the proposal.

The proposal consists of splitting the Greek territory into regions of study for purposes of ease of operation and economic sustainability. Those regions are Thrace combined with Eastern and Central Macedonia, Western Macedonia combined with Epirus and the Ionian Islands, Western and Central Greece, the Peloponnese, Crete and finally Northern and Southern Aegean Islands.

It is found that Greece needs to take advantage of the TAP future project for serving areas such as Western Macedonia, CNG can be used with good terms for Thrace in combination with the already existing DESFA network. LNG will play a major role in the proposal in both road and sea transport. Road transport of LNG is preferred in many cases such as the Peloponnese in combination with CNG for small cities and concerning all the islands there should be an interconnection between the closest ones and get served by LNG for transport from the mainland, either from Revythousa or the new FSRU in Alexandroupolis. It is also recommended a new LNG port in Igoumenitsa for the Ionian Islands and Epirus.

The total capital needed for the most economical solution proposed is at the level of a billion euro and should be proposed to become a common interest plan for the country’s safety of supply.

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Abstract ...... 2

1. Introduction ...... 4

2. Today’s Network History ...... 6

3. Future Projects ...... 9

3.1. Southern Corridor (SCP-TANAP-TAP) ...... 9

3.2. Eastern-Mediterranean Pipeline ...... 10

3.3. Interconnector Greece – Bulgaria (IGB) ...... 10

3.4. LNG shipments ...... 11

3.5. Internal Transmission and Distribution System development ...... 12

4. Description of Penetration of Natural Gas Proposal ...... 13

4.1. Key assumptions ...... 13

4.2. Proposal Description ...... 13

5. Proposal Study ...... 16

5.1. Thrace, E. Macedonia, C. Macedonia ...... 16

5.2. Western Macedonia, Epirus and Ionian Islands ...... 29

5.3. Western and Central Greece ...... 39

5.4. Peloponnese ...... 44

5.5. Crete ...... 49

5.6. Northern and Southern Aegean Islands ...... 56

6. Conclusion and Discussion ...... 72

7. References ...... 76

8. Appendices ...... 78

8.1. DESFA Transmission Network ...... 78

8.2. DEDA Distribution Network ...... 80

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

1. Introduction

Energy has always been in the front of events for centuries, affecting counties in a worldwide framework. The world’s economic growth is linked to cheap energy amongst continents and hydrocarbons since its first discovery led to an industrial revolution that turned our lives to a better standard of living.

Transferring energy from the physical resources to the end customers has created an industry so important, that in most cases countries are dependent on it. Technological growth, inventions, spread of good practices, regulations and personnel experience through the years have concluded in reducing costs of drilling, mining, transferring in many ways and preparation for consumption.

Natural Gas is the successor of oil in the modern days, which is steadily growing in demand. At present, most climate scientists insist that greenhouse gas (GHG) emissions, especially carbon dioxide (CO2) emissions, play a crucial role in global warming. It is friendlier to the environment because its burning does not leave traces or produce chemical compounds of sulfur which is one of the most important causes of pollution1.

The EU has embraced natural gas for many years now, inducing residential and industrial consumers use it instead of oil for environmental reasons as well as economic ones. The policy is also about safety of supply, so that the mixture of energy amongst the countries will give independency and create competition between fuels. Greece as a member of the union followed the policies and introduced it as an economic fuel just 20 years ago.

This dissertation is about to reveal the Greek history of natural gas networks, in terms of transmission and distribution system development since its first steps in 1995 up to now. There will also be presented future projects that concern the country, as well as plans for development by the existing carriers.

There will be proposed a solution for the remaining Greek territory that natural gas has not penetrated yet, by splitting into regions with respect to distance and ease of operation. Comparing pipelines with alternative ways of transfer such as CNG and

1 Impact of natural gas consumption on CO2 emissions: Panel data evidence from China’s provinces, Kangyin Dong et al, 2017 4

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

LNG, will produce an outcome for each region according to the business eye and will be projected at the final proposal as a road map for the penetration of natural gas in the country.

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

2. Today’s Network History

The national natural gas transmission and distribution system has developed quite slowly over the years since its beginning under the law 2364/19952 where the body of energy inspection and design was constituted with the purpose of importing, transferring, supplying and distributing natural gas, which later substituted by the Regulatory Authority for Energy (RAE) by the law 2773/19993. The national natural gas company (DEPA), founded in 1988 as the daughter company of the state oil company (DEP), as being the carrier of natural gas infrastructure development was the first company that took the burden to construct and operate the national transmission and distribution system. DEPA had the right of supplying natural gas to the distribution companies and big customers of more than 100 GWh per year. DEPA had the right to found distribution companies with geographical and operational restrictions and those distribution companies had the right to contribute their rights to supply companies (EPA) whose purpose would be to plan, exercise and exploit those rights. Three supply/distribution companies were founded in Greece, EPA Thessaloniki and EPA Thessalia in the year 2000 and EPA Attiki in the year 2001. Their purpose were to exercise the exclusive right of planning, design, engineering, construction, exploitation and supply of natural gas to end customers for the regions of Thessaloniki, Thessalia and Attiki relatively. EPA Thessaloniki and EPA Thessalia had since its foundation and until today as shareholders 51% DEPA and 49% ENI Spa as the strategic investor who would exercise the company’s management. In the same form the strategic investor for EPA Attiki was Shell Gas B.V., retained until today. Following the provisions of the law 3428/2005 the National Gas System Operator (DESFA) was formed in 2007 as a subsidiary company of DEPA.

A major change in the natural gas market occurred with the law 4001/20114 whose purpose was to incorporate the 2009/73/EC guideline for the natural gas internal market rules. The law defines an independent transmission system, every system apart from the national system operated by DESFA, with or without interconnection to it, which will be operated by an independent operator. This means that the country

2 2364/1995 Establishment of the Energy Audit and Planning Body. Import, transport, marketing and distribution of natural gas and other provisions. 3 2773/1999 Eligible Customers’ Supply Code, Second Draft 4 4001/2011 For the operation of Electricity and Gas Energy Markets, for Exploration, Production and transmission networks of Hydrocarbons and other provisions. 6

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE liberalizes the transmission system, giving the opportunity to other schemes to enter the transmission system in the Greek area, such as TAP, under the inspection of RAE.

In the same law, the distribution networks are defined as the distribution network of Attiki, Thessaloniki, Thessalia and rest of Greece. With the law 4336/20155 that added articles 80A, 80B and 80C in the 4001/2011 the three established EPA and DEPA had to get unbundled operationally by supply and distribution. This meant that the original companies had to get split by operations into the former ones for supply and new companies for distribution (EDA) who would be the distribution operators. This occurred in January of 2017 and it is today’s situation. Today’s picture gives us DESFA and in the near future TAP as the transmission system operators and EDA Attiki, EDA Thessaloniki-Thessalia and EDA rest of Greece known as DEDA as the distribution networks operators, all of them under the inspection of RAE.

The government has embarked on a strategy to expand use of natural-gas in order to both diversify the energy sources and reduce the CO2 intensity of the economy. The use of natural gas has been experiencing the fastest growth of all fuels consumed. This situation is expected to continue at least until 2020. Greece’s supply of natural- gas is diversified as the country relies on two pipelines: Russian natural-gas is imported through the Greek-Bulgarian entry point, while the Greek-Turkish entry point allows Greece to import gas from the Middle East and the Caspian region. Greece began importing natural gas in 1996. While the Russian Federation has always been a main supplier, Algeria and Turkey have recently began to account for more of the total, making up 16% and 15% of the total gas imports in 2012, respectively. Russian gas as a share of total gas imports gradually declined from 85% in 2005 to 60% in 2012. Natural-gas imports are considered an important policy issue, and efforts are being made to further diversify the sources of natural-gas imports, to expand LNG terminals and to build new gas interconnections.6

Greece’s total natural gas imports in 2012 were some 4.5 Bcm, roughly three-quarters of which were supplied by pipeline and the remaining portion was imported in the form of LNG. Russia has been the principal source of natural gas imports since

5 Pension provisions - Ratification of the Draft Financial Contribution Agreement by the European Stability Mechanism and arrangements for implementing the Financing Agreement.(3rd Memorandum) 2015 6 OECD country report Greece, 2015 7

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Greece began to import gas in November 1996. However, the share of Russian gas in total gas imports has gradually declined from 85% in 2005 to 60% in 2012, because of the increase in imports from Algeria and Turkey which accounted for around 16% and 15% of the total gas imports in 2012, respectively. The Greek Public Gas Corporation (DEPA) has three long-term contracts for natural gas supply; with Russian Gazexport (2.8 bcm/y until 2015-2016), with Algerian Sonatrach (0.5 bcm/y until 2019) and with Turkish Botas (0.7 bcm/y until 2021). Together they will supply a total volume of about 4.2 bcm per year7.

The national transmission system consists of high pressure (70 bar) pipeline and branches of total 1460 Km with three entry points in Sidirokastro, Kipoi and Ag. Triada. There are 6 operation and maintenance centers and 46 measuring and regulating stations, as well as a compressor station in Nea Mesimvria, which is shown in detailed map images in the Appendices. A plant of LNG regasification is established in the island of Revythousa, outside Athens that has two tanks of total 65.000 m3 in capacity, unloading capacity of 7.250 m3/h, it can accept shipments of 25.000 m3 to 135.000 m3 with a potential of regasification of 1.000 m3/h8.

The distribution networks are highly developed in Athens, Thessaloniki, Larisa, Volos, Trikala, Karditsa and other smaller cities of Thessaly by the relevant distribution companies. Distribution networks already exist in a small scale as the basic design of cities such as Kilkis, Lamia, Halkida, Serres, Komotini and others as shown in maps in the Appendices. The future projects of developing transmission and distribution system are to be described in the next chapter.

7 International Energy Agency report: Greece, 2014 8 NGNS Development Programme 2016-2025, DESFA 8

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

3. Future Projects

Several Projects have been discussed for the Southern-Eastern Mediterranean region of Europe, who have the main target of serving the European area who is quite a large consumer and have been relied from oil for a long time. At this point the European Commission is implementing the decision of reducing emissions by 40% until 2030 as adopted from the Paris Agreement9. Natural gas is about to play a major role in achieving the goals of the agreement and the projects that to that point were only discussed, began to realize. The EU’s energy security policy as read in the Lisbon Treaty10, is based on three principles: sustainability, competitiveness and security of supply. This policy led the EU to acquire several inputs coming mainly from the East, where large quantities exist in the Caspian and the Southern Gas Corridor11. New findings in Cyprus and Egypt of natural gas resources have provided the EU with new options, such as the East-Med and several LNG projects.

3.1. Southern Corridor (SCP-TANAP-TAP)

These are the two projects that matured in contrast with its contesters and are destined to carry natural gas from the Azerbaijan’s Shah Deniz-2 gas field and the South Caucasus Pipeline (SCP), running through 20 provinces of Turkey12. Trans Anatolian Natural Gas Pipeline (TANAP) is about to end at the Greek border, where Trans Adriatic Pipeline (TAP) begins, running through Greece, Albania and ending in Italy, where through interconnections natural gas will reach the end customers in Europe, such as Greece, Italy, Austria, Germany, Bulgaria, United Kingdom, France etc. The TAP project is linked to the TANAP project and both of them are in a satisfactory level of completion, TANAP by 70% and TAP by 60%. Both projects according to the timelines are to be operating by the end of 2019, where 16 bcm of natural gas per year will flow through TANAP, which is planned to expand into 31 bcm per year in the future and 10 bcm per year will flow from TAP, which is planned to expand into 20 bcm per year in the future. This project is taken into account in the proposal below

9 Adoption of the Paris Agreement, Draft decision -/CP.21, 2015 10 Treaty of Lisbon amending the Treaty on European Union and the Treaty establishing the European Community, 2007 11 Multicriteria decision support to evaluate potential long-term natural gas supply alternatives: The case of Greece, Androulaki-Psarras, 2016 12 The Trans-Anatolian Pipeline (TANAP) as a unique project in the Eurasian gas network: A comparative analysis, Ozdemir et al, 2015 9

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE and can give good solutions in the development of the Greek transmission system and create opportunities of interconnections with the existing one for the common safety of supply13.

3.2. Eastern-Mediterranean Pipeline

The Eastern Mediterranean pipeline is characterized as a common interest project14 by the EU and is considered to contribute in the union’s safety of supply. In the recent past several reserves of natural gas have been discovered near Israel, Egypt, Lebanon and Cyprus, which need to be transported to consumers either by pipelines either by LNG. The conquering project for transferring natural gas to Europe is the Eastern Mediterranean Pipeline. The project has been designed to carry 10 Bcm per year into Europe following the route of Cyprus to Crete, further to the Greek mainland- Peloponnese and from there to the Italian grounds followed by a future expansion to other European Countries. It is also predicted a consumption for Cyprus of 1 Bcm per year and the future capacity will reach 30 Bcm per year when finished.

Due to the fact that the project is planned to pass through the Greek territory, gives the country an opportunity to become a natural gas hub for the years to come and definitely is going to help its distribution network develop in a fast rate15.

3.3. Interconnector Greece – Bulgaria (IGB)

The Gas Interconnector Greece-Bulgaria (IGB Pipeline) will provide a direct link between the national natural gas systems of Republic of Greece and Republic of Bulgaria with an Entry Point in Komotini and an Exit Point in Stara Zagora. The IGB Pipeline will therefore act as a strategic gas transportation infrastructure providing diversification of gas supply to the Bulgarian and South East Europe gas market and supply security to Greece. It is characterized as a project of common interest and is co-financed by the European Union under the European Energy Programme for Recovery. It is designed to transport 3 Bcm per year from Greece to Bulgaria and get expanded at 5 Bcm per year in the future.

13 EU's external energy governance: A multidimensional analysis of the southern gas corridor, Abbasov 2013 14 Commission Delegated Regulation 2016/89 15 European Union energy supply security: The benefits of natural gas imports from the Eastern Mediterranean, Ruble 2017 10

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

On 10 December 2015 the Shareholders in ICGB AD, respectively Bulgarian Energy Holding EAD with 50% and IGI Poseidon with 50%, concluded the procedure for taking the Final Investment Decision (FID) in relation to constructing the IGB Pipeline (Gas Interconnector Greece-Bulgaria).

The taking of the FID opens the last leg of developing the project before the start of the construction phase, which according to present schedule is planned to take place from the 4th quarter of 2016 until mid-2018 when commercial operation is aimed to be achieved. The FID commits the shareholders to provide the capital required to complete the construction phase, once regulatory, permitting and exemption milestones will have been attained, as currently scheduled, within 201616.

3.4. LNG shipments

Liquefied Natural Gas has already become a strong competitor to pipelines, since in terms of cost it is preferred by many countries such as Qatar, Algeria, Nigeria, Norway and the idea of exporting to EU is adopted by the USA lately, since their discoveries of fractured natural gas reserves.

The latest reserves in the Eastern Mediterranean, such as Zohr or Aphrodite have led to discussions about creating LNG ports in Egypt and Cyprus in order to become dual exporters and not be relied only in pipelines.

Due to the fact that Greece is surrounded by sea, give the country the considering that natural gas can be imported in large quantities by the sea ways of LNG, which will give the advantage of competition of supplying by exporters and will contribute to the EU’s security policy17.

The Bulgarian state energy holding company BEH and Greek natural gas company Gastrade have set up a joint task force to prepare a proposal to build an off-shore liquefied natural gas (LNG) terminal in northern Greece, the Alexandroupolis FSRU. According to the Gastrade website, the floating LNG unit to be moored close to 18 kilometers off the port of Alexandroupolis and will be connected via a subsea pipeline to the metering station near the village of Amfitriti.

16 ICGB AD, 2017 17 European Union energy supply security: The benefits of natural gas imports from the Eastern Mediterranean, Ruble 2017 11

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Gastrade said that the FLNG unit will have a storage capacity of 170.000 cubic meters with four regasification units, each with a 400 cubic meters of LNG per hour regasification capacity18.

3.5. Internal Transmission and Distribution System development

DESFA’s LNG plant in Revythousa is to be upgraded by adding a new cryogenic tank of 95.000 m3 giving a total capacity of 160.000 m3 with a parallel regasification potential upgrade of 1.400 m3/h. There will also be a filling point for trailers in order to start the road LNG transport. DESFA’s development plan will start getting implemented long after the current selling off events and will probably modified but indicatively today it is planned to expand several branches, install a new compressor station in Kipoi entry point, interconnect with TAP and FYROM, install metering/reducing stations in several points19.

EDA Attiki is about to expand its network in Athens whose development has many years ahead in order to be completed. On the other hand, Thessaloniki and Thessalia whose networks are in a quite advanced level will reach new cities in their geographical restricted area using CNG as stated in their 5-years development plans.

DEDA, or EDA rest of Greece, in their recently announced development plan are going to install 1.200 Km of distribution system in the biggest cities of Eastern Macedonia and Thrace, Central Macedonia and Central Greece until 2022 using CNG in some cases such as Orestiada, Giannitsa, Amfissa and Karpenisi.

In the chapter below, there will be a series of comparisons between pipeline connection of transmission networks and their alternatives (CNG, LNG) as well as distribution related data in order to come up with a proposal for connecting the main cities of the country to the natural gas system.

18 Bulgaria, Greece form task force to build Greek LNG terminal, Reuters, 2016 19 NGNS Development Plan 2017-2026, DESFA 12

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

4. Description of Penetration of Natural Gas Proposal

Following the description of the situation in natural gas networks in Greece today, accompanied by the future projects in terms of Transmission and Distribution, the main proposal of the penetration is about to take place.

4.1. Key assumptions

The main assumptions of this proposal are stated below:

1. The country is about to be split into regions, different from the administrative ones, for purposes of interaction, operation and control. Those regions are:  Thrace, Eastern and Central Macedonia  Western Macedonia, Epirus, Ionian Islands  Western and Central Greece  Peloponnese  Crete  North and South Aegean Islands 2. Both ongoing projects, TAP and the Revythousa LNG terminal upgrade are about to be completed and operating by the end of 2018. Those projects have been taken into account as operating in this study and they are crucial for it. 3. All the islands, the Ionian, the Aegean and Crete will convert or replace their diesel generators to natural gas, so that the costs can be compared with renewable sources of energy such as wind and or solar power generators. 4. Consumption in each region will be calculated according to the population of each one, adding an estimation of quantities needed for power generation and or industries that exist in those regions. Climate differences will also be taken into account.

4.2. Proposal Description

Concerning the first region, Thrace, Eastern and Central Macedonia, where the National Transmission system passes through, the proposal is mainly on distribution. This is because DESFA’s network is already running by most of the biggest cities, having predicted and constructed city gates and several Km of medium pressure networks have already been constructed in Alexandroupolis, Komotini, Xanthi,

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Drama and the wider region of Kavala. Local distribution companies must be founded in each of those cities, in order to reach a certain cover of network in the cities and the areas that surrounds them which are usually filled with industries.

The region of Western Macedonia, Epirus and the Ionian Islands is more complicated. There are no transmission networks in the area, although Trans Adriatic Pipeline is about to pass through Western Macedonia. There are two options available for this region, building an exit from TAP or building an LNG port in Igoumenitsa, which will have double operation, importing and refilling into vessels and refilling into ships. The vessels are to be used into road transport to Epirus and Western Macedonia where it will be regasified in order to be used in the largest cities and the ships to carry it to the Ionian Islands to cover both civil consumption and power generation.

Western and Central Greece have quite some differences because the national transmission system passes through Central Greece but Western Greece is without. For Central Greece, a CNG system will be studied because the size of the cities to be served is quite small and near the transmission network. Western Greece needs to be served with LNG and here we have two options, either from the existing terminal of Revythousa, or the proposed one in Igoumenitsa.

For the region of the Peloponnese, where an antenna of the transmission network that ends in Megalopolis in the Public Power Corporation plants of power generation is, exists, however the pipeline has not been built to serve the whole region. For that reason a comparison between replacing the existing pipeline, building a new one for Patra and several CNG stations needed to serve the rest of the cities and the solution of LNG road transport from Revythousa.

Crete needs to be accounted differently from the rest of the Islands, due to its size and needs of consumption in its biggest cities. There are also large power needs that can be served with natural gas. There will be a case where power needs can be covered by renewable sources as a whole, or parts of it. LNG loaded in Revythousa seems to be a one-way road for Crete, where it will be unloaded and regasified. The distribution

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE networks need to be built from one end to the other in order to build only one port for the whole island20.

The Islands of North and South Aegean are a complicated case. The main plan is for all of them to be covered with LNG, coming from Revythousa. Small scale ships will carry the LNG from Revythousa and unload on the biggest islands. There is the option of interconnection between islands that belong to a complex and can be easily connected with a subsea pipeline, as it has already been done in Turkey. The main point is that we will need to install the smallest number of regasification plants on the biggest size islands and connect the surrounding smaller ones. In terms of cost, such a system will be compared to the renewable sources one, so that we can compare and decide which gives us safety of power supply and on which islands that system can be applied.

20 The feasibility of the introduction of natural gas into the electricity production system in the island of Crete (Greece), Katsaprakakis et al, 2012 15

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

5. Proposal Study

For every region that is going to be studied, several formal data were used such as the last population census of 2011, the highest calorific value of 11.4 KWh/m3, which is announced monthly by DESFA, an estimation of penetration of 50% in 5 years as experience showed, a daily consumption according to data resulting from consumers in Thessaloniki, Thessaly and Athens and a monthly per yearly consumption according to the climate of every region. The construction cost is calculated as 70€/m for low pressure networks construction, 1000/service line construction and 380€/m for medium pressure networks construction. Subsea networks have been assumed to be at the cost of 1500€/m21.

5.1. Thrace, E. Macedonia, C. Macedonia

Evros regional unit

Table 1: Data, Assumptions

Description Amount Measuring unit HCV 11, 4 KWh/m3 Daily Consumption 12 m3/day Daily Consumption 0, 1368 MWh/day Yearly Consumption 8 months/year Penetration 50% % of total population

Table 2: Population, Consumptions

No. of Daily Monthly Yearly Populatio meter Cons.(MWh Cons.(MWh Cons.(MWh City/Area n s ) ) ) Alexandroupoli 18.24 s 72.959 0 1.248 37.428 299.424 Feres 5.457 1.364 93 2.799 22.396 Didymotiho 19.493 4.873 333 10.000 79.999

21 Franpipe, North Sea Project of 840 Km and budget of €1.15bn. 16

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Soufli 14.941 3.735 255 7.665 61.318 Orestiada 37.695 9.424 645 19.338 154.700 Total: 617.837 Table 3: Low Pressure and Service Lines cost

Low Pressure Netowrk No. of Total Network Construction Service Service Construction City/Area (m) Cost Lines Lines cost Cost Alexandroupolis 168.000 11.760.000 € 4.560 4.559.938 € 16.319.938 € Feres 25.000 1.750.000 € 341 341.063 € 2.091.063 € Didymotiho 30.000 2.100.000 € 1.218 1.218.313 € 3.318.313 € Soufli 31.000 2.170.000 € 934 933.813 € 3.103.813 € Orestiada 73.000 5.110.000 € 2.356 2.355.938 € 7.465.938 € Total: 32.299.063 €

For the city of Alexandroupolis there is already constructed the Metering & Regulating station by Desfa and several Km of medium pressure networks have already been constructed, so what’s left to do is the low pressure network in the city. For the rest of the cities, a Compressed Natural Gas (CNG) system is studied below in order to get compared with the construction of medium pressure networks. Three stations of CNG are needed, one to meet the needs of Feres and Soufli, the second for Didymotiho and the third for Orestiada.

Table 4: CNG stations and equipment cost

Distribution Station Cost of CNG Construction Routes/da CNG CNG Total CNG Station Cost y Vessels Vessels Cost CNG 1 800.000,00 € 5 6 900.000 € 1.700.000,00 € CNG 2 800.000,00 € 5 5 750.000 € 1.550.000,00 € CNG 3 1.200.000,00 € 9 6 900.000 € 2.100.000,00 € Total: 5.350.000,00 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Table 5: CNG Operating cost

Operating CNG Yearly Cost Total Operating Cost Station Consumption(MWh) (€/MWh) per Year CNG 1 83.713 11 920.847,31 € CNG 2 79.999 10 799.992,72 € CNG 3 154.700 8 1.237.602,24 € Total: 2.958.442,27 €

Table 6: Medium pressure network cost

Route Distance(m) Netowrk Construction Cost Alexandroupolis- Feres 28.000 10.640.000 € Feres-Soufli 36.000 13.680.000 € Soufli-Didymotiho 30.000 11.400.000 € Didymotiho- Orestiada 19.000 7.220.000 € Total: 42.940.000 €

Table 7: Comparison

Description Amount fixed costs 5.350.000,00 € operating costs per year 2.958.442,27 € no. of years to even out 15

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

The comparison between building the medium pressure networks and CNG stations in order to serve those cities shows that the construction of the network is preferred because 15 years return period is not such a big number compared to different kind of investments.

Rodopi regional unit

Table 1: Data, Assumptions

Description Amount Measuring unit HCV 11,4 KWh/m3 Daily Consumption 12 m3/day Daily Consumption 0,1368 MWh/day Yearly Consumption 7 months/year Penetration 50% % of total population

Table 2: Population, Consumptions

No. of Daily Monthly Yearly City/Area Population meters Cons.(MWh) Cons.(MWh) Cons.(MWh) Komotini 43.326 10.832 741 22.226 155.584 Iasmos 2.732 683 47 1.402 9.811 Xylagani 1.531 383 26 785 5.498 Sapes 3.754 939 64 1.926 13.481 Fillyra 1.032 258 18 529 3.706 Total: 188.079

Table 3: Low Pressure and Service Lines cost

Netowrk No. of Total Low Pressure Construction Service Service Construction City/Area Network (m) Cost Lines Lines cost Cost Komotini 137.000 9.590.000 € 2.708 2.707.875 € 12.297.875 € Iasmos 16.000 1.120.000 € 171 170.750 € 1.290.750 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Xylagani 18.000 1.260.000 € 96 95.688 € 1.355.688 € Sapes 13.000 910.000 € 235 234.625 € 1.144.625 € Fillyra 6.000 420.000 € 65 64.500 € 484.500 € Total: 16.573.438 € The medium pressure network passes by the city of Komotini and some Km of low pressure network have already been constructed, so the study will focus on the rest of the cities in the regional unit. Two CNG stations are proposed to be constructed, the first is to serve the cities of Iasmos and Xylagani and the second for Sapes and Fillyra.

Table 4: CNG stations and equipment cost

Distribution CNG Station CNG Cost of CNG Total CNG Station Construction Cost Routes/day Vessels Vessels Cost CNG 1 800.000,00 € 1 3 450.000 € 1.250.000,00 € CNG 2 800.000,00 € 1 3 450.000 € 1.250.000,00 € Total: 2.500.000,00 €

Table 5: CNG Operating cost

CNG Yearly Operating Station Consumption(MWh) Cost (€/MWh) Total Op. Cost per Year CNG 1 15.308 11 168.392,76 € CNG 2 17.187 16 274.984,42 € Total: 443.377,18 €

Table 6: Medium pressure network cost

Netowrk Construction Route Distance(m) Cost Komotini - Iasmos 18.000 6.840.000 € Komotini - Ksylagani 16.000 6.080.000 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Komotini - Fillyra 18.500 7.030.000 € Fillyra - Sapes 12.000 4.560.000 € Total: 24.510.000 € Table 7: Comparison

Description Amount fixed costs 2.500.000,00 € operating costs per year 443.377,18 € no. of years to even out 60

The comparison between building medium pressure networks and CNG systems clearly states that the return period of 60 years and obviously indicates for the solution of CNG for the cities around Komotini.

Xanthi regional unit

Table 1: Data, Assumptions

Description Amount Measuring unit

HCV 11,4 KWh/m3 Daily Consumption 12 m3/day Daily Consumption 0,1368 MWh/day Yearly Consumption 7 months/year Penetration 50% % of total population

Table 2: Population, Consumptions

No. of Daily Monthly Yearly City/Area Population meters Cons.(MWh) Cons.(MWh) Cons.(MWh) Xanthi 45.111 11.278 771 23.142 161.994 Neo Erasmio 1.053 263 18 540 3.781 Avdira 1.229 307 21 630 4.413 Genissea 1.858 465 32 953 6.672 Selero 1.726 432 30 885 6.198

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Total: 183.058

Table 3: Low Pressure and Service Lines cost

Low Pressure Netowrk No. of Total Network Construction Service Service Construction City/Area (m) Cost Lines Lines cost Cost 2.819.438 Xanthi 95.000 6.650.000 € 2.819 € 9.469.438 € Neo Erasmio 25.000 1.750.000 € 66 65.813 € 1.815.813 € Avdira 30.000 2.100.000 € 77 76.813 € 2.176.813 € Gennisea 31.000 2.170.000 € 116 116.125 € 2.286.125 € Selero 73.000 5.110.000 € 108 107.875 € 5.217.875 € Total: 20.966.063 €

The medium pressure network passes by the city of Xanthi and some Km of low pressure network have already been constructed, so the study will focus on the rest of the cities in the regional unit. Two CNG stations are proposed to be constructed, the first is to serve the cities of Neo Erasmio and Avdira and the second for Genissea and Selero.

Table 4: CNG stations and equipment cost

Distribution Cost of CNG Station CNG CNG Station Construction Cost Routes/day Vessels Vessels Total CNG Cost CNG 1 800.000,00 € 1 3 450.000 € 1.250.000,00 € CNG 2 800.000,00 € 1 3 450.000 € 1.250.000,00 € Total: 2.500.000,00 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Table 5: CNG Operating cost

CNG Yearly Operating Cost Station Consumption(MWh) (€/MWh) Total Op. Cost per Year CNG 1 8.195 11 90.141,28 € CNG 2 12.870 12 154.441,73 € Total: 244.583,01 €

Table 6: Medium pressure network cost

Netowrk Construction Route Distance(m) Cost Xanthi - Selero 5.000 1.900.000 € Xanthi - Genisea 10.000 3.800.000 € Genisea - Avdira 9.000 3.420.000 € Avdira - Neo Erasmio 11.000 4.180.000 € Total: 13.300.000 €

Table 7: Comparison

Description Amount fixed costs 2.500.000,00 € operating costs per year 244.583,01 € no. of years to even out 53

The comparison between building medium pressure networks and CNG systems clearly states that the return period of 53 years and obviously indicates for the solution of CNG for the cities around Xanthi.

Kavala & Drama regional units

Table 1: Data, Assumptions

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Description Amount Measuring unit

HCV 11,4 KWh/m3 Daily Consumption 12 m3/day Daily Consumption 0,1368 MWh/day Yearly Consumption 9 months/year Penetration 50% % of total population

Table 2: Population, Consumptions

No. of Daily Monthly Yearly City/Area Population meters Cons.(MWh) Cons.(MWh) Cons.(MWh) Kavala 58.663 14.666 1.003 30.094 270.847 Ag. Athanasios- Doxato 7.204 1.801 123 3.696 33.261 Drama 42.501 10.625 727 21.803 196.227 Prosotsani 3.937 984 67 2.020 18.177 Nevrokopi 2.072 518 35 1.063 9.566 Total: 528.079

Table 3: Low Pressure and Service Lines cost

Netowrk No. of Total Low Pressure Construction Service Service Construction City/Area Network (m) Cost Lines Lines cost Cost Kavala 188.000 13.160.000 € 3.666 3.666.438 € 16.826.438 € Ag. Athanasios- Doxato 63.000 4.410.000 € 450 450.250 € 4.860.250 € Drama 156.600 10.962.000 € 2.656 2.656.313 € 13.618.313 € Prosotsani 43.600 3.052.000 € 246 246.063 € 3.298.063 € Nevrokopi 29.000 2.030.000 € 130 129.500 € 2.159.500 € Total: 40.762.563 € The medium pressure network passes by the city of Drama and some Km of low pressure network have already been constructed, so the study will focus on the rest of

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE the cities in the regional unit. For the city of Kavala 24 Km are needed to be constructed in order to reach the city boarders. One CNG station is proposed to be constructed in the city of Drama in order to serve the cities of Ag. Athanasios-Doxato, Prosotsani and Nevrokopi.

Table 4: CNG stations and equipment cost

Distribution Station Cost of CNG Construction Routes CNG CNG Station Cost /day Vessels Vessels Total CNG Cost 1.050.00 CNG 1 800.000,00 € 3 7 0 € 1.850.000,00 € Total: 1.850.000,00 €

Table 5: CNG Operating cost

CNG Yearly Operating Cost Total Op. Cost per Station Consumption(MWh) (€/MWh) Year CNG 1 61.004 14 854.061,89 € Total: 854.061,89 €

Table 6: Medium pressure network cost

Netowrk Construction Route Distance(m) Cost Hrysoupoli - Kavala 24.000 9.120.000 € Drama - Ag. Athanasios- Doskato 9.800 3.724.000 € Drama - Prosotsani 16.270 6.182.600 € Prosotsani - Nevrokopi 23.000 8.740.000 € Total: 27.766.600 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Table 7: Comparison

Description Amount fixed costs 1.850.000,00 € operating costs per year 854.061,89 € no. of years to even out 24

In this case the medium pressure network construction of 24 Km between Hrysoupoli and Kavala is mandatory, but for the rest of the cities a CNG system solution is more profitable as the return period is 24 years. In a case of European or other subsidies, as happened before, the figure of 24 years is drawn to 10 and the network construction is viable.

Serres, Giannitsa, Naousa, Veroia regional units

Table 1: Data, Assumptions

Description Amount Measuring unit

HCV 11,4 KWh/m3 Daily Consumption 12 m3/day Daily Consumption 0,1368 MWh/day Yearly Consumption 7 months/year Penetration 50% % of total population

Table 2: Population, Consumptions

No. of Daily Monthly Yearly City/Area Population meters Cons.(MWh) Cons.(MWh) Cons.(MWh) Serres 54.266 13.567 928 27.838 194.869 Nigrita 5.566 1.392 95 2.855 19.988 Giannitsa 29.789 7.447 509 15.282 106.972

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Naousa 21.152 5.288 362 10.851 75.957 Veroia 43.158 10.790 738 22.140 154.980 Total: 552.766 Table 3: Low Pressure and Service Lines cost

Low Pressure Netowrk No. of Network Construction Service Service Total Construction City/Area (m) Cost Lines Lines cost Cost Serres 122.000 8.540.000 € 3.392 3.391.625 € 11.931.625 € Nigrita 27.000 1.890.000 € 348 347.875 € 2.237.875 € Giannitsa 52.000 3.640.000 € 1.862 1.861.813 € 5.501.813 € Naousa 28.000 1.960.000 € 1.322 1.322.000 € 3.282.000 € Veroia 88.000 6.160.000 € 2.697 2.697.375 € 8.857.375 € Total: 31.810.688 €

The medium pressure network passes by the city of Serres and some Km of low pressure network have already been constructed, so the study will focus on second biggest city in the regional unit, Nigrita. For the complex of cities west of Thessaloniki, Giannitsa, Naousa and Veroia three CNG stations are proposed to be constructed in Thessaloniki which is the closest network available in order each station to serve each city.

Table 4: CNG stations and equipment cost

Cost of CNG Distribution Station CNG CNG Total CNG Station Construction Cost Routes/day Vessels Vessels Cost CNG 1 800.000,00 € 1 2 300.000 € 1.100.000,00 € CNG 2 1.400.000,00 € 7 9 1.350.000 € 2.750.000,00 € CNG 3 1.400.000,00 € 5 7 1.050.000 € 2.450.000,00 € CNG 4 2.500.000,00 € 10 12 1.800.000 € 4.300.000,00 € Total: 10.600.000,00 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Table 5: CNG Operating cost

CNG Yearly Operating Cost Total Op. Cost per Station Consumption(MWh) (€/MWh) Year CNG 1 19.988 11 219.862,57 € CNG 2 106.972 12 1.283.667,59 € CNG 3 75.957 13 987.438,82 € CNG 4 154.980 13 2.014.744,91 € Total: 4.505.713,88 € Table 6: Medium pressure network cost

Route Distance(m) Netowrk Construction Cost Serres - Nigrita 28.000 10.640.000 € Thessaloniki - Giannitsa 37.000 14.060.000 € Thessaloniki Naousa 64.000 24.320.000 € Naousa - Veroia 18.000 6.840.000 € Total: 55.860.000 €

Table 7: Comparison

Description Amount fixed costs Serres 1.100.000,00 € fixed costs Giannitsa, Naousa, Veroia 9.500.000,00 € operating costs per year Serres 219.862,57 € operating costs per year Giannitsa, Naousa, Veroia 4.285.851,32 € no. of years to even out Serres 52 no. of years to even out Giannitsa, Naousa, Veroia 10

It is clear that in the case of Serres-Nigrita the medium pressure network is not preferred comparing to CNG, as the return period is 52 years. On the other hand, in

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE the complex of cities of Giannitsa, Naousa and Veroia, the return period of 10 years states clearly for network construction.

5.2. Western Macedonia, Epirus and Ionian Islands

Western Macedonia and Epirus

Table 1: Data, Assumptions

Description Amount Measuring unit HCV 11,4 KWh/m3 Daily Consumption 12 m3/day Daily Consumption 0,1368 MWh/day

Yearly Consumption 8 months/year Penetration 50% % of total population

Table 2: Population, Consumptions

Daily Monthly Yearly No. of Consumption Consumption Consumption City/Area Population meters (MWh) (MWh) (MWh) Florina 17.686 4.422 302 9.073 72.583 Ptolemaida 32.142 8.036 550 16.489 131.911 Kastoria 13.387 3.347 229 6.868 54.940 Kozani 41.066 10.267 702 21.067 168.535 Igoumenitsa 9.145 2.286 156 4.691 37.531 Metsovo 2.503 626 43 1.284 10.272 Ioannina 65.574 16.394 1.121 33.639 269.116 Arta 21.596 5.399 369 11.079 88.630 Preveza 19.042 4.761 326 9.769 78.148 Total: 911.667

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Table 3: Low Pressure and Service Lines cost

Netowrk No. of Total Low Pressure Construction Service Service Construction City/Area Network (m) Cost Lines Lines cost Cost Florina 45.500 3.640.000 € 1.105 1.105.375 € 4.745.375 € Ptolemaida 65.500 5.240.000 € 2.009 2.008.875 € 7.248.875 € Kastoria 78.000 6.240.000 € 837 836.688 € 7.076.688 € Kozani 130.000 10.400.000 € 2.567 2.566.625 € 12.966.625 € Igoumenitsa 22.000 1.760.000 € 572 571.563 € 2.331.563 € Metsovo 16.000 1.280.000 € 156 156.438 € 1.436.438 € Ioannina 230.000 18.400.000 € 4.098 4.098.375 € 22.498.375 € Arta 47.000 3.760.000 € 1.350 1.349.750 € 5.109.750 € Preveza 42.000 3.360.000 € 1.190 1.190.125 € 4.550.125 € Total: 67.963.813 €

In this stage, three possible scenarios will be examined. Due to the ongoing project of the Trans Adriatic Pipeline (TAP) which needs to have as many exits possible in order to produce more profits and the fact that the pipeline passes through a large part of Greece, an exit can be built to serve the region of Western Macedonia and Epirus in combination with the Ionian Islands, which consists of the first case. The proposed exit should be created outside Ptolemaida in a very close distance, just 5 Km. The second case is a Liquefied Natural Gas (LNG) at Igoumenitsa, which will function in both regasification and refill station for road transport to the cities. The last case examined is a combination of the first two, TAP is going to serve Western Macedonia and the LNG port Epirus.

Case 1: TAP

Table 4: TAP CAPEX

Route Distance(m) Netowrk Construction Cost

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

TAP Exit - Ptolemaida 5.000 3.000.000 € TAP Exit - Florina 60.000 36.000.000 € TAP Exit - Kastoria 44.000 26.400.000 € Ptolemaida - Kozani 30.000 18.000.000 € Kozani - Ioannina 150.000 90.000.000 € Ioannina - Arta 60.000 36.000.000 € Arta - Preveza 50.000 30.000.000 € Ioannina - Metsovo 50.000 30.000.000 € Ioannina - Igoumenitsa 80.000 48.000.000 € Total: 317.400.000 €

Table 5: TAP CAPEX

M/R station Construction Cost TAP Exit 30.000.000 € Florina 2.500.000 € Ptolemaida 3.000.000 € Kastoria 2.000.000 € Kozani 7.000.000 € Ioannina 14.000.000 € Arta 1.500.000 € Preveza 1.500.000 € Metsovo 400.000 € Igoumenitsa 700.000 € Total: 62.600.000 €

The total CAPEX for that case is 380.000.000€

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Case 2: LNG port in Igoumenitsa

Table 6: LNG port construction, Igoumenitsa

LNG Port Igoumenitsa Estimated Cost Port restructuring 30.000.000 € Cryogenic Storage Tanks 150.000.000 € Other Equipment 90.000.000 € Filling Points 10.000.000 € Total: 280.000.000 €

Table 7: Regasification units cost

Regasification Units Estimated Cost Florina 1.100.000 € Ptolemaida 2.500.000 € Kastoria 900.000 € Kozani 2.800.000 € Igoumenitsa 700.000 € Metsovo 350.000 € Ioannina 5.000.000 € Arta 1.400.000 € Preveza 1.200.000 € Total: 15.950.000 €

Table 8: LNG port OPEX road transport

Yearly Transport Consumption Distance Cost Total Op. Cost per City/Area (MWh) (Km) (€/MWh) Year Florina 72.583 283 3 217.750 € Ptolemaida 131.911 231 3 395.732 € Kastoria 54.940 227 3 164.821 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Kozani 168.535 205 2,7 455.044 € Metsovo 10.272 113 2,4 24.654 € Ioannina 269.116 78 2 538.231 € Arta 88.630 129 2,5 221.575 € Preveza 78.148 87 2 156.297 € Total: 2.174.104 €

Table 9: Case 2 to Case 1 comparison

Description Amount

fixed costs (Case 2) 295.950.000,00 € operating costs per year (Case 2) 2.174.103,85 € no. of years to even out (Case 2 vs Case 1) 46

It is obvious that the winning scenario is the LNG port. There is a huge difference in the CAPEX between the two solutions and the LNG OPEX is the number that makes the difference in order for the two cases to match during the years.

Case 3: Combination of TAP and LNG port

Table 10: TAP CAPEX

Route Distance(m) Netowrk Construction Cost TAP Exit - Ptolemaida 5.000 2.500.000 € TAP Exit - Florina 60.000 30.000.000 € TAP Exit - Kastoria 44.000 22.000.000 € Ptolemaida - Kozani 30.000 15.000.000 € Total: 69.500.000 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Table 11: TAP CAPEX

M/R station Construction Cost TAP Exit 30.000.000 € Florina 2.500.000 € Ptolemaida 3.000.000 € Kastoria 2.000.000 € Kozani 7.000.000 € Total: 44.500.000 €

Table 12: LNG CAPEX

LNG Port Igoumenitsa Estimated Cost Port restructuring 25.000.000 € Cryogenic Storage Tanks 75.000.000 € Other Equipment 45.000.000 € Filling Points 5.000.000 € Total: 150.000.000 €

Table 13: LNG CAPEX

Regasification Units Estimated Cost Igoumenitsa 700.000 € Metsovo 350.000 € Ioannina 5.000.000 € Arta 1.400.000 € Preveza 1.200.000 € Total: 8.650.000 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Table 14: LNG OPEX

Yearly Consumption Distance Transport Cost Total Operating Cost City/Area (MWh) (Km) (€/MWh) per Year Metsovo 10.272 113 2,4 24.654 € Ioannina 269.116 78 2 538.231 € Arta 88.630 129 2,5 221.575 € Preveza 78.148 87 2 156.297 € Total: 940.757 €

Table 15: Case 3 to Case 1 Comparison

Description Amount fixed costs (Case 3) 272.650.000,00 € operating costs per year (Case 3) 940.756,64 € no. of years to even out (Case 3 vs Case 1) 137

It is clear that Case 3 is even better in terms of both investment capital and operating expenditure. Case 1 is completely out of thinking if the decision was left only to capital needs, without taking into account supply safety reasons or competition with other transmission networks.

Table 16: Case 3 to Case 2 Comparison

Description Amount fixed costs (Case 3) 272.650.000,00 € operating costs per year (Case 3) 940.756,64 € no. of years to even out (Case 3 vs Case 2) 23

The winning scenario would be case 3, the combination of TAP and LNG port in Igoumenitsa. Combining the two scenarios, gives us a slightly smaller number in the capital expenditure which will make it more attractive to investors. The operating

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE expenditure difference between the two cases is the key number that constitutes case 3 the optimum one.

This scenario is convenient for the next examination, the Ionian Islands. A subsea network from Igoumenitsa to Kerkyra, from Preveza to Lefkada, Kefalonia, Ithaki and Zakynthos will be compared to a small scale LNG system service from Igoumenitsa to the Ionian Islands.

The common problem for all the islands is electricity which is derived today from oil. The proposal takes into account natural gas quantities needed to produce electricity in each island. For every household, 3.750 KWh are needed in a yearly basis which are converted to gas quantities as follows22.

Ionian Islands

Table 1: Data, Assumptions

Description Amount Measuring unit

HCV 11,4 KWh/m3 Daily Consumption 11 m3/day Daily Consumption 0,1254 MWh/day Yearly Consumption 7 months/year Penetration 50% % of total population Electricity consumption 3,75 MWh/year/household

Table 2: Population, Consumptions

No. of Daily Monthly Yearly City/Area Population meters Cons.(MWh) Cons.(MWh) Cons.(MWh) Kerkyra 104.371 26.093 1.636 49.080 343.563 Lefkada 25.720 6.430 403 12.095 84.664 Kefalonia 35.801 8.950 561 16.835 117.848 Zakynthos 40.758 10.190 639 19.166 134.165 Ithaki 3.180 795 50 1.495 10.468

22 Press Release: Research on Energy Consumption in Households, ELSTAT 2013 36

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Total: 690.708 Table 3: Electricity to gas quantities

Natural Gas needed No. of Yearly to produce electricity City/Area Population meters Consumption(MWh) (MWh) Kerkyra 104.371 26.093 97.848 313.113 Lefkada 25.720 6.430 24.113 77.160 Kefalonia 35.801 8.950 33.563 107.403 Zakynthos 40.758 10.190 38.211 122.274 Ithaki 3.180 795 2.981 9.540 Total: 196.716 629.490

Table 4: Low Pressure and Service Lines cost

Low Netowrk No. of Pressure Construction Service Service Total Construction City/Area Network (m) Cost Lines Lines cost Cost Kerkyra 70.000 5.600.000 € 6.523 6.523.188 € 12.123.188 € Lefkada 21.000 1.680.000 € 1.608 1.607.500 € 3.287.500 € Kefalonia 45.000 3.600.000 € 2.238 2.237.563 € 5.837.563 € Zakynthos 15.000 1.200.000 € 2.547 2.547.375 € 3.747.375 € Ithaki 10.000 800.000 € 199 198.750 € 998.750 € Total: 25.994.375 €

Case 1: Subsea Networks from TAP to the Islands

Table 5: Subsea pipeline cost

Netowrk Route Distance(m) Construction Cost Igoumenitsa - Kerkyra 32.000 48.000.000 € Preveza - Lefkada 16.000 24.000.000 € Lefkada - Kefalonia 79.000 118.500.000 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Kefalonia - Ithaki 26.000 39.000.000 € Kefalonia - Zakynthos 58.000 87.000.000 € Total: 316.500.000 €

The price of 1.500€/m is taken from other similar projects, as described above.

Table 6: Metering/Reducing Stations (M/R)

M/R station Construction Cost Kerkyra 15.000.000 € Lefkada 2.500.000 € Kefalonia 5.000.000 € Zakynthos 3.000.000 € Ithaki 1.000.000 € Total: 26.500.000 €

The total CAPEX for Case 1 would be 343.000.000€

Case 2: Small scale LNG service

Taking into account that the LNG Port is constructed in Igoumenitsa as stated in the previous section to serve road transport.

Table 7: LNG CAPEX

Regasification Units and Ports restructuring Estimated Cost Kerkyra 46.000.000 € Lefkada 32.000.000 € Kefalonia 34.000.000 € Zakynthos 31.400.000 € Ithaki 12.000.000 € Total: 155.400.000 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Table 8: LNG OPEX

Yearly Transport Consumption Distance Cost Total Op. Cost per City/Area (MWh) E+G (Km) (€/MWh) Year Kerkyra 656.676 32 3 1.970.029 € Lefkada 161.824 95 4 647.295 € Kefalonia 225.251 180 4,5 1.013.629 € Zakynthos 256.439 236 5 1.282.196 € Ithaki 20.008 211 4,5 90.035 € Total: 5.003.184 €

Table 9: Case 2 to Case 1 Comparison

Description Amount fixed costs (Case 2) 155.400.000,00 € operating costs per year (Case 2) 5.003.183,87 € no. of years to even out (Case 2 vs Case 1) 45

In this case a high cost of LNG regasification port is required for each island and a slightly low number for the operating cost which moves Case 2 into a heading position. The 45 period in order to match the two solutions is quite high and so, the LNG solution to the Ionian Islands is the most effective one.

5.3. Western and Central Greece

The area of Western Greece has no transmission network to be supplied with natural gas, on the contrary with Central Greece where DESFA’s network is a monopoly. Consequently, in Central Greece the cities of Leivadia and Thiva will be examined only in the cost of the distribution networks and the rest of the cities for a transmission network. In Evoia there isn’t any large city, so an industry which is quite interested is chosen instead.

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Table 1: Data, Assumptions

Description Amount Measuring unit HCV 11,4 KWh/m3 Daily Consumption 10 m3/day Daily Consumption 0,114 MWh/day

Yearly Consumption 6 months/year Penetration 50% % of total population

Table 2: Population, Consumptions

Daily Monthly Yearly Populat No. of Consumption Consumption Consumption City/Area ion meters (MWh) (MWh) (MWh) Agrinio 59.329 14.832 845 25.363 152.179 Mesologgi 12.785 3.196 182 5.466 32.794 Amfissa 6.946 1.737 99 2.969 17.816 Karpenisi 7.183 1.796 102 3.071 18.424 Leivadia 24.346 6.087 347 10.408 62.447 Thiva 22.883 5.721 326 9.782 58.695 Mantoudi Evoias-industry - 1 253 7.590 91.080 Total: 433.436

Table 3: Low Pressure and Service Lines cost

Netowrk No. of Total Low Pressure Construction Service Service Construction City/Area Network (m) Cost Lines Lines cost Cost Agrinio 146.000 11.680.000 € 3.708 3.708.063 € 15.388.063 € Mesologgi 27.000 2.160.000 € 799 799.063 € 2.959.063 € Amfissa 19.000 1.520.000 € 434 434.125 € 1.954.125 € Karpenisi 16.000 1.280.000 € 449 448.938 € 1.728.938 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Leivadia 52.000 4.160.000 € 1.522 1.521.625 € 5.681.625 € Thiva 47.000 3.760.000 € 1.430 1.430.188 € 5.190.188 € Mantoudi Evoias-industry - - 1 50.000 € 50.000 € Total: 32.952.000 €

In this case, three scenarios will be examined. The first is the network construction from the existing DESFA network. The second case is LNG road transport from Revythousa and the third scenario is a CNG system from each closest network to the cities.

Case 1: DESFA’s network

Table 4: Desfa’s network cost

Netowrk Construction Route Distance(m) Cost Lamia-Karpenisi 57.000 28.500.000 € Karpenisi-Agrinio 60.000 30.000.000 € Agrinio Mesologgi 27.000 13.500.000 € Leivadia-Amfissa 48.000 24.000.000 € Psachna-Mantoudi 40.000 20.000.000 € Total: 116.000.000 €

Table 5: Metering/Reducing stations

M/R station Construction Cost Karpenisi 1.000.000 € Agrinio 10.000.000 € Mesologgi 3.000.000 € Amfissa 1.000.000 € Mantoudi 1.000.000 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Total: 16.000.000 € The total CAPEX in this case comes up to 132.000.000€

Case 2: LNG road transport

LNG will be filled into special vehicles and get carried from Revythousa station to each city where a regasification station will be constructed.

Table 6: LNG CAPEX

Regasification Units Estimated Cost Karpenisi 800.000 € Agrinio 4.000.000 € Mesologgi 1.500.000 € Amfissa 500.000 € Mantoudi 2.500.000 € Total: 9.300.000 €

Table 7: LNG OPEX

Yearly Transport Consumption Distance Cost Total Op. Cost per City/Area (MWh) (Km) (€/MWh) Year Karpenisi 18.424 320 3,5 64.485 € Agrinio 152.179 240 3 456.537 € Mesologgi 32.794 204 2,5 81.984 € Amfissa 17.816 232 2,7 48.105 € Mantoudi 91.080 146 2,2 200.376 € Total: 851.486 €

Table 8: Case 2 to Case 1 Comparison

Description Amount fixed costs (Case 2) 9.300.000,00 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

operating costs per year (Case 2) 851.486 € no. of years to even out (Case 2 vs Case 1) 173

It’s clear that LNG road transport is the most effective way to serve these consumption points. A CNG system is to be examined in Case 3 and get compared with the LNG solution.

Case 3: CNG road transport

Table 9: CNG Stations cost

CNG Stations Estimated Cost Lamia 4.000.000 € Leivadia 1.500.000 € Psachna 1.800.000 € Total: 7.300.000 €

Table 10: CNG OPEX

Yearly Transport Consumption Distance Cost Total Op. Cost City/Area (MWh) (Km) (€/MWh) per Year Karpenisi 18.424 57 12 221.093 € Agrinio 152.179 60 12 1.826.147 € Mesologgi 32.794 27 9 295.142 € Amfissa 17.816 48 11 195.981 € Mantoudi 91.080 40 11 1.001.880 € Total: 3.540.242 €

Table 11: Case 3 to Case 1 comparison

Description Amount fixed costs (Case 3) 7.300.000,00 € operating costs per year (Case 3) 3.540.242 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

no. of years to even out (Case 3 to Case 1) 42

It’s obvious that CNG comparing to the network construction is more effective.

Table 13: Case 3 to Case 2 Comparison

Description Amount fixed costs (Case 3) 7.300.000,00 € operating costs per year (Case 3) 3.540.242 € no. of years to even out (Case 3 vs Case 2) -1

CNG appears to be less effective than the LNG road transport due to its higher operating expenditure although the CAPEX in the third case is lower, so the scenario of LNG road transport is selected for these areas which is more effective from the first year of operation.

5.4. Peloponnese

The Peloponnese consists of major cities such as Patra, Kalamata, and Aigio amongst others. The DESFA network passes by Korinthos and reaches Megalopoli, where the PPC electricity generators are supplied. Three cases will be examined here, continuing the DESFA network, LNG road transport from Revythousa and CNG from the existing pipeline to the major cities in every corner of the Peloponnese.

Table 1: Data, Assumptions

Description Amount Measuring unit HCV 11,4 KWh/m3 Daily Consumption 8 m3/day Daily Consumption 0,0912 MWh/day

Yearly Consumption 5 months/year Penetration 50% % of total population

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Table 2: Population, Consumptions

Daily Monthly Yearly No. of Consumption Consumption Consumption City/Area Population meters (MWh) (MWh) (MWh) Aigio 20.422 5.106 233 6.984 34.922 Patra 168.034 42.009 1.916 57.468 287.338 Amaliada 18.261 4.565 208 6.245 31.226 Pyrgos 24.359 6.090 278 8.331 41.654 Kranidi 4.006 1.002 46 1.370 6.850 Nafplio 14.203 3.551 162 4.857 24.287 Astros 2.285 571 26 781 3.907 Sparti 16.239 4.060 185 5.554 27.769 Kalamata 54.100 13.525 617 18.502 92.511 Gytheio 4.279 1.070 49 1.463 7.317 Total: 557.781

Table 3: Low Pressure and Service Lines cost

Netowrk No. of Low Pressure Construction Service Service Lines Total City/Area Network (m) Cost Lines cost Construction Cost Aigio 58.000 4.640.000 € 1.276 1.276.375 € 5.916.375 € Patra 568.000 45.440.000 € 10.502 10.502.125 € 55.942.125 € Amaliada 52.000 4.160.000 € 1.141 1.141.313 € 5.301.313 € Pyrgos 49.000 3.920.000 € 1.522 1.522.438 € 5.442.438 € Kranidi 22.000 1.760.000 € 250 250.375 € 2.010.375 € Nafplio 55.000 4.400.000 € 888 887.688 € 5.287.688 € Astros 23.000 1.840.000 € 143 142.813 € 1.982.813 € Sparti 60.000 4.800.000 € 1.015 1.014.938 € 5.814.938 € Kalamata 140.000 11.200.000 € 3.381 3.381.250 € 14.581.250 € Gytheio 15.000 1.200.000 € 267 267.438 € 1.467.438 € Total: 103.746.750 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Case 1: DESFA Network Cost

Table 4: DESFA CAPEX

Netowrk Construction Route Distance(m) Cost Korinthos-Aigio 98.000 49.000.000 € Aigio-Patra 39.000 19.500.000 € Patra-Amaliada 81.000 40.500.000 € Amaliada-Pyrgos 20.000 10.000.000 € Argos-Nafplio 11.500 5.750.000 € Nafplio-Kranidi 70.000 35.000.000 € Argos-Astros 32.000 16.000.000 € Megalopoli-Kalamata 57.000 28.500.000 € Kalamata-Sparti 30.000 15.000.000 € Sparti-Gytheio 40000 20.000.000 € Total: 239.250.000 €

Table 5: DESFA M/R CAPEX

M/R station Construction Cost Aigio 2.000.000 € Patra 10.000.000 € Amaliada 2.000.000 € Pyrgos 2.500.000 € Kranidi 600.000 € Nafplio 1.000.000 € Astros 500.000 € Sparti 1.600.000 € Kalamata 5.000.000 € Gytheio 600.000 € Total: 25.800.000 €

In Case 1 the total CAPEX comes up to 265.050.000€. 46

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Case 2: LNG road transport

Table 6: LNG CAPEX

Regasification Units Estimated Cost Aigio 800.000 € Patra 4.000.000 € Amaliada 1.200.000 € Pyrgos 1.700.000 € Kranidi 500.000 € Nafplio 1.200.000 € Astros 400.000 € Sparti 1.200.000 € Kalamata 2.000.000 € Gytheio 400.000 € Total: 8.200.000 €

Table 7: LNG OPEX

Yearly Transport Consumption Distance Cost Total Op. Cost per City/Area (MWh) (Km) (€/MWh) Year Aigio 40.815 135 3 122.444 € Patra 335.826 173 2,9 973.897 € Amaliada 36.496 255 3,5 127.735 € Pyrgos 48.683 240 3,4 165.522 € Kranidi 8.006 130 3 24.019 € Nafplio 28.386 100 2,7 76.641 € Astros 4.567 120 2,8 12.787 € Sparti 32.455 176 2,9 94.119 € Kalamata 108.122 200 3 324.367 € Gytheio 8.552 217 3,1 26.511 € Total: 1.948.040 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Table 8: Case 2 to Case 1 Comparison

Description Amount fixed costs (Case 2) 8.200.000,00 € operating costs per year (Case 2) 1.948.040 € no. of years to even out (Case 2 vs Case 1) 158

It’s obvious that 158 years to match the two cases, gives the LNG case a clear advantage.

Case 3: CNG road transport

Table 9: CNG CAPEX

CNG Stations Estimated Cost Korinthos 6.000.000 € Argos 700.000 € Megalopoli 1.400.000 € Total: 8.100.000 €

Table 10: CNG OPEX

Yearly Consumption Distance Transport Total Op. Cost per City/Area (MWh) (Km) Cost (€/MWh) Year Aigio 40.815 98 12 489.776 € Patra 335.826 137 12 4.029.917 € Amaliada 36.496 218 14 510.940 € Pyrgos 48.683 238 15 730.245 € Kranidi 8.006 82 11 88.069 € Nafplio 28.386 12 9 255.470 € Astros 4.567 32 10 45.667 € Sparti 32.455 50 10 324.547 € Kalamata 108.122 57 11 1.189.345 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Gytheio 8.552 90 12 102.622 € Total: 7.766.598 €

Table 11: Case 3 to Case 1 Comparison

Description Amount fixed costs (Case 3) 8.100.000,00 € operating costs per year (Case 3) 7.766.598 € no. of years to even out (Case 3 vs Case 2) 40

Table 12: Case 3 to Case 2 Comparison

Description Amount fixed costs (Case 3) 8.100.000,00 € operating costs per year (Case 3) 7.766.598 € no. of years to even out (Case 3 vs Case 2) -1,1

It’s clear that the second case, the LNG road transport from Revythousa to the Peloponnese gives the great advantage with the minimum expenditure in operation, with more or less the same capital expenditure and is the most effective one.

5.5. Crete

In the large island’s case of Crete, there will be studied both the distribution network inside the island and the transmission network from the mainland. For the distribution network the pipeline construction will be compared with the LNG road transport and unloading at every city and the last case of a combination of LNG and CNG system, LNG for importing the gas and CNG for distributing it. In this case, an LNG port must be constructed and it is proposed to be built at the center of the island, the city of Irakleio, so that any further network costs can be avoided, as the most expensive network cost will be required for this city. The CNG case will also be studied to be built in Irakleio for the same reason. Concerning the transmission network, the subsea network will be compared to the LNG system from Revythousa. Electricity generated

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE from natural gas will be taken into account, in the form of gas quantities needed to produce it.

Table 1: Data, Assumptions

Description Amount Measuring unit HCV 11,4 KWh/m3 Daily Consumption 8 m3/day Daily Consumption 0,0912 MWh/day Yearly Consumption 5 months/year Penetration 50% % of total population Electricity consumption 3,75 MWh/year/household

Table 2: Population, Consumptions

Daily Monthly Yearly No. of Consumption Consumption Consumption City/Area Population meters (MWh) (MWh) (MWh) Kissamos 4.236 1.059 48 1.449 7.244 Chania 53.910 13.478 615 18.437 92.186 Rethymno 34.300 8.575 391 11.731 58.653 Irakleio 140.730 35.183 1.604 48.130 240.648 Moires 5.872 1.468 67 2.008 10.041 Tympaki 5.007 1.252 57 1.712 8.562 Ag. Nikolaos 12.638 3.160 144 4.322 21.611 Ierapetra 16.139 4.035 184 5.520 27.598 Siteia 9.912 2.478 113 3.390 16.950 Total: 408.772

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Table 3: Electricity to gas quantities

Yearly No. of Consumption Natural Gas needed to City/Area Population meters (MWh) produce electricity (MWh) Kissamos 4.236 1.059 3.971 12.708 Chania 53.910 13.478 50.541 161.730 Rethymno 34.300 8.575 32.156 102.900 Irakleio 140.730 35.183 131.934 422.190 Moires 5.872 1.468 5.505 17.616 Tympaki 5.007 1.252 4.694 15.021 Ag. Nikolaos 12.638 3.160 11.848 37.914 Ierapetra 16.139 4.035 15.130 48.417 Siteia 9.912 2.478 9.293 29.736 Total: 265.073 848.232

Table 4: Low Pressure and Service Lines cost

Low Netowrk No. of Total Pressure Construction Service Service Construction City/Area Network (m) Cost Lines Lines cost Cost Kissamos 16.000 1.280.000 € 265 264.750 € 1.544.750 € Chania 190.000 15.200.000 € 3.369 3.369.375 € 18.569.375 € Rethymno 82.000 6.560.000 € 2.144 2.143.750 € 8.703.750 € Irakleio 420.000 33.600.000 € 8.796 8.795.625 € 42.395.625 € Moires 22.000 1.760.000 € 367 367.000 € 2.127.000 € Tympaki 24.000 1.920.000 € 313 312.938 € 2.232.938 € Ag. Nikolaos 35.000 2.800.000 € 790 789.875 € 3.589.875 € Ierapetra 48.000 3.840.000 € 1.009 1.008.688 € 4.848.688 € Siteia 30.000 2.400.000 € 620 619.500 € 3.019.500 € Total: 87.031.500 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Distribution Network

Case 1: Distribution pipeline network cost

Table 5: Pipeline construction cost

Netowrk Route Distance(m) Construction Cost Kissamos-Chania 33.000 14.850.000 € Chania-Rethymno 62.000 27.900.000 € Rethymno-Irakleio 81.000 36.450.000 € Irakleio-Moires 53.000 23.850.000 € Moires-Tympaki 12.000 5.400.000 € Irakleio-Ag. Nikolaos 62.500 28.125.000 € Ag. Nikolaos-Ierapetra 32.000 14.400.000 € Ieraptera-Siteia 59.000 26.550.000 € Total: 177.525.000 €

Table 6: Metering/Reducing Stations (M/R)

M/R station Construction Cost Kissamos 400.000 € Chania 1.500.000 € Rethymno 1.000.000 € Irakleio 4.000.000 € Moires 400.000 € Tympaki 400.000 € Ag. Nikolaos 600.000 € Ierapetra 800.000 € Siteia 500.000 € Total: 9.600.000 €

The total CAPEX for the Distribution network pipeline is 187.125.000€

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Case 2: LNG road transport

Table 7: LNG port restructuring cost

Regasification Units and Ports restructuring Estimated Cost Kissamos 1.000.000 € Chania 12.000.000 € Rethymno 10.000.000 € Irakleio 60.000.000 € Moires 1.000.000 € Tympaki 1.000.000 € Ag. Nikolaos 2.000.000 € Ierapetra 2.000.000 € Siteia 1.500.000 € Total: 90.500.000 €

Table 8: LNG Operating costs

Yearly Transport Consumption Distance Cost Total Op. Cost per City/Area (MWh) E+G (Km) (€MWh) Year Kissamos 19.952 176 3 59.855 € Chania 253.916 143 2,9 736.357 € Rethymno 161.553 81 2 323.106 € Irakleio 662.838 0 0 0 € Moires 27.657 53 2 55.314 € Tympaki 23.583 65 2 47.166 € Ag. Nikolaos 59.525 62,5 2 119.050 € Ierapetra 76.015 92 2,5 190.037 € Siteia 46.686 129 2,8 130.719 € Total: 1.661.604 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Table 9: Case 2 to Case 1 Comparison

Description Amount fixed costs (Case 2) 90.500.000,00 € operating costs per year (Case 2) 1.661.603,69 € no. of years to even out (Case 2 vs Case 1) 70

The LNG road transport is proven to be more profitable than building the distribution network inside Crete.

Case 3: LNG port and CNG distribution combination

Table 10: LNG port and CNG station CAPEX

LNG Port, CNG station Estimated Cost Irakleio 16.000.000 € Total: 16.000.000 € Table 11: CNG operating cost

Yearly Transport Consumption Distance Cost Total Op. Cost per City/Area (MWh) E+G (Km) (€/MWh) Year Kissamos 264.750 176 15 3.971.250 € Chania 3.369.375 143 14 47.171.250 € Rethymno 2.143.750 81 13 27.868.750 € Irakleio 8.795.625 0 0 0 € Moires 367.000 53 12 4.404.000 € Tympaki 312.938 65 12 3.755.250 € Ag. Nikolaos 789.875 62,5 12 9.478.500 € Ierapetra 1.008.688 92 13 13.112.938 € Siteia 619.500 129 14 8.673.000 € Total: 118.434.938 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Table 12: Case 3 to Case 1 Comparison

Description Amount fixed costs (Case 3) 16.000.000,00 € operating costs per year (Case 3) 118.434.937,50 € no. of years to even out (Case 3 vs Case 1) 2

Table 13: Case 3 to Case 2 Comparison

Description Amount fixed costs (Case 3) 16.000.000,00 € operating costs per year (Case 3) 118.434.937,50 € no. of years to even out (Case 3 vs Case 2) 1

Although the case of LNG in combination with CNG is proven by numbers to be the most efficient, the high cost of operation doesn’t conclude the same. For that reason, the high operating costs, the second case of LNG road transport is chosen.

Following the distribution analysis, transferring gas from the mainland to the island is the main problem which will be analyzed below.

Transmission network

Case 1: Subsea pipeline

Table 1: Subsea transmission network cost

Netowrk Route Distance(m) Construction Cost Megara-Kissamos 282.000 423.000.000 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Case 2: LNG transport

Table 1: LNG transmission system cost

Yearly Transport Operating Consumption Cost Cost per Route` Distance(m) (MWh)E+G (€/MWh) year Revythousa- Irakleio 350.000 1.257.004 7 8.799.029 €

Table 2: Case 2 to Case 1 Comparison

Description Amount fixed costs (Case 1) 423.000.000,00 € operating costs per year (Case 2) 8.799.028,56 € no. of years to even out (Case 2 vs Case 1) 58

It’s obvious that LNG transmission from Revythousa to Irakleio is a further better solution than the subsea pipeline. The cost of the LNG restructuring port at Irakleio isn’t calculated, as it is already chosen in the distribution scenarios. Concluding, LNG in both transmission and distribution is the most efficient scenario for Crete.

5.6. Northern and Southern Aegean Islands

Connecting the islands to the mainland has always been a huge talk between politicians and energy related people. This particular approach will reveal the optimum solution to the islands be connected to the mainland and interconnections between them. The population number used is the permanent habitants, although it is known that this number is tripled during the summer periods due to tourism. For that reason a more optimistic numbers selection on costs were used.

Northern Aegean Islands

Three scenarios will be examined. The subsea pipeline network from the mainland to each of the islands in a row, the small scale LNG from Alexandroupolis FSRU project, where gas can be filled into ships and delivered to each island and finally a

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE combination of mainland connection, interconnection and LNG will be studied. Quantities of gas needed for electricity generation are taken into account.

Table 1: Data, Assumptions

Description Amount Measuring unit

HCV 11,4 KWh/m3 Daily Consumption 7 m3/day Daily Consumption 0,0798 MWh/day Yearly Consumption 5 months/year Penetration 50% % of total population Electricity consumption 3,75 MWh/year/household

Table 2: Population, Consumptions

Daily Monthly Yearly No. of Consumption Consumption Consumption City/Area Population meters (MWh) (MWh) (MWh) Thasos 13.770 3.443 137 4.121 20.603 Samothraki 2.840 710 28 850 4.249 Limnos 17.000 4.250 170 5.087 25.436 Lesvos 86.436 21.609 862 25.866 129.330 Chios 51.320 12.830 512 15.358 76.788 Skiathos 6.160 1.540 61 1.843 9.217 Skopelos 4.696 1.174 47 1.405 7.026 Aloνnisos 2.750 688 27 823 4.115 Skyros 2.994 749 30 896 4.480 Total: 256.406

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Table 3: Electricity to gas quantities

Natural Gas needed to No. of Yearly Consumption produce electricity City/Area Population meters (MWh) (MWh) Thasos 13.770 3.443 12.909 41.310 Samothraki 2.840 710 2.663 8.520 Limnos 17.000 4.250 15.938 51.000 Lesvos 86.436 21.609 81.034 259.308 Chios 51.320 12.830 48.113 153.960 Skiathos 6.160 1.540 5.775 18.480 Skopelos 4.696 1.174 4.403 14.088 Aloνnisos 2.750 688 2.578 8.250 Skyros 2.994 749 2.807 8.982 Total: 176.218 563.898

There is no point analyzing the distribution networks in every island, so straight to the scenarios we have:

Case 1: Subsea connection to the mainland in a row

Table 1: Subsea network cost

On Off Onshore Subsea Total Shore Shore Netowrk Network Network Distance Distance Construction Construction Construction Route (m) (m) Cost Cost Cost Kavala-Thasos 24.000 8.000 9.600.000 21.600.000 € 31.200.000 € Alexandroupolis- Samothraki 47.000 70.500.000 € 70.500.000 € Samothraki- Limnos 50.000 75.000.000 € 75.000.000 € Limnos-Lesvos 77.000 115.500.000 € 115.500.000 € Lesvos-Chios 49.000 73.500.000 € 73.500.000 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Volos-Skiathos 27.000 17.000 10.800.000 25.500.000 € 36.300.000 € Skiathos- Skopelos 10.000 15.000.000 € 15.000.000 € Skopelos- Alonnisos 8.000 12.000.000 € 12.000.000 € Aliveri-Skyros 20.000 43.000 8.000.000 64.500.000 € 72.500.000 € Total: 501.500.000 €

Table 2: Metering/Reducing stations (M/R) cost

M/R Station Stations Cost Thasos 1.500.000 € Samothraki 400.000 € Limnos 2.000.000 € Lesvos 1.500.000 € Chios 1.500.000 € Skiathos 500.000 € Skopelos 400.000 € Alonnisos 400.000 € Skyros 400.000 € Total: 8.600.000 €

Case 2: Small scale LNG

It is fair to calculate the cost of the FSRU of Alexandroupolis in this case, which will be mostly used to serve the islands.

Table 3: FSRU and Regasification units cost

FSRU and Regasification Units Units cost Alexandroupolis FSRU 253.000.000 € Thasos 1.000.000 € Samothraki 500.000 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Limnos 800.000 € Lesvos 2.000.000 € Chios 1.500.000 € Skiathos 500.000 € Skopelos 500.000 € Aloνnisos 500.000 € Skyros 500.000 € Total: 260.800.000 €

Table 4: Small scale LNG Operating Cost

Yearly Transport Distance Consumption Cost Operating Route (Km) (MWh) E+G (€/MWh) Cost per year Alexandroupolis-Thasos 100 61.913 10 619.134 € Alexandroupolis-Samothraki 43 12.769 10 127.694 € Alexandroupolis-Limnos 110 76.436 10 764.363 € Alexandroupolis-Lesvos 180 388.638 11 4.275.017 € Alexandroupolis-Chios 270 230.748 13 2.999.718 € Alexandroupolis-Skiathos 275 27.697 16 443.150 € Alexandroupolis-Skopelos 265 21.114 16 337.830 € Alexandroupolis-Alonnisos 250 12.365 15 185.470 € Alexandroupolis-Skyros 250 13.462 15 201.927 € Total: 9.954.302€

Table 5: Case 2 to Case 1 Comparison

Description Amount fixed costs (Case 2) 260.800.000,00 € operating costs per year (Case 2) 9.954.301,83 € no. of years to even out (Case 2 vs Case 1) 30

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

It’s obvious that small scale LNG is more effective than connecting the Islands with the mainland.

Case 3: Combination of connecting Islands to the mainland, interconnecting Islands and small scale LNG

Some islands are very close to the mainland, such as Thasos, others are very close between them, such as the Sporades and others are quite far from the mainland or from each other. In that case a combination is to be examined below. Due to less quantities needed for the FSRU in Alexandroupolis, the cost of procurement of such a plant is reduced significantly by 73.000.000€.

Table 6: Connecting islands cost

On Off Onshore Subsea Total Shore Shore Netowrk Network Network Distance Distance Construction Construction Construction Route (m) (m) Cost Cost Cost Kavala-Thasos 24.000 8.000 9.600.000 € 21.600.000 € 31.200.000 € Volos-Skiathos 27.000 17.000 10.800.000 € 25.500.000 € 36.300.000 € Skiathos-Skopelos 10.000 15.000.000 € 15.000.000 € Skopelos-Alonnisos 8.000 12.000.000 € 12.000.000 € Total: 94.500.000 €

Table 7: Metering/Reducing (M/R) Stations cost

M/R Station Stations Cost Thasos 1.500.000 € Skiathos 500.000 € Skopelos 400.000 € Alonnisos 400.000 € Skyros 400.000 € Total: 3.200.000 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Table 8: FSRU and Regasification units cost

FSRU and Regasification Units Units cost Alexandroupolis FSRU 180.000.000 € Samothraki 500.000 € Limnos 800.000 € Lesvos 2.000.000 € Chios 1.500.000 € Skyros 500.000 € Total: 185.300.000 €

The total CAPEX for Case 3 is 283.000.000€

Table 9: Small scale LNG OPEX

Yearly Transport Distance Consumption Cost Operating Route (Km) (MWh) E+G (€/MWh) Cost per year Alexandroupolis- Samothraki 43 12.769 10 127.694 € Alexandroupolis-Limnos 110 76.436 10 764.363 € Alexandroupolis-Lesvos 180 388.638 11 4.275.017 € Alexandroupolis-Chios 270 230.748 13 2.999.718 € Alexandroupolis-Skyros 250 13.462 15 201.927 € Total: 8.368.717

Table 10: Case 3 to Case 1 comparison

Description Amount fixed costs (Case 3) 283.000.000,00 € operating costs per year (Case 3) 8.368.717,25 € no. of years to even out (Case 3 vs Case 2) 33

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Table 11: Case 3 to Case 2 comparison

Description Amount fixed costs (Case 3) 283.000.000,00 € operating costs per year (Case 3) 8.368.717,25 € no. of years to even out (Case 3 vs Case 2) -2

It can be easily derived that Case 1 is out of the picture. On the contrary, the two left cases compete quite strong with each other. The third case is the optimum one, due to a smaller number of operating cost, which over the years will come up to a significant number.

Southern Aegean Islands

The islands of southern Aegean will be examined below with the same terms as above, with the difference that in the third case, they can only be interconnected between them as they are all far away from Athens.

Table 1: Data, Assumptions

Description Amount Measuring unit HCV 11,4 KWh/m3 Daily Consumption 7 m3/day Daily Consumption 0,0798 MWh/day Yearly Consumption 5 months/year Penetration 50% % of total population Electricity consumption 3,75 MWh/year/household

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Table 2: Population, Consumptions

Daily Monthly Yearly No. of Consumption Consumption Consumption City/Area Population meters (MWh) (MWh) (MWh) Andros 9.128 2.282 91 2.732 13.658 Tinos 8.699 2.175 87 2.603 13.016 Mykonos 14.165 3.541 141 4.239 21.194 Syros 21.473 5.368 214 6.426 32.129 Serifos 1.378 345 14 412 2.062 Sifnos 2.543 636 25 761 3.805 Milos 4.966 1.242 50 1.486 7.430 Paros 13.629 3.407 136 4.078 20.392 Naxos 18.340 4.585 183 5.488 27.441 Santorini 17.430 4.358 174 5.216 26.080 Samos 33.335 8.334 333 9.975 49.877 Ikaria 8.431 2.108 84 2.523 12.615 Kos 33.388 8.347 333 9.991 49.957 Kalymnos 15.863 3.966 158 4.747 23.735 Rhodes 152.538 38.135 1.522 45.647 228.235 Karpathos 6.709 1.677 67 2.008 10.038 Total: 82.059

Table 3: Electricity to gas quantities

No. of Yearly Consumption Natural Gas needed to City/Area Population meters (MWh) produce electricity (MWh) Andros 9.128 2.282 8.558 27.384 Tinos 8.699 2.175 8.155 26.097 Mykonos 14.165 3.541 13.280 42.495 Syros 21.473 5.368 20.131 64.419 Serifos 1.378 345 1.292 4.134 Sifnos 2.543 636 2.384 7.629

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Milos 4.966 1.242 4.656 14.898 Paros 13.629 3.407 12.777 40.887 Naxos 18.340 4.585 17.194 55.020 Santorini 17.430 4.358 16.341 52.290 Samos 33.335 8.334 31.252 100.005 Ikaria 8.431 2.108 7.904 25.293 Kos 33.388 8.347 31.301 100.164 Kalymnos 15.863 3.966 14.872 47.589 Rhodes 152.538 38.135 143.004 457.614 Karpathos 6.709 1.677 6.290 20.127 Total: 339.389 1.086.045

A road from Athens to Andros is selected as the shortest way to connect the first and closest island and from Andros goes to the rest of the islands covering the most populated of them and the ones that attract the most tourists during the summer period, which means that they will need most of the quantities to produce electricity.

Case 1: Subsea network connection in a row

Table 4: Subsea network construction cost

On Off Onshore Subsea Total Shore Shore Netowrk Network Network Distance Distance Construction Construction Construction Route (m) (m) Cost Cost Cost Athens-Andros 22.000 62.000 8.800.000 € 93.000.000 € 101.800.000 € Andros-Tinos 3.000 4.500.000 € 4.500.000 € Tinos-Mykonos 9.000 13.500.000 € 13.500.000 € Tinos-Syros 24.000 36.000.000 € 36.000.000 € Syros-Serifos 38.000 57.000.000 € 57.000.000 € Serifos-Sifnos 17.000 25.500.000 € 25.500.000 € Sifnos-Milos 31.000 46.500.000 € 46.500.000 € Mykonos-Naxos 27.000 40.500.000 € 40.500.000 € Naxos-Paros 11.000 16.500.000 € 16.500.000 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Naxos-Santorini 62.000 93.000.000 € 93.000.000 € Mykonos-Ikaria 48.000 72.000.000 € 72.000.000 € Ikaria-Samos 21.000 31.500.000 € 31.500.000 € Ikaria-Kalymnos 93.000 139.500.000 € 139.500.000 € Kalymnos-Kos 13.000 19.500.000 € 19.500.000 € Kos-Rhodes 85.000 127.500.000 € 127.500.000 € Rhodes- Karpathos 57.000 85.500.000 € 85.500.000 € Total: 910.300.000 €

Table 5: Metering/Reducing (M/R) stations cost

M/R Station Stations Cost Andros 500.000 € Tinos 500.000 € Mykonos 1.000.000 € Syros 800.000 € Serifos 400.000 € Sifnos 400.000 € Milos 400.000 € Paros 600.000 € Naxos 1.000.000 € Santorini 1.000.000 € Samos 1.000.000 € Ikaria 700.000 € Kos 1.000.000 € Kalymnos 500.000 € Rhodes 2.800.000 € Karpathos 500.000 € Total: 13.100.000 €

The CAPEX for Case 1 comes to 923.400.000€.

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Case 2: Small scale LNG

In this case, an upgrade of Revythousa station is necessary. The routes have been chosen according to the optimum routes for the ships, concerning quantities, orientation and grouping.

Table 6: Small scale LNG CAPEX

LNG upgrade and Regasification Units Units cost Revythousa upgrade 250.000.000 € Andros 700.000 € Tinos 700.000 € Mykonos 1.500.000 € Syros 1.000.000 € Serifos 600.000 € Sifnos 600.000 € Milos 600.000 € Paros 800.000 € Naxos 1.300.000 € Santorini 1.500.000 € Samos 1.500.000 € Ikaria 1.000.000 € Kos 1.300.000 € Kalymnos 600.000 € Rhodes 3.000.000 € Karpathos 700.000 € Total: 267.400.000 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Table 7: Small scale LNG OPEX

Yearly Transport Distance Consumption Cost Operating Cost per Route (Km) (MWh) E+G (€/MWh) year Revythousa-Andros 155 41.042 13 533.543 € Andros-Tinos 50 39.113 10 391.129 € Tinos-Mykonos 32 63.689 10 636.894 € Mykonos-Syros 40 96.548 10 965.480 € Revythousa-Serifos 160 6.196 13 80.546 € Serifos-Sifnos 22 11.434 10 114.340 € Sifnos-Milos 50 22.328 10 223.284 € Revythousa-Paros 210 61.279 13 796.632 € Paros-Naxos 35 82.461 10 824.612 € Naxos-Santorini 85 78.370 11 862.066 € Revythousa-Ikaria 270 149.882 14 2.098.355 € Ikaria-Samos 80 37.908 11 416.987 € Samos-Kalymnos 111 150.121 14 2.101.691 € Kalymnos-Kos 30 71.324 10 713.240 € Revythousa-Rhodes 510 685.849 15 10.287.735 € Rhodes-Karpathos 150 30.165 12 361.984 € Total: 21.408.517

Table 8: Case 2 to Case 1 comparison

Description Amount fixed costs (Case 2) 267.400.000,00 € operating costs per year (Case 2) 21.408.516,69 € no. of years to even out (Case 2 vs Case 1) 37

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Case 3: Subsea pipeline interconnecting islands and small scale LNG

In this case, a lower number is used for the upgrade of Revythousa. Several islands are interconnected and the chosen islands are the ones that are the closest from each other.

Table 9: Interconnection cost

Subsea Network Route Off Shore Distance (m) Construction Cost Andros-Tinos 3.000 4.500.000 € Tinos-Mykonos 9.000 13.500.000 € Naxos-Paros 11.000 16.500.000 € Ikaria-Samos 21.000 31.500.000 € Kalymnos-Kos 13.000 19.500.000 € Total: 85.500.000 €

Table 10: Metering/Reducing (M/R) stations cost

M/R Station Stations Cost Tinos 500.000 € Mykonos 1.000.000 € Paros 600.000 € Samos 1.000.000 € Kos 1.000.000 € Total: 4.100.000 €

Table 11: LNG Revythousa upgrade and Regasification units cost

LNG upgrade and Regasification Units Units cost Revythousa upgrade 100.000.000 € Andros 700.000 € Syros 1.000.000 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Serifos 600.000 € Sifnos 600.000 € Milos 600.000 € Naxos 1.300.000 € Santorini 1.500.000 € Ikaria 1.000.000 € Kalymnos 600.000 € Rhodes 3.000.000 € Karpathos 700.000 € Total: 111.600.000 €

Table 12: Small scale LNG OPEX

Yearly Transport Distance Consumption Cost Operating Cost Route (Km) (MWh) E+G (€/MWh) per year Revythousa-Andros-Syros 210 240.392 12 2.884.704 € Revythousa-Serifos-Sifnos- Milos 232 39.958 12 479.498 € Revythousa-Paros- Santorini 315 222.110 13 2.887.433 € Revythousa-Ikaria- Kalymnos 365 409.235 14 5.729.293 € Revythousa-Rhodes- Karpathos 660 716.014 15 10.740.215 € Total: 22.721.143

Table 13: Case 3 to Case 1 comparison

Description Amount fixed costs (Case 3) 201.200.000,00 € operating costs per year (Case 3) 22.721.142,92 € no. of years to even out (Case 3 vs Case 2) 38

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Table 14: Case 3 to Case 2 comparison

Description Amount fixed costs (Case 3) 201.200.000,00 € operating costs per year (Case 3) 22.721.142,92 € no. of years to even out (Case 3 vs Case 2) 5

Comparing the three cases, the conclusion is that the third case is the most efficient. Interconnected group of Islands, reduces the initial investment significantly and even the operational cost is slightly higher, it would need more than 30 years to match case 2. It is also easier to manage and more efficient in the ground staff needed to operate all that system.

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

6. Conclusion and Discussion

Concluding the previous chapter, where the whole of the Greek territory was studied in order to find the optimum solution for natural gas penetration in the major cities of every region, the most effective solutions in terms of cost are given below.

For the region of Thrace, Eastern and Central Macedonia it has been chosen the network construction from DESFA for the cities of Alexandroupolis, Feres, Didymotiho, Soufli, Orestiada, Giannitsa, Naousa and Veroia and due to small distances at the rest of the cities, the CNG service.

Table 1: Thrace, Eastern and Western Macedonia cost

Total Yearly Thrace, Eastern and Total Consumption Amount Western Macedonia Population (MWh) CAPEX 60.390.000 € 522.205 2.069.819 OPEX 1.761.885 €

For the region of Western Macedonia, Epirus and the Ionian Islands, a combination of network solution from TAP to the cities of Florina, Ptolemaida, Kastoria and Kozani is chosen in addition to a new LNG port be built in Igoumenitsa which will serve the cities of Igoumenitsa, Metsovo, Ioannina, Arta, Preveza and the Ionian Islands.

Table 2: Western Macedonia, Epirus and the Ionian Islands

Western Macedonia, Total Yearly Total Epirus, Ionian Consumption Amount Population Islands (MWh) CAPEX 428.050.000 € 431.971 2.231.865 OPEX 5.943.941 €

Concerning the region of Western and Central Greece, both solutions of network construction and CNG were rejected and the optimum solution has been the LNG

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE road transport from Revythousa, where the filling station is already in DESFA’s plans for the end of 2018 to become operational.

Table 3: Western and Central Greece

Total Yearly Western and Total Consumption Amount Central Greece Population (MWh) CAPEX 9.300.000 € 133.472 433.436 OPEX 851.486 €

The area of the Peloponnese, where the DESFA’s network passes by Korinthos and goes up to Megalopoli, at the PCC’s electricity generation plants, is found as the best solution to be served with LNG by road transport from Revythousa, as compared to networks there is a tremendous difference of amounts invested to build the network.

Table 4: Peloponnese

Total Yearly Total Peloponnese Consumption Amount Population (MWh) CAPEX 8.200.000 € 326.188 557.781 OPEX 1.948.040 €

The big Island of Crete, has been studied in both transmission and distribution inside the island, since the distances allowed for it. The major cities from one end to the other are taken into account and the result is that an LNG port need to be built in Irakleio, which is at the center of the island and LNG road transport is preferred to network construction and CNG. It is mentioned here, that the quantities of natural gas needed have taken into account electricity generation which is by far cheaper than today’s old oil generators.

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Table 5: Crete

Total Yearly Crete Total Population Consumption Amount (MWh) CAPEX 90.500.000 € 282.744 1.257.004 OPEX 10.460.632 €

The most difficult case, the islands of Northern and Southern Aegean, in terms of consumption per island have been examined in the cases of building subsea networks between them and the mainland, small scale LNG from Alexandroupolis for the Northern and from Revythousa for the Southern and lastly but proven the most efficient, a combination of them due to the small distance of specific islands from the mainland (Thasos) in addition with interconnections due to the small distance that separates several groups of them (Andros-Tinos-Mykonos etc.).

Table 6: Northern and Southern Aegean Islands

Northern and Total Yearly Southern Total Consumption Amount Aegean Population (MWh) Islands CAPEX 462.000.000 € 549.981 1.988.408 OPEX 32.675.445 €

Concluding the big picture of the proposal, several Km of network are to be constructed either getting gas from DESFA or TAP, two new LNG ports in Igoumenitsa and Irakleio must be built, the FSRU in Alexandroupolis should be completed and several LNG and CNG vessels will flood the land and sea roads of the country. A synoptic table of all Greek regions below show us the total amount that need to be spent and the operating cost per year.

Table 7: Greece

Total Total Yearly Greece Population Consumption (MWh) Amount CAPEX 1.058.440.000 € 2.246.561 8.538.313 OPEX 53.641.429 €

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Given the fact that most of the population in the country is gathered in Athens, Thessaloniki, Thessaly and several other dispersed cities, where gas is already provided to them, the rest 2.250.000 of Greek population needs more than one billion euro in order to get connected to natural gas. They also need 53 mil euro of yearly operational expenditure in order to cover the 8.5 GWh needed and this is only for heating purposes, excluding transport and industries, except for the islands where quantities of electricity generation are included. With a rough calculation it will need more than 30 years for the initial investment to get depreciated, which isn’t the best of investments. On the other hand, it is a good opportunity for the country in the economic situation that is in, to import foreign investors to build these networks, virtual or real, and operate them for the common interest.

The natural gas market in Greece needs a good plan as the one described in order to create the networks, regulation for all areas of the territory, rest of the mainland and islands, foreign investors who are willing to bring their money and internal ones to operate the virtual networks with guaranteed, hence regulated incomes. More players from the world gas market need to be invited to participate in the providers market to increase competition, so that consumers get the best price and finally, the natural gas exchange market needs to grow in this country to match the European launching system of gas trading. It is also believed that geo-strategically and in matters of size, a consumer is treated more seriously when his internal market is grown and consuming than in the stage that it is today. It is all a political decision in the end.

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

7. References

1. Impact of natural gas consumption on CO2 emissions: Panel data evidence from China’s provinces, Kangyin Dong et al, 2017 2. 2364/1995 Establishment of the Energy Audit and Planning Body. Import, transport, marketing and distribution of natural gas and other provisions. 3. 2773/1999 Eligible Customers’ Supply Code, Second Draft 4. 4001/2011 For the operation of Electricity and Gas Energy Markets, for Exploration, Production and transmission networks of Hydrocarbons and other provisions. 5. Pension provisions - Ratification of the Draft Financial Contribution Agreement by the European Stability Mechanism and arrangements for implementing the Financing Agreement.(3rd Memorandum) 2015 6. OECD country report Greece, 2015 7. International Energy Agency report: Greece, 2014 8. NGNS Development Programme 2016-2025, DESFA 9. Adoption of the Paris Agreement, Draft decision -/CP.21, 2015 10. Treaty of Lisbon amending the Treaty on European Union and the Treaty establishing the European Community, 2007 11. Multicriteria decision support to evaluate potential long-term natural gas supply alternatives: The case of Greece, Androulaki-Psarras, 2016 12. The Trans-Anatolian Pipeline (TANAP) as a unique project in the Eurasian gas network: A comparative analysis, Ozdemir et al, 2015 13. EU's external energy governance: A multidimensional analysis of the southern gas corridor, Abbasov 2013 14. Commission Delegated Regulation 2016/89 15. European Union energy supply security: The benefits of natural gas imports from the Eastern Mediterranean, Ruble 2017 16. ICGB AD, 2017 17. European Union energy supply security: The benefits of natural gas imports from the Eastern Mediterranean, Ruble 2017 18. Bulgaria, Greece form task force to build Greek LNG terminal, Reuters, 2016 19. NGNS Development Plan 2017-2026, DESFA

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

20. The feasibility of the introduction of natural gas into the electricity production system in the island of Crete (Greece), Katsaprakakis et al, 2012 21. Franpipe, North Sea Project of 840 Km and budget of €1.15bn. 22. Press Release: Research on Energy Consumption in Households, ELSTAT 2013

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

8. Appendices

8.1. DESFA Transmission Network

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Length BRANCHES OF NATIONAL NATURAL GAS TRANSMISSION SYSTEM (Km) Antikyra Branch (Mavroneri Viotia – AdG) 28,06 Komotini/Kipi Branch (Karperi Serres – Kipi Evros) 300,25 Platy Branch (Trikala Imathia – Platy Imathia) 10,97 Lavrio Branch (Patima Magoulas – Lavrio Attica) 101,60 Keratsini Branch (Patima Magoulas – Keratsini Attica) 24,42 HAR Branch (Aspropyrgos - Athens HAR) 1,81 Ag. Theodori Branch (Megara Attica – Motor Oil Korinthos) 42,00 Volos Branch (Ambelia Farsala – Volos) 40,87 Trikala Branch (Ambelia Farsala – Trikala) 71,93 Inofyta Branch (Assopos – Inofyta) 20,57 EKO Branch (Pentalofos – Diavata Thessaloniki – ΕΚΟ) 9,74 Heron Branch (near Thiva in Viotia) 0,65 Asvestochori Branch (Drymos – Asvestochori Thessaloniki) 24,73 Thisvi Branch (Vagia Viotia – Thisvi Viotia) 28,13 Aliveri Branch (Stefani Viotia – Aliveri Evia) 73,19 Megalopoli Branch (Agioi Theodoroi - Megalopoli) 167,99

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

8.2. DEDA Distribution Network

Thrace, Eastern Macedonia

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Central Macedonia

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Central Greece

DIMITRIOS A. SOURLAS 2017 THE PERSPECTIVE OF PENETRATION OF NATURAL GAS IN GREECE

Korinthos – Peloponnese