Working Paper No. 3

ENERGY DEMOCRACY IN GREECE SYRIZA’s Program and the Transition to Renewable Power Table of Contents

Energy Democracy in Greece

SYRIZA’s Program and the Transition to Renewable Power...... 1

By Sean Sweeney Introduction...... 1 SYRIZA’s Program and Energy Democracy...... 1 Another Energy Is Possible ...... 2 Greece and the EU’s Neoliberal Energy Policy...... 3 Fossil Fuel Dependence and Greece’s Changing Climate...... 3 The EU’s Neoliberal Approach to Energy...... 4 Electricity Privatization in Greece...... 5 Green Colonization...... 6 EU policy at an Impasse ...... 7 Resisting “Resource Nationalism”...... 7 Developing and Implementing Energy Democracy...... 8 Short- and long-term goals...... 8 1. Re-Establish Control over Energy...... 9 2. Develop and Implement a National Energy Transition Plan...... 10 3. Promote Energy Independence...... 11 4. Decentralize Energy Production...... 13 The International Experience ...... 14 Energy Cooperatives ...... 17 A Reformed and Restructured PPC...... 18 Centralized or Decentralized Renewables?...... 18 Municipalization in Germany...... 18 Job Creation in Renewables...... 20 How to Finance the Transition?...... 21 Conclusion...... 22 References...... 24

Published by Trade Unions for Energy Democracy (TUED), in cooperation with the Rosa Luxemburg Stiftung—New York Office and the Global Labor Institute at Cornell University, January 2015

With support from the German Federal Ministry for Economic Cooperation and Development (BMZ).

Disclaimer: This paper represents the views of its author, Sean Sweeney. The opinions expressed here may or may not be consistent with the policies and positions of unions participating in TUED. The paper is offered for discussion and debate.

Trade Unions for Energy Democracy (TUED) is a global, multi-sector initiative to advance democratic direction and control of energy in a way that promotes solutions to the climate crisis, energy poverty, the degradation of both land and people, and responds to the attacks on workers’ rights and protections.

www.energydemocracyinitiative.org Energy Democracy in Greece

SYRIZA’s Program and the Transition to Renewable Power

By Sean Sweeney

Since the financial crisis of 2008 and the sub- er and perhaps an exemplar for a new course? sequent “Great Recession,” governments have Can a SYRIZA or SYRIZA-led government break mostly scaled back or deemphasized their cli- new ground in terms of fusing a viable left- mate protection and “green” commitments.1 green project in the face of crushing odds? Lack of public funds and concerns about growth, competitiveness, and unemployment are frequently cited as explanations for this ap- SYRIZA’s Program and Energy Demo- parent loss of both ambition and urgency. The cracy “green growth” narrative that colored various countercyclical “stimulus” spending packages The paper is divided into two parts. Part One from 2009-10 has been largely abandoned. attempts to take stock of the present impasse This has in turn slowed the deployment of re- of the neoliberal approach to energy and cli- newable energy and thrown the UN climate mate protection being pushed by the Europe- negotiations into paralysis. During the recent an Union (EU). Part Two pays attention to pos- talks in Lima (COP 20) it became clear that a sible programmatic options for SYRIZA and the global climate agreement seems very unlikely Greek Left, offering ideas for a plan of action to emerge from the “deadline COP” in Paris in on energy and climate change that could pro- late 2015. vide the basis for a new approach anchored by the concept energy democracy. The goal of this paper is to show how economic crisis and austerity, which today serves as the Energy democracy is entirely consistent with perfect cover for inaction and reversals on cli- SYRIZA’s existing programmatic commitments, mate protection and ecological sustainability, in several important respects. The party aims could actually spur a radical departure from to work toward “the development of a new the slow and stuttering progress of the recent paradigm of social, environmental and eco- past.2 The paper looks at the opportunities for nomic development.”4 SYRIZA’s program also such a departure in Greece, a country mired in acknowledges the challenge of climate change, debt, high unemployment, and on the receiv- and the need to pivot away from extractivist ing end of a full-blown austerity program. But energy policies that serve to make the problem Greece is also a country where the radical Left of climate change and ecological degradation could soon be in power led by a party, SYRIZA, worse than it already is. Importantly, it also that’s committed to nothing less than the “eco- commits to a “planned transition to renewable logical transformation of the economy.”3 energy.” SYRIZA has also pledged to “set the banking system under public ownership and But how can such a transformation be carried control” and to “cancel the planned privatiza- out? How can a country like Greece—facing tions and the looting of the public wealth, re- enormous challenges—be an ecological lead- store public control on—but at the same time

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reconstruct fully—strategically important en- of Greece, which has ample supplies of coal terprises that have been privatized or are un- in the form of lignite, the task is to move in a der privatization” and to build a public sector carefully planned and democratic way to a re- of a “new type.”5 newables-based system over a period of two to three decades. These commitments have set the stage for en- ergy democracy in Greece, and with it the need Not everyone on the Left, in Greece or inter- to chart a clear path, which can take Greece to- nationally, realizes that renewable energy wards a renewables-based energy economy technologies—particularly solar PV—have the that is under the direction and control of the potential to completely transform the global Greek people, one that is designed in a way energy system by 2030 and also change the that puts human, societal, and environmental political and class relations around energy needs before private profit. Such an approach production and consumption. But if left to the will begin to address seriously Greece’s depen- corporations and their political allies, such a dence on fossil fuels and its disproportionately transformation is not going to happen in the large contribution to air pollution and global time frame required by climate science as es- warming and to create more resilient commu- tablished by the Intergovernmental Panel on nities. Climate Change (IPCC). It has stated that an 85% reduction in greenhouse gases (GHGs) is necessary by 2050 (below year 2000 levels) Another Energy Is Possible to stay below 2-2.4 degrees Celsius of global warming.8 The approach to energy and climate suggest- ed here does two things: first, it steers clear of Consistent with the neoliberal model, renew- the neoliberal framework being driven by the able energy is deployed in ways that are ex- EU and, second, it pivots away from the cen- ploitative, chaotic, and wasteful and that sim- tralized power generation model that was built ply reinforce the class and other inequalities of around fossil fuels several decades ago. This the present system. The neoliberal approach approach can be called energy democracy. to energy transition and climate protection has been a monumental failure both in Greece and Energy Democracy is a public sector approach. internationally. It has reinforced the inequali- It can lead to a rapid development of renew- ties and injustices of capitalism and failed to able sources of power in Greece, primarily make significant progress in terms of the re- wind and solar (but perhaps also geothermal quired decarbonization of the energy system. and small hydro)6 while gradually and equitably phasing out fossil fuels for the production of Another energy system is not only possible, it electrical power. It allows space for generation is crucial to civilizational survival. And Greece that is community-owned and/or operated, can be on the cutting edge of the renewable decentralized, or “on site.” Energy democracy energy revolution and the fight against climate can demonstrate the true potential of renew- instability, a fight that is drivenby the public sec- able energy when it is liberated from the con- tor in partnership with communities, unions, straints of price competition and when “return and small companies. on investment” (profit) is no longer the prima- ry concern.7 Energy democracy is grounded A program of energy democracy does not, how- in energy sovereignty and self-determination ever, possess magical powers. The transition but it is transformative, not static. In the case from the ageing, centralized, and fossil-based

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power generation system that presently exists remain unanswered. Charting a pathway and to a new system that is mainly decentralized, developing a political process to oversee the low-carbon, equitable, and truly democratic transition leaves little space for naïve assump- will confront many obstacles and take two or tions and misconceptions. A rigorous and three decades to complete. Many questions facts-based approach is therefore essential.

Greece and the EU’s Neoliberal Energy Policy

Austerity and liberalization has set in motion energy sector, and to move steadily towards a powerful forces that could result in Greece democratic, renewables-based system that is completely losing control of its energy future. friendly to people and the climate. The proposed dismantling and sell-off of 30% of the assets of the Public Power Corporation (PPC), which controls 75% of Greece’s energy Fossil Fuel Dependence and Greece’s generation and almost all of its electricity gen- Changing Climate eration, is proceeding at considerable speed in accordance with the conditions laid down Two things will need to be addressed by a by the Troika.9 This includes the privatization SYRIZA-led government more or less simul- of the electricity grid. Upon completion of this taneously: Greece’s dependence on fossil fu- phase, the government proposes to sell 17% els, both domestic and imported, and the un- of what will remain of the PPC to private inter- developed state of the country’s capacity to ests by 2016. Of course, regaining energy sov- generate renewable sources of power. Greece ereignty—or national economic sovereignty in is a country that is highly dependent on fossil general—will be difficult because of Greece’s fuels and has a relatively weak (and privately relations with the EU. Meanwhile, energy costs owned) renewable energy industry. Presently are rising faster in Greece than in any other EU about 64% of the energy consumed is import- country (a 21% increase in 2012), a situation ed (considerably higher than the EU average of that is leading to growing fuel poverty and se- 46%). Greece imports gas from Algeria, Turkey, rious hardship. An increase in energy costs of and Russia, as well as oil and other petroleum over 60% has been recorded in Greece during products to serve its rapidly expanding fleet of the last six years of the financial crisis (2008- motor vehicles. Roughly 93% of Greece’s ener- 2013).10 gy consumption comes from fossil fuels while the corresponding average in the EU countries SYRIZA and its supporters, along with the is 75%. For electricity generation, 27% of power workers in the sector, have led the resistance generated comes from imported oil and gas. to the privatization of the PPC and are also ful- ly aware of the impact of fuel poverty on the Domestic lignite (or “brown coal”) produces lives of ordinary people.11 But a SYRIZA-led 70% of Greece’s electricity.12 Lignite is a partic- government could do more than merely pro- ularly dirty form of coal. A typical power sta- tect energy sovereignty. Consistent with SYRI- tion using lignite emits 37% more carbon diox- ZA’s program, such a government could begin ide per unit of power output than a power sta- the process of a planned restructuring of the tion using black coal. Lignite use is one of the

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main causes of Greece’s disproportionately cade, but it remains on the margins in terms large contribution to global warming. of electrical power generation (around 7%) and overall consumption. Greece is rich in wind and Greece emits more GHGs per capita than the solar “resources” but if the present policies are European Union average, 11.3 tons carbon di- allowed to continue, wind and solar energy oxide equivalent (CO2 Eq.) per capita, per year, will either be underutilized or utilized in a way compared to 10.1 tons for the EU15 average, that benefits mostly non-Greek private corpo- according to the European Environment Agen- rations. Consistent with SYRIZA’s program, the cy (2008 figures).13 In terms of carbon intensity, task is to turn these resources into abundant Greece (along with Malta) is the highest in the and clean energy for the benefit of all—under EU27.14 Greece’s use of lignite and its fast grow- public and community control. ing vehicle fleet are major contributors to both Greece’s emissions and carbon intensity. Fully

41% of Greece’s CO2 emissions come from the The EU’s Neoliberal Approach to generation of electrical power. Energy

The need for an energy transition of this nature The EU’s neoliberal approach to energy and cli- is reinforced by climate change. Projections for mate protection has been shaped by two poli- changes in temperature and precipitation over cy priorities. The first priority is energy market the next 50 years in the Greek territory show a liberalization—ostensibly to promote “choice” temperature increase of 3-4.5 degrees Celsius and “efficiency.” This priority was expressed in and a decrease in rainfall of 5-19%. According the Internal Market in Energy directive passed to the Greek government’s national submis- down to member states in 1996. The second sion to the UNFCCC in 2007: “climate” priority are the “20-20-20” targets un- der the 2009 EU Directive that mandate a 20% The long-term predictions of climatic models for reduction of GHG emissions, a 20% share of re- the Mediterranean region are alarming. All model newable energy sources, and a 20% savings in simulations agree that the temperature in Greece energy consumption by the year 2020 (based will increase in the range of 1 C to 2 C by the year 2030, despite the conflicting estimates of the on 2005 levels). Under this directive, member magnitude of this increase. Concerning the future states were required to develop a National Re- precipitation regime most of model estimations newable Energy Action Plan (NREAP) that would offer conflicting evidence over how precipitation include information on sectoral targets.17 The may change over the area. There are serious indi- targets are also designed to “pro­vide certainty” cations, however, for a remarkably severe decline in summer precipitation over the Mediterranean for private investors and to encourage continu- region as a whole.15 ous development of technologies that generate energy from all types of renewable sources. The economic impact of this level of warming on Greece will be serious. Rising temperatures In the eyes of neoliberal policymakers, the first will result in an increase in energy needs for two priorities—liberalization and climate pro- cooling, the reduction of tourism due to the tection—both complement each other and are increase of extremely high temperatures, re- inseparable from each other. The dominant duced biodiversity, and an increased risk of EU policy discourse (broadly consistent with forest fires.16 that of the World Bank and the IMF) asserts that liberalization and market competition Renewable energy—mostly wind and solar— are the pre-requisites for an energy transi- has made some headway during the past de- tion to a low-carbon future. Because the old

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fossil-based centralized systems were often tion and to 40% electricity generation from publicly owned, regulated, and monopolistic, renewable sources by 2020.20 According to the the public ownership and high levels of emis- NREAP for Greece, the installed wind energy sions are (conveniently) presented as part of capacity will reach 7.5 GW by 2020, which trans- the same problem. Reducing greenhouse gas lates into annual installations of approximately emissions and promoting renewable energy 600 MW between 2011 and 2020. This amounts is thus viewed to be synonymous with, and to a six-fold increase in wind generation and a therefore inseparable from, a “contestable” twenty-fold increase in solar by 2020.21 market for electricity and privatization.18 The energy market liberalization that began in the late 1990s led to an array of subsidies Electricity Privatization in Greece and incentives to help renewable energy com- panies gain a significant foothold in the EU The liberalization of Greece’s electricity sec- energy market. This combination of liberal- tor has thus far been a 16-year process. Lib- ization and subsidies saw the wind and solar eralization started with the enactment of Law industries make some headway over the past 2733/199919 when the process of privatizing decade across the EU. Member states’ wind Greece’s Public Power Corporation (PPC) was power’s share of installed power capacity had initiated. In accordance with Presidential De- increased five-fold since 2000 to 11.3% in 2012, cree 333/2000, the PPC became a public lim- although Germany (31.3 GW) and Spain (22.8 ited company in January 2001. The electricity GW) have the largest cumulative installed transmission system was “unbundled” under wind energy capacity in Europe, and these two the provisions of 2733/1999, which transferred countries represented 52% of the EU’s wind ca- the responsibility for operating the electricity pacity in 2012. Solar power has grown also, but transmission system to a new independent Germany’s progress is exceptional—and can company called the Hellenic Transmission Sys- be attributed largely to the process of remu- tem Operator (HTSO). The early 2001 liberaliza- nicipalization of power generation taking place tion of the Greek electricity market opened the there (see below). door to any company (or individual) to produce electricity. In 2007 individual consumers were Greece’s progress can be measured by a four- gradually granted full “rights” to choose their fold increase in wind capacity (1.8 GW in the energy supplier. These changes were followed decade to May 2013). The Greek Association by a law (3468/2006) giving renewable energy of Photovoltaic Energy Producers (SPEF) esti- companies special access to distribution and mates that 950 MW of solar PV capacity had transmission systems. New feed-in tariffs (FITs) been installed by 2012 under the country’s were defined and introduced in 2007 and per- Feed in Tariff (FIT) introduced in 2007, includ- mits for offshore wind parks became possible. ing 200 MW on the Greek islands.22 This was sustained in the first half of 2012, when Greece If these were the main measures designed to added 243MW. But governments across the advance liberalization, the EU’s 20-20-20 cli- EU were soon to withdraw their support for re- mate protection directive required Greece to in- newable energy, due in part to the falling pric- crease its share of renewable energy use from es in solar PV manufacturing and wind installa- 6.9% in 2005 to 18% by 2020. In June 2010 both tion costs, the marked shift in manufacturing the directive and the NREAP became national capacity towards China, and a sense that in law, raising the country’s renewable energy times of austerity and falling costs, generous commitments to 20% of final energy consump- FiTs were no longer necessary.

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In tandem with Spain, Italy, and others, the newable energy (mostly solar) by 2021, and Greek government announced a 44.7% cut has unveiled a number of “fast track” schemes in the FiT in June 2013, and the rush to solar to develop solar parks. Asserting that the in Greece ground to a halt. New wind instal- sun and wind resources in Greece are key to lations plummeted dramatically in Greece the nation’s economic recovery, the Samaras during 2013, and industry sources believe this government has unveiled high-profile plans will continue for at least another 1-2 years.23 like Project Helios that would see the country This policy reversal was triggered by the fact expanding its solar power capacity to 10 GW that the Renewable Energy Sources Fund by 2050 through financing by international in- (which pays renewable energy companies and vestors. The plan involves leasing out land to small producers via the FiT) had run up sub- investors to build solar installations as a way stantial debts—€331.5 million at the end of to generate revenue. This and similar projects 2012, which is expected to rise to €1.16 billion face only one problem, namely “liquidity,” and by the end of 2014, and up to €1.43 billion in it is hoped that the private sector will come to May 2015. 24 The PPC had committed to buying the rescue.29 renewable-source energy from independent producers at five times its selling rate until Such projects have indeed attracted the atten- 2034.25 Moreover, in November 2012 the Greek tion of EU companies and governments who government introduced a retroactive tax on may resort to importing renewable energy revenues earned by solar companies, which from Greece as a means of meeting their own has led to an industry complaint (led by SPEF) renewable energy targets and a likely new set to the European Commission (filed January of targets for 2030. This poses a possible win- 2013). 26 The government also stopped issuing win situation for companies (profits) and gov- building permits for PV power plants in 2013.27 ernments (reaching mandatory EU targets) but the benefit to Greece is at best questionable. The march to renewables across the EU has also slowed, albeit less dramatically than in Until the adjustment of the FiT, a proliferation Greece. Countries like the UK and the Neth- of small companies who import and install PV erlands are way behind schedule in terms of panels reinforced the “foreign” character of re- meeting their renewable energy targets under newable energy. These companies have been the 20-20-20 directive.28 In the case of wind, the known to advertise German products (taking NREAP forecasts for the 27 member states are advantage of their reputation for quality and not being reached. According to wind industry reliability) but then proceed to install low-cost sources, installed wind is trailing by 2 GW. Eigh- Chinese panels which require more mainte- teen of the 27 member states are behind on nance work (happily performed by the installer their wind energy trajectories—and Greece is for a fee). among a group of countries (along with Slova- kia, the Czech Republic, Hungary, France, and The withdrawal of the FiT in Greece has led to Portugal) that are far behind. the bankruptcy of many small and medium- sized companies—and these have become tar- gets of larger foreign multinationals who can, Green Colonization so to speak, weather the immediate storm and position themselves for the longer term. Non- As the Greek government has withdrawn FiT Greek renewable energy companies, mostly support, it has nevertheless continued to German (but also Spanish and Chinese) have state that it will invest up to €20 billion in re- opened offices in Greece in anticipation of €5

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billion in renewable energy investments in the Meanwhile, the main policy mechanism to re- coming years (according to an estimate made duce emissions and promote renewable en- by the Ministry of Development).30 ergy—the EU Emissions Trading Scheme (EU ETS)—is not doing its job. The EU ETS was sup- The sense of being colonized by multinationals posed to make fossil fuel use, especially for has been reinforced by Troika’s conditions and power generation, more expensive, but the the proposed privatization of the PPC and other price of carbon is today too low—often less public assets in order to meet debt repayment than €5 per ton even at its highest point—to obligations. The likely buyers for the most lu- have even a minimal impact. The price had crative parts of the PPC are foreign companies been expected to reach around €30 per ton by from Russia, China, and elsewhere. 2012. 32 According to one assessment, “power generation from coal even at currently high prices and a cost of €40 per ton of emissions, EU Policy at an Impasse remains cheaper by 15% from any other fuel for base units.”33 Today it is clear that the neoliberal approach to climate protection and the deployment of renewable energy is not working in Greece Resisting “Resource Nationalism” and is facing major challenges across the EU. The main message here is that it takes a large SYRIZA’s programmatic commitments to devel- amount of liberalization and, paradoxically, op renewable energy and to a new ecological subsidies and government intervention, to and economic paradigm will therefore require generate a relatively modest amount of renew- a new course. However, the combined effect of able energy. And in Germany, where renewable the failure of the EU ETS to price carbon in a energy has made real headway, it is unfolding way that can change energy investments and as a result of an explicit rejection of neoliberal technologies, along with availability of cheap energy policy and an expansion of municipal lignite, poses a major challenge to the ener- control and public investment (see below). gy transition in Greece. In the context of eco- nomic recession, rising prices of imported oil Far from being mutually reinforcing and insep- and gas, it may appear as though Greece has arable, the EU’s dual priorities of energy mar- no better option than to continue with lignite, ket liberalization and climate protection are, which is cheap, abundant, and still mostly pub- in fact, incompatible with each other. Liberal- licly owned. Greece still has a 51% stake in the ization has led to an oligarchic situation where PPC, but a 0% stake in German, Spanish, and just five energy companies are dominant (EDF, Chinese renewable energy companies. RWE, EOn, GDF Suez, and ENEL), consumer choice is mostly fictitious, and renewable ener- For SYRIZA, the Greek Left and social move- gy companies rely on power purchasing agree- ments, the pressures of lignite-based “re- ments, “capacity mechanisms,” and subsidies source nationalism” will be considerable. Note to survive. In the case of the UK (the flagship the similar phenomena in Argentina, Bolivia, of EU energy privatization), the government Brazil, South Africa, and Venezuela where left is attempting to re-introduce a “Single Buyer” and center-left governments are in power, but mechanism (read: government control over which all make the argument that domestic prices) because of the failure of the liberalized fossil fuels are needed to fight poverty and de- market to either benefit consumers or reach velop a strong economy, albeit to varying de- renewable energy targets.31 grees and with accompanying qualifiers. Senti-

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ments towards resource nationalism are likely grades and extensions that are required to to be reinforced by the fact that private-sector facilitate the deployment of renewables. As renewable energy companies in Greece to- militant neoliberals, renewable energy compa- day demand more liberalization, deregulation, nies can be cast in the role of a Fifth Column privatization, and subsidies to make further or Trojan horse, serving foreign interests in progress (for the good of the environment, the name of greening the economy. Such ar- of course). They lament the fact that the PPC guments and sentiments are understandable, has only been partially privatized and that the but they are ultimately grounded in a thinking union (GENOP-DEH) is too militant. The in- that is both simplistic and short term. Energy dustry calls for “cost reflective rates” for fos- democracy provides a framework in which sil based power (read: higher prices) in order SYRIZA can pursue and fulfill its programmatic for renewables to yield better profits. These commitments and chart a new course not just companies are also calling on the government for Greece, but for other countries in the re- to pay for the transmission infrastructure up- gion, and perhaps beyond.

Developing and Implementing Energy Democracy

Part One showed how EU policy offers nothing 2. Develop and implement a national energy in terms of a serious and equitable approach transition plan: The transition to a new re- to climate protection or renewable energy de- newables-based energy system will pres- ployment. Part Two attempts to take the dis- ent both challenges and opportunities. cussion forward in two distinct ways. First, it The Greek people must be in charge of offers some potential programmatic guidelines the process in order to ensure flexibility, or options for discussion and, second, it iden- diversity, resilience, and equity; tifies and begins to address some important 3. Promote energy independence: Fuel costs issues with respect to navigating the transition for renewable energy are zero. Climate to a renewables-based energy system. change and the rising social and environ- mental costs of the continued use of coal, oil, and gas make a transition to a renew- Short- and Long-Term Goals ables-based energy system an impera- tive. Greece has the potential to produce Regarding energy democracy proposals for enough renewable power to meet its needs Greece, four broad and overlapping political from within its own borders, and to do so goals can be identified. Greece must take ac- in a way that will generate jobs and savings. tions to: 4. Decentralize Energy Production: The pub- lic sector must drive the development 1. Re-establish control over energy (energy of renewable energy. Renewable ener- self-determination): The privatization of gy technologies (RETs) open the door to the PPC must be stopped and the neolib- community-based municipal control over eral approach to renewable energy de- electrical power generation and signal ployment soundly rejected. Greece needs the end of an over-reliance on centralized to follow its own path—based on energy generation. Greece’s next energy system democracy; can be a pillar of popular power.

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The first goal (re-establishing control) is a broader public are less pronounced and may short-term political challenge, an essential be erased altogether. Science-based emissions first step that provides the foundation for reductions targets are seldom if ever achieved. pursuing and reaching the other three goals. The second goal involves establishing a polit- Given the importance of lignite and the avail- ical process for driving an energy transition, a ability of solar resources (300 days of sunshine process grounded in and informed by democ- per year, on average), Greece has the poten- racy, transparency, and accountability. The tial to establish a considerable level of control third and fourth goals are the main planks of a fairly quickly. But total control is out of the multi-decade transition that can bring Greece question in the short to medium term. Oil de- to a point where 100% of its energy comes pendence is a particularly large challenge, and from renewable sources of power by 2040- one that can only be addressed over the longer 2050 and where its carbon emissions have term with vehicle electrification, fuel efficien- been reduced according to a science-based cy standards, “modal shifts” in transportation, pathway. Even though goals three and four are and an overall reduction of vehicle miles trav- necessarily long term, there is some value in elled (VMTs). Furthermore, any transition to SYRIZA endorsing these goals immediately as a renewable energy for electrical power genera- declaration of both principle and intent. tion must deal with the fact that today many of the products essential for wind and solar gen- eration are being manufactured in just a hand- 1. Re-Establish Control over Energy ful of countries, and Greece is not one of them. This issue is revisited below. Greece’s level of Re-establishing control over energy will re- control can thus be considerable in the short quire an intense political and legal struggle term, but it will not be complete for obvious that will begin almost immediately after SYR- reasons. IZA has formed a government. It is important to emphasize energy sovereignty and self-deter- SYRIZA’s actions regarding the PPC are crucial mination as key SYRIZA commitments: Greece to Greece’s capacity to control its own energy has the right to control its energy future and future and the transition to renewable energy. reduce its dependence on imported energy The PPC remains by far the largest company in and thus its vulnerability to the effects of deci- Greece. It owns 93% of the country’s installed sions made outside of Greece. Sovereignty and power capacity (generated by lignite, oil, hy- self-determination will help ensure that many droelectric, and natural gas power plants.) of the benefits of a renewables-based system The total installed capacity of PPC’s 98 pow- will be directed towards the Greek people, not er plants is estimated at 12,760 MW. The PPC private multinationals. also runs solar energy parks. At the same time, PPC owns the country’s two large lignite mines Re-establishing control is therefore an essen- in Ptolemais and Megalopolis, generating ap- tial first step. Without domestic governmen- proximately 56% of the required power supply. tal and popular control the other goals will Regarding the PPC, SYRIZA needs to take the be much harder and perhaps impossible to following actions: achieve. As the broader EU and global experi- ence has shown, when governments are forced ⇒⇒ Stop further privatization of the PPC’s as- to give guarantees to the private sector—or sets; to rely on incentives—then the transition is at ⇒⇒ Revisit and selectively repeal the liberaliza- best slow and uneven and the benefits to the tion measures and laws introduced over

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the last decade. The PPC needs to be fully inevitably be scrutinized and challenged by en- reclaimed by the Greek people. ergy companies and the political Right. ⇒⇒ Reform and restructure the PPC, along with the majority state-owned gas compa- The main aspects of the process for developing ny DEPA. Its role will need to be redefined a national energy transition plan will require in accordance with a national energy tran- careful thought and a broad and inclusive con- sition plan. sultation process, but a first step might involve identifying who should be at the table and what their role might be. Unions, small busi- 2. Develop and Implement a National nesses presently engaged in renewable power, Energy Transition Plan representatives of social movements, and pro- gressive research institutions might constitute The fight to keep the PPC under public own- the core of a commission of representative ership, and the struggle for energy self- groups convened to develop the plan. determination more generally, will require mass popular engagement. The privatization Engaging the union GENOP-DEH in the ener- of the PPC has not gone smoothly. Potential gy transition and the restructuring of the PPC buyers (large Russian, Czech, and Chinese is clearly important, as concerns about jobs companies are known to be interested in parts will be uppermost. However, the privatization of the PPC) do not want to take on pension pay- scenario that is presently unfolding is hardly ments of retired workers that amount to €710 a better option for workers in the industry. As million per year.34 Worker resistance has also has been documented in numerous studies, been quite determined. energy privatization has almost invariably led to underinvestment and falling quality of ser- A SYRIZA government could quickly begin a vice. It has also led to a loss of jobs, reductions broad-based and inclusive process for both in wages and union coverage, and worsening developing and implementing a national ener- working conditions. And where privatizations gy transition plan. Preliminary proposals for the have taken place, public control has normal- fossil-to-renewables transition can be offered ly been replaced by oligarchies. In the UK, six as a starting point for a national debate and private corporations—just one of them Brit- discussion around broad goals, fully aware ish—dominate the power generation sector, that the transition to a new renewables-based and 57% of fuel used to generate electricity is energy system will present many technical and imported.35 political challenges. The workers in the industry can be integrated A program for energy democracy must strive to into the new ownership and oversight struc- be as specific as possible in terms of the short- tures and can be given a large degree of re- and longer-term benefits of such a transition sponsibility for operating and maintaining the (cleaner air, improved public health, lower systems, something they do every day. Sec- costs for energy over time, less dependence tions of middle management can also be con- on fuels from abroad, climate stability and re- structively engaged. silience, significant job creation, etc.). It must also attempt to show how such a plan could The full legal implications (namely Greek law, strengthen community-based control and con- the EU, WTO, etc.) of moving to build energy structive autonomy. A facts-based approach is democracy by first restoring energy sovereign- always better than vague statements that will ty and self-determination will need to be con-

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sidered. It is well known that the entire legal wrestling with the pros and cons of various en- architecture pertaining to international trade ergy options, but SYRIZA can also make its own and investment that has emerged since the proposals and play a leadership role in terms early 1990s favors and protects the private of shaping the debate. These proposals might sector’s assets and profits. Therefore it seems include the following: inconceivable that a government committed to a new economic and ecological paradigm will Reduce Levels of Imported Gas and Oil for Power be able to avoid clashing with this architecture Generation sooner if not later. Greece must consider ways to decrease the A national transition plan will nevertheless amount of electrical power generated by im- need a legal framework to facilitate and consol- ported natural gas (and also oil) by expand- idate its development. A number of domestic ing the levels of electricity generated from laws (for example, Law 2773/1999) have been renewable sources of power. Greece present- passed in order to comply with the EU’s 1999 ly imports large volumes of gas from Russia, directive on developing a free and “contest- Turkey, and Algeria. Greece’s current contract able” energy market. As noted above, these with Russia’s Gazprom expires in 2016, and the laws will need to be repealed, and new laws Samaras government has already complained introduced that can democratize the energy that Greece pays the highest price for Russian system and help drive the transition.36 gas in Europe—at roughly 35 Euros per mega- watt hour (December 2013 prices).37 Similarly, laws have been passed to comply with the EU’s 2009 20-20-20 commitments. The In 2010, Greece consumed a total of an esti- liberalization laws and the 20-20-20 climate mated 3,809 million cubic meters (mcm) of protection laws have one thing in common: natural gas, 8% more than the previous year. they assume a larger role for private compa- In 2009, Germany (several times bigger than nies and a smaller role for the public sector. Greece in both GDP and population size) con- But these two sets of laws can be handled dif- sumed a smaller amount, 3,528 mcm. In 2009, ferently. There is no obvious reason why SYR- Greece used 2,181 mcm for electricity gener- IZA will need to renege on existing 20-20-20 ation, covering 15% of electricity generation.38 commitments, but the NREAP will need to be Gas makes up roughly 9% to Greece’s total en- amended in order to provide a different road ergy use.39 Reducing gas imports would allow to these targets. Greece to take important steps towards ener- gy sovereignty and self-determination.

3. Promote Energy Independence An energy transition plan must therefore ex- amine the role of the mostly state-run gas As is well known, Greece is today dependent company, DEPA, and the projects it is presently on fossil fuels both domestic (lignite or brown developing (usually with foreign multination- coal) and foreign (oil and gas). Its renewables als). The Greek government has a 65% share of sector is small and presently privately owned. the company, with the remainder controlled by To embark on a road towards ecological and the Hellenic Petroleum Group. In recent years, economic sustainability, fossil fuel use must be DEPA has committed large sums of money to reduced and eventually phased out altogether. upgrade its Liquid Natural Gas import facil- The development of a national energy transi- ities. DEPA has also partnered with Russia’s tion plan will involve different stakeholders Gazprom and the Italian ENI around the “South

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Stream” project that is expected to transport er the deployment of renewables, the faster gas from Russia to Italy via Greece.40 Greece’s bill for imported gas will be reduced.

From the perspective of reducing GHG emis- However, gas-fired power stations will be im- sions, it would of course be better to first sub- pacted, and the new renewable energy coming stitute renewables for domestic lignite and into the system must therefore be situated in then reduce natural gas use later on. This is locations that can compensate for this loss of due to the fact that “burner tip” emissions from generation. This could pose a series of second- gas are much less than those generated from ary challenges—and this may require modifica- lignite or black coal. tions and deviations from time to time, without compromising the overall goal of substituting The EU’s troubled Emissions Trading System gas-fired generation with renewable energy. has been deployed as an incentive to switch from coal-fired generation to gas, but this fuel Greece also uses imported oil—diesel and switching in Greece may not be the best option crude—for around 5% of the country’s elec- politically or economically in the short term. tricity generation. However, oil-based gener- Importantly, gas-fired power generation is the ation has thus far served island communities domain of a handful private Independent Pow- or thermal power stations near Athens as a er Producers (IPPs) that have become present means of avoiding lignite-related air pollution. in Greece during the liberalization period. The Therefore any reduction in oil-based electricity IPPs presently advocate for more privatization generation will need to address these specific and liberalization.41 Reducing gas imports will challenges.45 therefore increase the portion of Greece’s en- ergy that is under public control. And a fully The renewables-for-gas (and oil) option needs “reclaimed” PPC will ensure that the benefits to be fully explored, and there are many fac- of domestic lignite use are at least retained in tors to consider. But when energy is generated Greece, rather than distributed as a source of for public need and not simply private profit, profits for what is likely to be a Chinese, Czech, then social and environmental considerations or Russian corporation. 42 can be fully examined and decisions made that best serve the people and the planet. As noted above, domestic lignite produces 70% of Greece’s electricity (2008 figures).43 Further- Cap Levels of Lignite Use for Power Generation more, Greece has plentiful supplies of domes- tic lignite and the infrastructure in place to con- Lignite is important to Greece. And although tinue using it for the foreseeable future. There- the unimpeded use of lignite for power gen- fore during the first phase of Greece’s energy eration may be consistent with energy sover- transition (perhaps a decade or so) the strate- eignty and self-determination, it is certainly gy should, as far as possible, entail a straight not consistent with any serious commitment swap: domestic renewable energy should to a new economic and ecological paradigm. replace imported natural gas (and oil, which The ecological effects of lignite use are deeply generated 5% of Greece’s electricity). If renew- negative. Lignite is a particularly dirty form of able energy generation can increase at a level coal. A typical power station using lignite emits of several GWs per year (Germany installed 7.6 37% more carbon dioxide per unit of power GW of new solar capacity in 2012 alone44) then output than a power station using black coal. the annual reductions in gas-based generation Lignite use has made a major contribution to should be more or less comparable. The fast- Greece’s disproportionately large contribu-

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tion to global warming and negatively impacts coal-fired unit to be installed in Aliveri, and a public health. 700-800MW hard-coal-fired unit to be installed in Larymna.47 During the first phase of the energy transition it is therefore important to announce a cap on Establish a Timeframe to Phase-out Lignite Use lignite use in order to protect against the temp- tation to replace imported gas with more lig- Lignite reserves in Greece are plentiful and nite production and lignite-fired generation. A could last many decades, but the existing lig- supplementary cap on GHGs from lignite could nite-powered generation facilities presently also serve a purpose, and retiring the oldest operational in Greece will not last forever and lignite-fueled power plants and introducing an effective moratorium on new construction pollution control technologies where appropri- will mean that the fleet of lignite-fired facilities ate could complement such a policy. will eventually become dilapidated and will have to be decommissioned. The trajectories Declare a Moratorium on New Lignite-Fired Power for the phase-out of lignite use will, however, Plants depend on how fast renewable energy can be scaled up in Greece, and how technical and fi- Greece must also take care to avoid “carbon nancial challenges are met and obstacles ne- lock in,” where new lignite-powered generation gotiated. is built in order “to meet demand.” The Inter- national Energy Agency has issued dire warn- Given the significant number of workers en- ings regarding the dangers of building the in- gaged in lignite mining, transportation, and frastructure for more coal-fired and gas-fired power generation, workers and communities generation. Globally, there are approximately that depend on lignite need to be reassured 280 GW of new coal-fired generation under that the transition away from lignite is not tak- construction at the present time.46 Greece is ing place without their active involvement and not currently in a position to do much about that it will not happen soon. Firing workers is this alarming level of coal-driven carbon lock not on the agenda, under any circumstances. in, but it can officially declare its intention to No worker or community will be asked to pay separate itself from the global coal rush and a disproportionate price for the energy tran- thus signal a strong commitment to a new eco- sition while others in Greece (and globally in nomic and environmental paradigm. This can the form of reduced emissions) reap the ben- be accomplished by announcing a moratorium efits. A set of robust protections and guaran- on the construction of any new lignite-fired tees need to be given priority in order to avoid power plants. alienating the workers and communities likely to be affected by a shift away from lignite— Clearly, this will require a careful assessment however far in the future that shift may actu- of the environmental, social, and economic ally be. implications of projects presently approved or under construction. These include five ma- jor PPC-led developments, among them a 800 4. Decentralize Energy Production MW natural-gas fired unit to be installed in Megalopolis, a 450 MW lignite-fire unit to be The proposals outlined above amount to a installed in Meliti, a 450 MW lignite-fired unit steady phasing out of fossil fuels between using fluidized bed technology to be installed now and 2040 to 2050, first by prioritizing re- in Kozani-Ptolemaida, a 700-800 MW hard- ductions in imported gas and then (over time)

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domestic lignite. This will require the rapid de- try is expected to install another 100 GW, near- ployment of renewable sources of power, prin- ly doubling today’s global capacity. These im- cipally solar and wind, to replace lost capacity. pressive levels of deployment are nevertheless Energy conservation can also play a role—and inadequate from the perspective of climate needs to be given serious attention both for its stabilization. According to the IPCC, in order to capacity to create jobs, reduce costs, and avoid reach the required levels of emissions reduc- the development of unnecessary generation tions in power generation, the deployment of capacity in the future. renewable energy needs to proceed at a much faster pace.48 The remainder of this paper will focus on offer- ing for discussion some options and strategies Feed-in Tariffs / “Prosumer” Approaches for developing renewable power in Greece in the “public sphere.” The public sphere includes Among regulatory policy instruments, feed-in “prosumers,” cooperatives, municipal-level tariffs (FiTs) are the most popular type of pol- entities, as well as a reformed and perhaps re- icy, though particularly so in high-income and structured PPC. upper-middle income countries.49 FiTs provide incentives for property owners and small and The international experience of developing large businesses to invest in solar PV. These renewable energy shows the limits of private consumers use the power of installed PV sys- markets and the importance of government tems for their own use, but the surplus power actions and interventions, but it is nonetheless generated is then purchased by the utility at a important to know why the dominant policy favorable and stable rate, thus generating in- choices are incompatible with either energy come for those who participate in the FiT pro- democracy or SYRIZA’s commitments. grams. The idea of individuals and businesses playing a dual role—as energy consumers, but also producers—has led to the emergence of The International Experience the term “prosumers.”

What can be learned from the efforts of other FiTs produced 61% of all solar PV capacity in- countries to develop renewable energy? Coun- stalled in 2012 and accounted for nearly 72% tries that have made the most significant gains of all solar PV installed worldwide.50 Under a have established a robust set of regulations FiT policy, eligible renewable electricity gen- to incentivize renewable energy. Two policy erators are guaranteed a standard purchas- options stand out: the Feed in Tariff (FiT) and ing price for the electricity they produce, and the Renewable Energy (or Portfolio) Standard electric utilities are required to purchase all (RES/RPS). The international experience sug- available electricity from renewable energy gests that these policies can drive renewables, sources. FiTs have been adopted in a total of but there are problems with respect to the 99 jurisdictions worldwide as of early 2013.51 speed and scale of the deployment—and the fact that the benefits of renewable energy are As noted in Part One, in Greece and elsewhere not shared equally by all. government support for FiT programs has been scaled back significantly in the last year Nevertheless, renewable energy is growing or two. This has slowed the growth of both rapidly on a global scale. Fully two-thirds of wind and solar power. In Greece, solar PV in- current global solar PV capacity have been in- stallations essentially stopped in late 2013 af- stalled since January 2011. By 2015, the indus- ter several years of impressive growth.52 As of

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this writing, the future of FiTs is in question— or P3s, and thus more IPPs and Power Pur- but falling costs in solar PV in particular means chase Agreements (PPAs) that protect private that solar could grow quickly without the sup- companies from risk (unloading the risk on to port of FiTs. the public) and a bias towards large-scale re- newable energy projects. It will also leave the Renewable Portfolio/Energy Standards major decisions on how to grow renewable energy to the PPC. Indeed, news sources (De- A national Renewable Portfolio Standard (RPS), cember 2013) have speculated that the Greek sometimes referred to as a Renewable Energy Ministry of Environment, Energy, and Climate Standard (or RES), is another policy option. An Change (MEECC) will propose a “new deal” be- RPS/RES obliges power companies to produce tween renewables producers and the state to a specified fraction of their output from re- further cut project FiTs in exchange for bene- newable energy sources by a given target year. fits such as longer PPAs.54 Such a policy would Such policies have been introduced, either at halt the growth of Greek “prosumers” while the national or the state/provincial level, in delivering guaranteed profits to private energy 76 jurisdictions, though most prominently in companies. high-income countries. RPS/RES policies are more prominent on the sub-national level, and Regarding the FiT, the problems are more com- their numbers were boosted in 2004, when a plex. FiTs are considered to be a good mecha- significant number of U.S. states and Indian nism for getting solar PV off the ground, and provinces adopted such standards and quotas. for engaging ordinary people—homeowners The years since 2008, however, have seen only and small businesspeople—in the transition to limited additional momentum.53 renewable energy. FiTs have also “seeded” the market and allowed small companies and their Problems with FiTs and RPS/RES suppliers to develop. This can broaden the base of support for renewable energy among It is important to be fully aware of the prob- a certain layer of people who benefit from the lems inherent in these two presently most uti- tariffs directly and also indirectly (such as in- lized policy options, FiTs and RPS/RES, so that stallers and the companies making basic com- Greece can try to avoid these problems either ponents used in installations). by changing the design of these policies or by avoiding them altogether. However, FiTs remain problematic in a number of respects. FiTs are known to benefit proper- Regarding an RPS/RES for Greece, if this were ty owners and small to medium businesses, adopted in the same way as it has in other but most people—the propertyless and low- countries, it would require the PPC to generate income people—fall outside these categories a growing share of its electricity from renew- and therefore neither see nor receive any im- able sources, such as 20% renewable energy mediate or obvious economic gain. This prob- by 2020, or some similar target. This option lem has been partially addressed in Germany could sustain the PPC as the main actor in and a number of other countries where there Greece’s electricity system, but perhaps to the have been efforts to build energy cooperatives exclusion of others—including unions, com- that can pool both the capital and commit- munities, and local decision makers. Absent ment of a group of individuals to develop solar strict conditions regarding the actual sourcing PV generation in public or other spaces so that of renewable power, an RPS/RES will probably people without either property or substan- open the door to public-private partnerships, tial amounts of personal capital to invest can

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come together and produce power and thus a cooperative manner, seems unavoidable and take advantage of existing FiTs or other incen- in many respects preferable. tives (see below). But this does not address the cost of the subsidies—which are often consid- In Greece, the solar PV that emerged as a re- erable—that are in effect passed on to those sult of the FiT has also led to a number of ad- without property or businesses in the form of ditional problems that will need to be tackled higher electricity prices. by a SYRIZA government. One problem stems from the 25-year contracts with prosumers In many countries the utilities have used the that were agreed before the FiT was scaled “cost of subsidies” argument as a way of push- back. These contracts have provided an annu- ing back against the off-site distribution stimu- al untaxed income of €7,200 per year for a 10 lated by FiTs. Many are trying to quarantine the kW/h development at the February 2012 price, impact of FiTs, because the more FiT-led de- decreasing to €6,840 with the August 2012 ployment, the smaller the utilities’ traditional price. These levels of income exceed the aver- customer base becomes. This means the costs age agricultural wage, which prompted many of investment and operation and maintenance landowners to “grow PV” instead of tradition- of the centralized system are shouldered by al crops, the markets for which has atrophied a decreasing number of paying customers as dramatically in recent years. The contracts revenues fall. Even if profit for investors is tak- also amount to a kind of “solar lock in” where- en out of the equation, a system based on en- by land must be dedicated to solar power gen- ergy democracy will need to be grounded in a eration, taking agricultural land out of circula- stable financial model, which means finding a tion—which could have serious implications way to cover investments in the system, opera- for SYRIZA’s commitment to revitalize local tion and maintenance costs, and perhaps gen- agriculture. The FiT also created much need- erating surplus revenue for upgrades and new ed employment for local people who have investments. The typical prosumer arrange- trained as mechanics and electricians in what ment, where individuals, small businesses, is an almost completely unregulated segment and even cooperatives become partially inde- of the labor market.56 pendent of the grid means the costs to main- tain and renew the system are shifted to those The shift in the use of agricultural land, the who are not prosumers—with potentially se- gain—and then loss—of jobs that are depen- rious consequences. Furthermore, the rapid dent on global supply chains (solar PV from deployment of renewable energy raises the Germany, China, etc.), and the debts accrued problem of intermittency (the wind does not by the Renewable Energy Sources Fund— always blow, nor does the sun always shine), which may soon exceed €1 billion—are the leg- which will require the development of new acy of the neoliberal approach to renewable “smart” grid options and technologies that can energy in Greece. But it is a legacy that SYRIZA integrate and coordinate many different feed- will nevertheless inherit when it is elected to in points. The problems posed by rapid devel- government. opment of renewables without the necessary upgrading of the grid have already become ev- Policy Considerations ident in Greece.55 The development of a national energy transi- This issue is too complex to be discussed in de- tion plan will require a full examination of the tail here, but the need for a public entity, or a impact of FiT in Greece and elsewhere in order number of public entities working together in to see if it still has a role to play in what should

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be a more ambitious scale-up of renewable that is sufficiently ambitious in order to meet generation. Could a policy be designed that emissions reduction targets and is equitable provides some income for prosumers but is in terms of the benefits generated by renew- nevertheless sustainable in terms of its costs able power. The PPC already has a presence in and impacts on other sections of the econ- renewable energy and therefore some experi- omy? Can a more regulated labor market in ence to offer, particularly with regard to larger renewables—the creation of a “climate jobs” installations. A reformed and reoriented PPC corps hired by the PPC—still allow for people could play the role of buyer and installer or who need work to have access to installation PV and do so in a way that creates stable work and maintenance jobs, particularly in solar PV? based on local hire systems. However, if the benefits of the FiTs are ulti- mately destined to accrue to relatively few and the costs continue to be incurred by many then Energy Cooperatives this is obviously a major concern that casts doubt over the wisdom of using FiTs as a pri- For many on the Left, cooperatives imply pop- mary policy option in the years ahead. ular power and local and sometimes worker control. Food cooperatives, for example, are As noted above, the scaling back of the FiT in hugely important globally and are a major Greece has meant that solar PV installations counterforce to the large capitalist food con- have ground to a complete halt in late 2013.57 glomerates. However, many renewable energy But the falling price of solar PV—driven by over- cooperatives are distinct in the sense that, at capacity, learning-by-doing, economies of scale least in the Global North, they tend to resemble and reducing installation costs—means that a traditional investment rather than a process solar PV probably does not need an FiT in order involving ongoing management and social in- to grow, although the same may not be true of teraction. For example, once installed, a solar wind power at this point in time. It is certainly PV project requires little by way of maintenance possible that private markets could drive an ex- and will produce power for up to thirty years. A ponential increase in solar PV both in Greece wind turbine requires more attention in terms and globally, but this could lead to a renew- of maintenance, but not on a day-to-day level. ables-based economy that merely reproduces the inequalities of the old fossil-based system, The act of purchasing and even installing re- albeit in a different form. And even an acceler- newable energy capacity may therefore be ation in the levels of deployment are unlikely cooperative in the sense that a distinct com- to decarbonize power generation in the time munity may come together and decide to pool frame demanded by climate science. Last but resources, but the “cooperation” part of the not least, a neoliberal approach will mean that cooperative mostly ends once the project is non-Greek producers will benefit and small operational. Furthermore, as noted by the Folk installation businesses in Greece will operate Center in Denmark “profit is not reinvested to outside any popular oversight or regulation. increase the supply of renewable energy for the common good but instead to private con- The international experiences of the RPS/ sumption.”58 RES and FiTs actually reinforce the conclusion that, in the case of Greece, there is a need for Renewable energy cooperatives have been government, the PPC, municipalities, unions, viewed favorably in some circles because they and communities to work together to drive have been seen to undermine large fossil-com- the transition to renewable energy in a way fortable utilities committed to the tradition-

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al business model of selling as many kilowatt shaped the PPC. However, a reformed and de- hours as possible, and they therefore shift eco- marketized PPC can (in principle) be a driver of nomic and political power downward and out- renewable energy deployment in Greece. ward. In the many instances where public utili- ties have become marketized and profit-driven The international experience is again informa- in accordance with the neoliberal agenda, the tive. As noted above, in many countries and growth of cooperatives can be seen as a pos- regions the centralized utilities have resisted itive development. Moreover, Germany’s 700 policies that incentivize on-site generation be- renewable energy cooperatives have provided cause it threatens their customer base, reduc- a launch pad for remuncipalization of power ing revenues and profits.60 When forced to use generation in more than 40 cities.59 renewables as a result of an RPS/RES, utilities have often partnered with private for-prof- Cooperatives (along with the wider “prosumer” it IPPs in order to meet the required targets. community) have also helped solidify popular In rare instances, utilities have actually pio- support for Germany’s relatively impressive neered on-site generation, often as a preemp- shift toward renewable power. Cooperatives tive measure, moving into and enclosing an therefore have a consciousness-raising role. emerging and otherwise disruptive market.61 Finally, cooperatives have made a contribution Such occasional shifts have been based on the in decarbonizing electrical power, which is also understanding that the long-term economics a positive outcome. of renewable power are favorable and could spell the end of centralized generation’s pre- In terms of a SYRIZA policy based on energy ponderant role.62 democracy, it is perhaps prudent to avoid any definitive statement on energy cooperatives These examples show that utilities can change until more research has been done and discus- their role. In the same way as the utilities sion has taken place among representatives of moved from essentially serving the needs of social movements, unions, and municipalities. the public, the nation, and industry to a period Falling prices mean that solar PV is likely to of neoliberal-type profit maximization, utilities become attractive for homeowners and small can be instructed to play a role in helping, rath- businesses even without subsidies, FiTs, or er than hindering, the deployment of renew- some other form of incentive. Similarly, com- able energy and aggressive end-use energy munity-based projects (“collective prosumer- conservation. ism”) will also become more viable in the years ahead largely for the same reasons. Therefore cooperatives can potentially play a significant Centralized or Decentralized Renew- and perhaps important role in Greece’s transi- ables? tion to renewable energy. A national energy transition plan will provide the political vehicle to transcend the present in- A Reformed and Restructured PPC terest-driven debate about centralized versus decentralized generation, where utilities and Perhaps the most effective and equitable way prosumers are seemingly locked into an antag- of expanding Greece’s renewable energy ca- onistic relationship. Those engaged in the plan pacity will require a radical change in the role may come to realize that the speed and scale of of the PPC. Like many public entities, the forc- the required deployment of renewable energy es of liberalization and marketization have re- may require utility-sized renewable energy (10

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MW or larger) to grow alongside small on-site Instead of overpaying for projects, such as the generation. Presently, utility-sized projects are 40MW offshore wind farm near Anholt, the same dominating the deployment of solar PV global- volume of wind energy might be supplied at below half the cost by onshore wind turbines that are ly. By early 2013, about 90 plants in operation democratically owned and run by local not-for- had capacities in excess of 30 MW, and some profit companies.66 400 had a capacity of at least ten MW. The world’s 50 biggest PV generating plants have a cumulative capacity of more than four GW, or Municipalization in Germany more than 80 MW on average.63 However, this may say more about the bias of the utilities for As part of the effort to build energy democ- large-scale projects, and the strength of the racy in Greece, municipal-based power could large IPPs in shaping energy policy—such as be situated at the center of a new energy sys- P3s—than it does about the inherent advan- tem, with a reformed PPC playing a coordinat- tages of big projects over on-site decentralized ing and technical role. In the 1980s and 1990s, generation.64 German municipalities ceded control of pow- er generation, but in recent years many have A similar tension is evident in the discussion decided to reclaim their local grids.67 Germany around wind power generation and the dif- has thus seen a major expansion of direct mu- ferences between onshore and offshore wind nicipal provision of energy services. production. Offshore wind power is more ex- pensive than onshore per unit of energy gen- A recent report by Public Services Internation- erated, but it has been proposed as a means al Research Unit (PSIRU) notes how, between of overcoming public resistance to the pres- 2007 and mid-2012, over 60 new local public ence of wind turbines. However, several public utilities (Stadtwerke) have been set up and more opinion polls suggest that public ownership of than 190 concessions for energy distribution wind power is the most effective way of han- networks—the great majority being electric- dling public resistance. Because the benefits ity distribution networks—have returned to are shared by all, the public is more willing to public hands. According to PSIRU, “about two accept the presence of wind turbines. A 2012 thirds of all German communes are consider- poll in the UK is among several to suggest this. ing buying back both electricity generators and According to The Guardian, the distribution networks, including private shareholdings in some of the 850 Stadtwerke. 49% of people would support a wind turbine being The new and re-municipalized Stadtwerke are erected within two miles of their home, with 22% able to operate as supply companies, either against. But if the project were community-owned, support rose to 68% and opposition plummeted to buying or generating the mix of electricity they 7%. In Germany, where 65% of its huge renewable want.”68 The city of Munich, for example, has energy capacity is community-owned, opposition simply decided that all its energy will come is much rarer than in UK where community owner- from renewables by 2025, and all of it will be ship is less than 10%.65 generated by the public sector—because the private sector cannot be relied on. This was When the benefits line the pockets of a few, powerfully articulated in 2011 by Dieter Reiter, resistance grows. In the case of Denmark the a Munich city councilor, when addressing an in- privatization of wind has seen resistance levels ternational conference of economists: rise, which has had the effect of pushing less visible, but much more expensive, offshore Energy supply was one of the key sectors affected wind. Preben Maegaard writes: by privatization of formerly public enterprises. To-

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day, energy supply is characterized by oligopolies pacities (80 GW) also exceed market demand of private energy suppliers. There is practically (44.7 GW installed during 2012) by a substan- no competition on price. The transition to renew- tial margin, which has led to job losses in tur- able energies is made rather reluctantly and only 74 as a consequence of massive state subsidies and bine manufacturing. This consolidation puts regulatory requirements. The example of Munich a limit on the renewable energy manufacturing shows how the transition process can be sped up if employment that any country may expect. a city owns a utility company. By 2025, our utility company aims to produce so much green energy, Jobs can, however, be created in the produc- that the entire demand of the city can be met. That tion of basic components and in the construc- requires enormous investments—around 9 billion euros by 2025—and can only be successful if the tion, installation, and maintenance of renew- long-term goal is sustainable economic success able energy projects. The production of solar rather than short-term profit maximization. 69 modules amounts to about 25% of the cost of solar, and labor costs are a small portion of Those who refer to Germany’s successes in that share (perhaps 10%). Invertors add a fur- advancing renewable energy often appear un- ther 10% of the cost of solar. But solar PV also aware of, or perhaps reluctant to acknowledge, needs mounting structures such as extruded the role of public authorities in challenging aluminum rails (the modules are connected by privatization and intervening on behalf of the these rails) that can be produced by existing broader public. metal fabricators in Greece. “Follow-the-sun” single-axis and double-axis tracking systems are also needed.75 Large-scale deployment will Job Creation in Renewables stimulate demand for cables, connectors, and other electrical components. Array planners An ambitious deployment of renewable ener- are needed as well. gy can create significant numbers of jobs in Greece.70 Global wind power-related employ- It is conceivable that module or invertor man- ment has expanded more than eleven-fold in ufacturers could set up operations in Greece— the past 15 years, while solar PV employment but in each instance this would probably entail has soared close to 290-fold during the same a five-year commitment at a minimum of 200 time period.71 The jobs in Greece will be creat- MW of capacity per year. Clearly, the scale and ed in the renewable energy sector itself, and speed of the planned deployment will have eventual reductions in the cost of electricity an impact on the prospects of manufacturing will redirect spending to other goods and ser- gaining a foothold in Greece and also its chanc- vices—thus creating additional jobs across the es of future expansion. Publicly-owned man- economy. ufacturing facilities or cooperatives are not inconceivable but may involve “joint venture” The prospects of manufacturing PV panels or arrangements in order to allow for the transfer wind turbines in Greece are, however, pres- of skills and knowledge. ently not that good. The collapse in solar PV panel prices is forcing a consolidation of the As noted above, the FiT experience in Greece industry, with the loss of tens of thousands of has shown that jobs in the installation of solar manufacturing jobs in Europe, North America, PV systems are significant. A Böll Foundation and China.72 Consolidation is also taking place study of the solar industry in Germany claims in the solar inverter industry, with production that as manufacturing has shifted to China, the shifting away from Europe toward China and cost of solar has decreased, leading to higher the United States.73 Wind power production ca- installation rates, presently at 7.5 GW of new

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capacity per year on average. This has, in turn, sector involvement is not “free” for govern- created employment in installation, compo- ments and the public sector: the examples of nents, and project development.76 Vietnam and Indonesia show how World Bank loans worth billions of dollars are used simply It is possible to imagine the installation and to enable the existence of private companies related work being performed by PPC em- in a market and how private involvement only ployees earning decent wages. The PPC could responds to long-term power purchase agree- also be the primary purchaser of solar mod- ments, a system which is notoriously vulnera- ules, inverters, and other components. Public ble to corruption and over-charging.80 buildings such as schools and hospitals could be assessed in order to see if they are suited The transition to renewable energy in Greece for solar PV, and a plan developed to install PV will require commitments of capital. Howev- systems over the course of the next decade er, so will fossil-based business as usual in the or two. In Greece, the largest single classifica- form of imported oil and gas along with the tion for buildings are public schools. Already considerable health-care costs that are caused the Centre for Renewable Energy Sources by air pollution. Greece’s air pollution is higher (CRES) has explored possibilities of photovol- than the OECD average, and the air pollution taic systems development on the rooftops of levels in Athens are today 15 times higher than schools, in partnership with Greece’s School the EU’s alert level as a result of unaffordable Buildings Organization (SBO).77 A 2011 study heating fuel leading to more wood burning.81 on the bioclimatic design of new schools in And the costs of climate instability in the years Greece concluded, “not only do passive solar ahead are seldom if ever considered as part of schools contribute to energy consumption re- the costs of burning fossil fuels. Furthermore, duction, but they also contribute to the conser- as coal-fired power stations do not last forever, vation of natural resources and the reduction they will either need to be replaced with new of greenhouse gases emissions [sic] to the at- ones or the investment needs to be redirected mosphere.”78 A national energy transition plan to renewable sources of power. could involve developing an inventory of public buildings and spaces in order to assess their The public sector’s annual electricity bill is also capacity for on-site power generation. a cost that can be calculated over 20 years based on recent trends. This cost can then be compared to the cost of major solar PV deploy- How to Finance the Transition? ment in those facilities. The price of globally sourced PV, along with installation and main- The political Right around the world has per- tenance costs, are today such that PV systems petrated the idea that renewable energy and can pay for themselves within five years there- climate protection measures are luxuries the after the electricity supply to these facilities economy cannot afford, especially with the im- will be virtually free. There is every likelihood pact of a deep recession still being felt across that the electricity costs to sustain the public the global economy. Alternatively, if renewable sector—including schools, hospitals, and other energy is going to happen, it is argued that only government buildings—will actually fall quite the private sector can do the job—thus the dramatically over a 20-year period. emphasis on “public private partnerships” or P3s, power purchase agreements (PPAs), and Once taken back into public ownership, other guarantees that have repeatedly led to Greece’s banks can lend capital to municipal overcharging and corruption.79 Clearly, private and other public authorities at socially fair and

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reasonable rates of return. And even if these sued domestically rather than internationally authorities need to borrow from commercial and provide a tried and trusted mechanism banks, the cost of capital is cheaper for these for financing public services. One additional authorities than it is for private businesses. As source of revenue for renewable energy in- PSIRU notes: stallations is the profits from user payments. Another option is for the PPC to issue bonds The cost of capital is cheaper for the public sec- against its future revenues. These can be is- tor… The myth of ‘leveraging’ private investment sued domestically rather than international- has already been exposed in the water sector as ly and bonds of this type provide a tried and an empty promise, and should not be re-used to distort the development of renewable energy. trusted mechanism for financing public ser- vices. The public sector provides not only a means of financing investment in renewables, but also a Another possibility is a carbon tax. There are collective resource of knowledge embodied in numerous options for designing a carbon tax, workers who are securely employed, paid a decent such as imposing it on major industrial emit- wage, and working in conditions that prioritise safety for both workers and the public. It also has ters in Greece, or through a charge on petrol. the flexibility to develop renewables on a large Greece consumed an average of 343,000 bar- scale, or support small-scale, decentralised, off- rels of crude oil per day in 2011, of which al- grid local operations.82 most half (46%) was used for transportation.83 According to the IEA (2009 data), compared Capital could also be sourced by other means. with other OECD Europe countries, Greece In 2012 the PPC made a pre-tax profit of €276 has a relatively low tax on gasoline and diesel. million. A “reclaimed” PPC would provide the A small carbon tax of a few cents on a liter of option of redirecting capital to renewables. petrol would generate significant revenue that Another option is for the PPC to issue bonds could, in turn, be dedicated to investments in against its future revenues. These can be is- renewable energy.

Conclusion

Energy democracy is entirely consistent with gy future of Greece in a time of climate change SYRIZA’s existing programmatic commitment and what today appears to be “austerity with- to work toward “the development of a new par- out end.” There remain many unanswered adigm of social, environmental and economic questions and many formidable challenges. development,” and the need to build a public The international Left has a responsibility to sector of a “new type.”84 help in any way it can, with technical expertise and other skills that may initially be in short This commitment has set the stage for both supply during the period of energy transition. energy democracy and a deep restructuring of Greece’s economy. The options presented A successfully developed and implemented here are not offered as a manifesto or tightly program of energy democracy in Greece could integrated program; instead, they are intended be important to the Left in other parts of East- to be a contribution to the debate on the ener- ern Europe in particular, where many battles

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against fossil fuels companies and extractivist is truly staggering in terms of its planetary im- policies are presently being waged. In Southern plications.85 The emission reductions scenar- Europe and North Africa, renewable energy has ios presented by the IPCC86—a needed 85% enormous potential as well, but—as is the case reduction by 2050 based on year 2000 levels elsewhere—the social and economic potential to remain between 2 and 2.4 degrees Celsius will only be realized if these resources are de- of global warming—are today as far removed veloped in a democratic way and stay within from political reality than at any point since the the public sector. Cooperatives and small pro- UN climate talks began over 20 years ago. ducers can and should play a role, but the mul- tinational companies’ domination of the energy SYRIZA’s commitment to a planned transition and climate protection agenda must end. to renewable energy and its intention to pursue a new paradigm of social, environmental, and As of this writing, the UN climate negotiations economic development therefore has plane- are corporate-dominated and going nowhere. tary significance. If Greece can demonstrate The EU’s neoliberal energy policy is not deliver- that another energy is possible, then it shows ing the levels of emission reductions required that a different climate future is possible. The by climate science. Global emissions contin- alternative that neoliberal capitalism has to of- ue to climb and CO2 levels are presently 60% fer—ecological degradation and out-of-control above where they were in 1990, a statistic that global warming—is simply not acceptable.

Other TUED Studies

The Great Inaction New Trade Union Perspectives Sean Sweeney - September 2014

Global Shale Gas and the Anti-Fracking Movement Developing Union Perspectives and Approaches Sean Sweeney and Lara Skinner - June 2014

23 SEAN SWEENEY ENERGY DEMOCRACY IN GREECE

References

1 I am grateful for the input and suggestions of the government said that about 30 percent of several comrades: Anastasia Romanou at NA- PPC’s resources would be spun off to create a ri- SA’s Goddard Institute for Space Studies, New val company, while the company-owned trans- York, and a member of SYRIZA New York; and mission operator, Admie, would also be sold. also David Hall and Steve Thomas at the Univer- The government’s proposals will mean that PPC sity of Greenwich, London. will transfer to its privately-run spin-off about 2 The discussion here will focus on electrical 1,400 MW of coal capacity and 500 MW each power generation while acknowledging that of water and gas-fired. Paul Tugwell and Tom the energy economy is not just about electrical Stoukas, “Greece Details Plans for Public Power supply; it is also about demand. Similarly, it is Privatization,” Bloomberg, May 15, 2013. not just about electricity, but impacts fuels for 10 Daphne Tsagari, “Greece, Champion of Electric- transportation and industrial and residential ity Hikes,” Greek Reporter, Oct. 31, 2014. use as well. The transition to a clean, truly sus- 11 Katerina Nikolas, “Fuel consumption drops dra- tainable, and low-carbon economy therefore matically in Greece as taxes rise,” Digital Jour- requires actions around transport, energy con- nal, Nov. 19, 2012. servation, and land use changes—but these are 12 N.E. Koukouzas, et al., “The lignite electrici- beyond the scope of this short paper. ty-generating sector in Greece: Current status 3 “The political resolution of the 1st congress of and future prospects,” International Journal of SYRIZA and the great social and political move- Energy Research 28.9 (2004): 785 - 798. ment of subversion,” LEFT.gr, Aug. 5, 2013. 13 “GHG trends and projections in the EU-15.” Eu- 4 Ibid. ropean Environment Agency, 2011. 5 Ibid. 14 “EN08 Emissions (CO2, SO2 and NOx) intensity 6 Greece has some potential in terms of new of public conventional thermal power (electric- small hydropower capacity. It could also take ity and heat) production,” European Environ- advantage of considerable geothermal resourc- ment Agency, European Environment Agency, es, especially near Mylos island, where mea- Jan. 11, 2008. sured temperatures rise up to 325° C at a depth 15 3rd National Communication to the UNFCCC, of 1000 m, and Nisyros, where measured tem- 2011. peratures rise up to 325° C at a depth of 1500 16 Positive effects include reduction of energy m. requirements for heating the winter and an in- 7 A successful energy transition in Greece may crease the growing season. also require the decommodification of electric- 17 “Directive 2009/28/EC of the European Parlia- ity, whereby electricity is no longer regarded as ment and of the Council of 23 April 2009 on the a “thing” to be sold at a certain (varying) rate Promotion of the Use of Energy from Renew- per kilowatt hour. The business model that able Sources and Amending and Subsequently has operated in most countries for decades is Repealing Directives 2001/77/EC and 2003/30/ no longer suitable to a world that needs to re- EC,” Official Journal of the European Union 140 duce consumption and conserve energy. Electri- (2009). cal power must be viewed as a public service 18 It is possible to formulate a “pathway towards a where costs of generation and transmission are 100 per cent renewable energy supply system recovered in a multitude of ways. This is pre- by 2050” for “electricity, heating and cooling sented more as a concept here, but decommod- as well as transport” throughout all member ification (which is not the same as “free”) flows states of the European Union. The challenge from the recognition that both access to energy lies not in a lack of available technologies but in and emissions reductions and climate protec- how to make the right “enabling” policy chang- tion are equally essential and should be treated es: reducing demand; expanding renewable as public goods. energy capacity tenfold; properly mixing hy- 8 B. Metz, et al., ed., Climate Change 2007: Miti- dropower, wind, photovoltaics, biomass, geo- gation of Climate Change: Contribution of Work- thermal, concentrated solar power, and wave ing Group III to the Fourth Assessment Report of power; phasing out all subsidies for fossil and the Intergovernmental Panel on Climate Change, nuclear energy; introducing an EU-wide carbon Cambridge University Press, 2007. and energy tax; and liberalizing the energy mar- 9 “The Economic Adjustment Programme for ket (emphasis added). Zervos, et al., “RE-think- Greece Fourth Review – Spring 2011,” European ing 2050: A 100% Renewable Energy Vision for Commission Directorate-General for Economic the European Union,” European Renewable En- and Financial Affairs, 2011. On June 26, 2013, ergy Council, 2010.

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19 “Law 2773/1999, 2837/2000, 2941/2001, Power of Thousands,” The Guardian, Jun. 14, 3175/2003, 3377/2005, 3426/2005,” Interna- 2012. tional Renewable Energy Agency (IRENA), 2013. 36 Among the companies currently active in 20 “Law 3851/2010,” IRENA, 2013. Greece are: Hellenic Petroleum, Motor Oil, Pub- 21 A new Ministry for the Environment, Energy lic Gas Corporation (DEPA), Prometheus Gas, and Climate Change (MEECC) was established Public Power Corporation (PPC), Public Power in 2009 in order to bring the bodies involved in Corporation (PPC) RES, Mytilineos Group, Ter- the licensing of power together under a single na, Global Energy, Energy Solutions, Solar Cells administrative structure. In 2010 a new legal Hellas, Next Solar, Enova, EDF, Edison, Conergy, framework to accelerate deploying renewable EGL, Acciona, Enel, Eurus Energy, Gamesa, Ro- energy was created (Law 3851/2010) along with kas-Iberdrola, Endesa, WPD, Atel. 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