The use of lignite as Greece’s primary source of energy will end in 2026 with the closure of the last of five units of the Agios Dimitrios Thermal Power Plant in Western Macedonia, and the conversion of the Ptolemaida V unit into an open-cycle natural gas unit. The unit was planned in 2007, with construction beginning in 2015, but was put into trial operation only in the fall of 2022 and into commercial operation in March 2023, costing power utility Public Power Corporation (PPC) 1.5 billion euros to operate for just three years. The flagship of PPC’s lignite units will go down in history as the epitome of and the most expensive monument to Greece’s absence of a long-term energy strategy.
This lack of policy, which burdens consumers and the national economy, runs through the entire history of the unit, from its planning 20 years ago to the current PPC decision to recycle it into a natural gas unit with an additional investment of 300 million euros. The initial decision to construct the unit in 2007 undermined the very clear shift of the European Union toward decarbonization, which imposed punitive measures on fossil fuels. The current decision to convert it into a natural gas unit seems to follow the same pattern. It does not take into account the new energy and geopolitical environment, which emphatically restores energy security as an absolute priority, and the very recent experience of the energy crisis, which highlighted the important role of domestic fuels, not only for securing supply but also for maintaining electricity prices at a reasonable level.
In a Europe that is calmly reassessing its options and prioritizing energy security, Greece is choosing absolute dogmatism. It is replacing its only domestic mineral resource with imported natural gas, without maintaining a single lignite unit as strategic reserve, using gas at more than double the European average and increasing its dependence on LNG imports – mainly from the US – to more than 85%. At the same time, Germany is keeping lignite-powered units until 2038, reassessing its energy options and clearly stating, through Chancellor Friedrich Merz, that “we cannot guarantee [secure energy supply] with renewables alone.”
Greece’s strategy remains fragmented and circumstantial. The energy crisis forced the government to reassess lignite as the only domestic fuel, apart from RES with its volatile production, a stance that overturned PPC’s initial plan to retire all lignite units by 2023 and operate Ptolemaida V after 2025 with natural gas. A few months after the unit’s first test run, Prime Minister Kyriakos Mitsotakis announced during his visit to its facilities in Kozani in February 2023 that the unit would remain in the energy system as a strategic reserve unit after 2028, and noted its importance for the country’s energy security. At the same event, PPC head Giorgos Stassis declared that “the energy shielding of our country dictates that we have every means available to protect ourselves from possible energy crises, such as the one we are experiencing today. A unit such as Ptolemaida V takes on another role, that of energy stability, today much more so and in the future as a strategic reserve.”
The energy crisis found Greece with lignite power plants already decommissioned and the prime minister asking PPC to double its production to contain electricity prices that have skyrocketed due to the high price of natural gas and the country’s heavy dependence on imported fuel. In 2022 alone, the country spent 7 billion euros on natural gas imports, when under normal circumstances the amount should have been 1 billion euros, as Mitsotakis himself said, recognizing what dependence on imported fuel means. During the same year, the extension of the operation of PPC’s lignite units benefitted consumers by around 700 million euros. In this climate, the Ptolemaida V, transformed from PPC’s “ugly duckling” before the energy crisis into a “swan,” culminating in September 2023, when it was awarded as “the largest project of the decade 2012-2022” at an infrastructure and transport conference. The award was received by the then-deputy minister of energy Alexandra Sdoukou, who said the unit “is shielding the country’s energy security in difficult times.”
Just two years later, and while circumstances have worsened, PPC switched gears again and announced at another event in Kozani the conversion of Ptolemaida V into a natural gas unit from 2027 and at the same time the complete abandonment of lignite at the end of 2026. The shift is part of the company’s overall energy plan for Western Macedonia, amounting to 5.8 billion euros over a five-year period. The Regulatory Authority for Waste, Energy and Water (RAAEY), responding to PPC’s request, recently gave the green light for the modification of the unit. According to PPC’s plan, the transition will take place in two phases, investing an additional 300 million euros. First, Ptolemaida V would transition into a 350-megawatt open-cycle natural gas unit by the end of 2027, and then it would be upgraded to a combined-cycle gas turbine that will exceed 1,000 MW. To supply the unit, gas grid operator DESFA will construct a new natural gas pipeline of about 10 kilometers in length with delivery in the third quarter of 2027. Ptolemaida V is a glaring example of everything that is wrong with Greek energy policy, but it is not the only one. The Melitis II lignite unit, PPC’s most modern after Ptolemaida V, with a capacity of 330 MW, was put into commercial operation in August 2003. A total of 571 million euros was spent on its construction and it was withdrawn after less than 20 years without ever being able to operate at full capacity because its lignite supply was based on an unfeasible plan. For most of its operation, the Melitis unit operated at one-third of its capacity, while PPC very often put it out of operation due to a lack of fuel.
PPC’s Megalopolis V power station in the Peloponnese, with a total capacity of 811 MW and a cost of 543 million euros, was inaugurated in April 2015. For five years, however, it operated at 500 MW of its capacity as the Independent Power Transmission Operator (ADMIE) argued that the Peloponnese transmission network could not carry a greater amount. After pressure from PPC, ADMIE finally allowed the unit’s full integration into the system. PPC also argued that there was no issue of network saturation, since the other two Megalopolis lignite units were either shut or operated well below capacity as a result of hefty CO2 emission rights costs.
The infamous Mesochora dam, a hydropower plant in Trikala worth over 300 million euros (or 500 million in current value) which was completed in 2001 but never actually operated, is another illustrative case of the country’s deadlocked energy planning.
Long-standing problems such as legal battles and reactions by local communities also plagued the Attica-Crete power link. The emblematic interconnection, costing 1.1 billion euros, which started commercial operation in December 2025, will operate at a limited capacity at least until 2027 as the reactions of the local residents have not allowed ADMIE to complete the Damasta-Hania section to upgrade Crete’s internal network. This section is necessary for the safe operation of the interconnection at 100% of its capacity.
(ekathimerini.com, January 14, 202)