PPC and CMEC to Build Coal-fired Plant
China Machinery Engineering Corporation (CMEC) signed a memorandum of understanding on Wednesday with Greece's leading utility Public Power Corp. (PPC) to build a coal-fired plant in northern Greece.
Under its "one belt, one road" strategy, China has been investing heavily in Greece in recent years, aiming to turn the country into a transhipment hub for its products into Europe.
Last month, China's shipping conglomerate COSCO wrapped up the purchase of a 51 percent stake in Greece's largest port Piraeus, while State Grid Corporation of China has been shortlisted for a 24 percent stake in Greece's power grid ADMIE.
PPC, which is 51 percent state-owned, said in August it would team up with CMEC and private investors to tap coal mines in the northern Greek region of Florina and build a second, more efficient coal-fired power plant.
It was the first such agreement PPC, which previously dominated in power production, has struck with a foreign company.
PPC controls about 60 percent of the wholesale electricity market and some 90 percent of the retail market. Under an international bailout signed last year, Athens must cut PPC's share in both markets to below 50 percent by 2020.
"The signing of the agreement is a good opportunity to boost our cooperation and taking into account the long-term interest of the two sides, we can deepen our partnership," CMEC Assistant President Fang Yanshui said at a signing ceremony.
CMEC is mainly engaged in international projects and has built a large number of thermal, hydroelectric and renewable energy units around the world.
PPC's Chairman Manolis Panagiotakis said PPC, CMEC and the private investors would set up a new firm which would build a 450 megawatt power plant at an estimated cost of 750 million euros.
Greek contractors Ellaktor and GEK-TERNA will also take part in the construction.
"We aspire to play a major role in our neighbourhood," Panagiotakis said. "Our partnership with companies of a calibre similar to CMEC's will be decisive."
He said the firm could be set up next year and construction, which could take four to five years, might start by 2018.
Panagiotakis also said PPC's board has decided to expand in neighbouring Albania by setting up a company which will be active in power trading and production.
(Reporting by Angeliki Koutantou)
