Industrial action over electricity deregulation

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A draft bill on further liberalisation of the electrical power market, issued by the Greek Ministry of Development in June 2003, has provoked strong reactions from the industry's workers, who held protest strikes in June and July.

Law 2773/1999 (published in the Government Gazette on 22 December 1999) partially liberalised the electricity market and regulated a number of energy policy matters, including the establishment of an independent Regulatory Authority for Energy (RAE), supervised by the Ministry of Development. At the behest of the Ministry, parliament approved a special amendment to this law, excluding the Public Power Corporation (DEI) - Greece’s main generator and sole distributor of electricity (established as a public enterprise in 1950) - from competitions organised in future to obtain additional electricity generating capacity. The aim was to reduce DEI’s share in total electricity generating capacity from 98% to 75%, with the ultimate objective being to ensure the viability of private enterprises in the sector. This rule has forced DEI (which became a company in 2001) to sell off existing plants, in order to achieve a reduction in its capacity and meet the conditions that will allow it to participate in such competitions in the future. Furthermore, the Ministry of Development has since drawn up a series of alternative schemes to implement liberalisation of the electricity market.

During the dialogue carried out before Law 2773/1999 was passed, the DEI General Staff Federation (GENOP-DEI) asked the Ministry of Development to allow DEI to submit a complete dossier to the European Union, seeking compensation to offset costs associated with the DEI’s operation of non cost-effective units, or other non-productive expenses, in the context of market liberalisation. The EU authorities agreed with the in-depth analyses of the DEI management, supported by GENOP-DEI, and approved funding of EUR 1.4 billion to offset the consequences of the liberalisation.

A new draft bill on the further liberalisation of the electricity market was submitted and published by the Ministry on 18 June 2003. Its content, and particularly an amendment promoting the free entry of private companies into the electricity generation market, took both DEI management and GENOP-DEI by surprise. GENOP-DEI held an extraordinary meeting on 19 June, at which it unanimously rejected the draft bill. The union assessed the draft as detrimental to the Greek economy as a whole, because it will: weaken DEI by forcing it to reduce its share of electricity generation to 75%, with an attendant loss of jobs; and result in an increase of around 25% in the electricity price per kilowatt-hour, an increase damaging to the role of the DEI as a public utility. For these reasons, GENOP-DEI held a series of strikes on 22 and 26 June and 3 July. In addition, on 26 June around 50 GENOP-DEI members, headed by their president, protested by staging a 'symbolic' occupation of the RAE. On the same day in Brussels, Greek government representatives were among those agreeing the final text of EU Directive 2003/54/EC concerning common rules for the internal market in electricity. According to the provisions of this new Directive, by 2004 Greek (low- and medium-voltage) electricity consumers, not including households, will be free to choose their supplier, and by 2007 the household market will also be 'liberalised'.

Industrial action was accompanied by a series of announcements by GENOP-DEI, denouncing the amendment to the law, which in the union’s view will lead to an upheaval in the electricity market and erode the existing institutional framework. The union executive has stated that if the controversial clauses are not withdrawn, it will step up industrial action.

Just prior to the publication of the controversial bill, on 4 June 2003 a new sectoral collective agreement for electricity generation was signed by GENOP-DEI and DEI management, including provisions on pay and other matters which the union views as positive 'victories' for its demands. In particular, the agreed pay increase of 4.8%, to be awarded in two instalments, is more than adequate to offset inflation. At the same time, sums have been secured to introduce a new pay scale over three years from 1 January 2004, with a total of EUR 28.5 million to be distributed among employees as additional pay.

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