Moving forward or slowing-down? Exploring what impedes the Hellenicenergy transition to a sustainable future

Evanthie Michalena a,1, Niki Frantzeskaki b,⁎a ENeC Laboratory (Environment, Nature and Culture), UMR8185 — CNRS, Sorbonne and Paris 8 Universities, 191 Rue St Jacques, 75005, Paris, Franceb Dutch Research Institute For Transitions, Faculty of Social Sciences, Erasmus University Rotterdam, Burgemeester Oudlaan 50, 3000 DR Rotterdam, The Netherlands

a r t i c l e i n f o a b s t r a c t

Article history:Received 31 December 2011Received in revised form 19 September 2012Accepted 2 October 2012Available online 7 November 2012

Renewable energy (RE) can be considered as one viable option to help address concerns ofenergy autonomy and carbon reduction. This is especially true for Greece, where the electricitydemand increases, the economic situation is likely to remain challenging and EuropeanDirectives call for a mandatory supply of RE into the national energy mix. However, althoughsteps have been made to make investment conditions seem favourable, the Hellenic electricitysystem has not achieved the expected embedding of RE in the grid, resulting in a laggingenergy transition to a more sustainable energy system. We explain facets of the present dayenergy policy context and the historical evolution of the energy sector through a PEST analysis.The analysis reveals no lack of opportunity and effort, but institutional, social andtechnological misalignments in terms of developments and change. A comprehensive analysisis used to unpack the interfaces between institutions, society and technology and from this anumber of options are identified which could potentially remove the sector disintegration andstrengthen the functionality of these interfaces. Whilst no panacea for effective penetration ofRE in Greece is apparent, the conclusions suggest that there is a pressing need for future energygovernance to be more integrative and holistic to encompass the array of stakeholders in REpenetration in order to facilitate meeting EU RE targets by 2020.

© 2012 Elsevier Inc. All rights reserved.

Keywords:Energy governanceGreeceDisintegrationPolicyInnovationEnergy institutionsTransitions

1. Introduction

Renewable energy appears as one of viable alternative options that can answer to concerns on energy autonomy and carbonreduction. This is why the European Directive 2009/28/EC calls for mandatory supply 20% of energy needs by 2020 fromrenewable energy; including 10% renewable energy in transport [1]. According to estimations of [2], the electricity demand inGreece will increase in following years (predicted to be 80,000 GWh in 2020 from 53,750 GWh in 2007), and similarly for energypeaks (16,000 MW in 2020 from 10,600 MW in 2007). The increase of electricity demand is an incentive for investments inenergy generation. At the same time, the doubling of electricity cost of solid fuels (due to the cost of GHG emissions purchase:€25–50/ton of emissions), together with the generous institutional framework for renewable energy in Greece (significant capitalsubstitutions and guaranteed feed-in tariffs), become an important leverage for renewable energy development [2]. Apart fromsuch incentives for investments, additional political interest has been recently demonstrated considering renewable energy as astrong Hellenic advantage for foreign investments that in turn will benefit the economy. The project “Helios” which is currentlyunder discussion between the German and the Hellenic State is a representative example [3].

Although investment conditions appear favourable, the Hellenic electricity system has not achieved the expected embeddingof renewable energy in the grid and renewable energy has not reached its full potential yet; resulting in a lagging energytransition to sustainability. To give an indication of the progress achieved until recently, in 2006, renewable energy in EU-27

Technological Forecasting & Social Change 80 (2013) 977–991

⁎ Corresponding author.E-mail addresses: michalena@hotmail.com (E. Michalena), frantzeskaki@fsw.eur.nl (N. Frantzeskaki).

1 Τel.: +30 6977348015.

0040-1625/$ – see front matter © 2012 Elsevier Inc. All rights reserved.http://dx.doi.org/10.1016/j.techfore.2012.10.013

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accounted for 7% contribution in the European energy mix (402GW), whereas in 2008, renewable energy (RE) contribution inEU-27 was 8% (411.987GW). Corresponding numbers for Greece were 9.44GW (6% in the energy mix of EU-27) for 2006 and9.517 GW (5% in the energy mix of EU) for 2008 [4–6]; a demonstrable lag behind Europe.

What impedes renewable energy increase in the Hellenic electricity system has not been fully explored. Past analyses fromHellenic energy scholars have focused on sectoral issues related to renewable energy, such as the impact of specific policies andlaws on the energymarket restructuring [7], the impact of specific policies or of the energy policies altogether on the adoption of aspecific energy technology (e.g. wind energy [8]; biomass [9,10]), the impact of institutional settings on specific regions [11–13],and the implications of specific energy technologies for renewable energy mixes in Greece [14]. These mono-focused studies -albeit valuable- cannot inform policy institutions neither for the causes of a lagging energy transition to sustainable energyfutures, nor for the needed actions to promote this transition due to their narrow focus and technology-oriented objectives.

We are interested in investigating the interface between all those studies in order to identify impeding conditions and indicategood energy governance perspectives for Greece; also considering small-scale investment incentives on renewable energy. Weaim to respond to the following research question: what impedes the sustainable energy transition in Greece? In view of this, weadopt the “vision of a sustainable energy system in Greece” as being formed and defined by the energy targets and ambitionsformulated in national strategies and the EU 2020 Energy Strategy. A transition to this sustainable energy system includesprocesses and agents that act upon realizing and achieving the institutionalized vision.

For investigating the impediments, we conduct a systematic exploration of the Hellenic electricity system's context andunravel what constitutes the energy problem. In doing so, we first need to understand the evolution of the energy system so as toindicate the points of disintegration that have historically developed. We thus undertake a multi-faceted analysis in order toreveal what impedes the sustainable energy transition. We only focus on electricity production from renewable energy (RE). Theheat generation from RE and biofuels are not included in our analysis. We then propose ways to promote the integration ofinterests and policies that respond to institutions, society and technology.

2. Research methodology

In our research we undertake three steps:

(a) we explore the evolution of the Hellenic energy sector in a multi-faceted analysis that accounts societal, institutional (legal,policy and organizational altogether), technological and economical developments in order to gain understanding abouttheir interdependencies and impacts on the energy system. We use PEST analysis as a descriptive technique tosystematically analyse each facet in depth. We then synthesize the insights from the PEST analysis by criticallyinvestigating the developments and dynamics at the interfaces of these facets. In this step we realise a diagnosis of theenergy problem.

(b) we then reveal that slow-penetrating renewable energy electricity is due to pathologies caused by the disintegrationbetween (i) institutions and society; (ii) society and technology and (iii) institutions and technology. The identified gaps inthese three interfaces constitute the disintegration problem that is manifested with the energy problem.

(c) from the disintegration identified in the renewable energy electricity system, we propose a set of indicative actions forintegrating institutions, society and energy technology to accelerate the sustainability transition of the Hellenic energysystem.

These steps and their relation are given diagrammatically in Fig. 1.Desk research involved an extensive bibliographic study of a wide variety of documents and records related to the energy

system, including: research articles, legislation, EU directives, policy documents, newspaper articles and Ministerial Developmentprograms.

The field research method was expert consultation. Expert consultation was realized in two stages. In the first stage, expertconsultation was realized with in-person semi-structured interviews in the period of 2007–2008 for validating the analysis'results. We interviewed policy advisors for energy planning employed by the Hellenic Ministry of Development and EU-DGEnergy (at that time), one energy policy researcher working at a Hellenic University during his attendance to the European Unionorganized event “EU Sustainable Energy Week 2008” that was held in Brussels and an NGO representative during an EU meetingheld in 2007 in Brussels. It is noted that the researchers and advisors accepted our request for an interview under the conditionthat their anonymity is preserved.

In the second stage, expert consultation was realized with three independent energy researchers from different HellenicUniversities for further verification of the analysis and research outputs. Expert consultation took place during the analysis of thedata and the preparation of the current study (autumn-winter 2011). During these expert consultation interviews the currentstatus of Hellenic energy sector has been examined and verified. In the Appendix A (Table A.1) we list the interviews' dates andplace and the professional profiles of the interviewees preserving their anonymity.

The paper is structured as follows: first we start with the energy context and problem analysis. To do so, we present achronology of the energy system evolution and then we describe the institutional, technological and social spaces that constitutethe renewable energy electricity landscape in Greece. At a later stage, we focus on the institutional performance of the energysector spotting and analyzing its pathologies and deficiencies. Then, we investigate the causes of institutional pathologies anddeficiencies in the disintegration (gaps) between institutions, society and technology. An analysis of the disintegration of theenergy sector gives an in-depth view of energy institutions' operation and the associated performance failures. We propose

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measures to respond to disintegration. We conclude with a discussion of the integration challenge and the uncertainty that thecurrent financial crisis poses to energy institutions and to the renewable electricity market in Greece.

3. Exploring the Hellenic energy context

3.1. Chronology of the Hellenic energy system evolution

Three periods have been defined as having restructured the regulatory environment of the energy sector in Greece [12,15].Table A.2 presents the key determinants of the institutional evolution of the Hellenic energy sector in a chronological order.

During the electricity introduction phase (1889–1949) the energy market was a liberalized market. System inefficiencies inthe form of high prices of electricity and sudden black-outs were experienced due to the infancy of the system. Such systemfailures triggered the demand for a reliable electricity system in the beginning of the nationalization phase (1950–1998). Theintroduction of a new market player (the Public Power Corporation, PPC) signalled the gradual nationalization of the energysystem in Greece (1950–1956). For almost 50 years, the electricity sector has been organized according to the monopolisticmodel: a vertically integrated, 100% state-owned company, namely the PPC, was granted exclusive rights for all electricityactivities. National laws supported the market monopoly of PPC and renewable energy systems were introduced but developedby PPC exclusively. Law 1559/1985 was the first legislative effort that considered alternative forms of energy for powergeneration and was mainly focused on exceptions to the exclusive right of PPC to generate electric energy. Public funding for theinstallation of renewable energy systems (RES) was provided by a number of national laws (Law 1892/1990; Law 2244/1994; Law1559/1985; Law 2601/1998) and development programs during this phase. Standardization of practices concerning theinstallation of renewable energy facilities was also provided (Law 1559/1985; Law 2244/1994). Law 2244/1994, devoted entirelyto RE electricity, established the legislative platform for the development of RE. Law 2244/1994 provided access to the grid forindividual energy producers, provided a fixed feed-in price roughly 90% of the household electricity rate applicable at each timefor RE and made it obligatory for the PPC to buy that energy.

Law 2773/1999 introduced a specific regulatory framework for the implementation of RES. It established the independentRegulatory Authority for Energy (RAE) (separated from the Ministry which deals with energy issues), the independent Electricity

Fig. 1. Methodology mapping: the analytical building blocks and their relation to the research question.

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Transmission System Operator and initiating the deregulation of the electrical energy market. This law -following to Greece'sEuropean obligations- signalled the pass to the liberalization phase from 1999 to today.

A crisis in the form of riots and reactions of PPC's employees due to fears for the loss of working places temporarily sloweddown the liberalization process. PPC's boycotting efforts are still evident and are expressed through several manipulations ofprices when trading in the wholesale market and the lack of full development of electricity transmission lines. This means thateleven years after the start of market liberalization, the former monopolistic company PPC -now converted into a share companyunder the name PCC Ltd-, still holds a highly dominant position in both the electricity generation and power supply markets.Indeed, apart from PCC and some renewable energy producers (4%), the share of independent power producers (natural gas)stands at 18%, representing a relatively small percentage of the interconnected system's installed capacity. With regards toelectricity supply, all customer tariffs applied by PPC are regulated by the state and their structure still includes largecross-subsidizations among customer categories. It is also claimed that the level of regulated electricity prices is below powergeneration costs. As a result, PPC holds more than 76% of the market share and the energy production sector continues to follow acentral planning paradigm around two locations rich in local energy resources (mostly lignite): one in Megalopolis(Peloponnesus/Southern Greece) and another one in Ptolemaida (Western Macedonia). These large-scale thermal units areresponsible for the energy supply of Southern and Northern Greece. The centralization of the electricity system has resulted in alimited expansion of renewable energy due to insufficient availability of electricity grids [16,17]. In most Hellenic islands the lackof interconnected grids leads to a lack of investments in RES [18,19].

Despite the weaknesses mentioned above, since 1999 up to today, a number of laws support the liberalization of the Hellenicelectricity market and support the increase of the renewable energy market by simplifying the authorization procedure for RE, byfinancial support and by knowledge distribution.

3.2. The Hellenic electricity context: outputs from a PEST analysis

The RE target is 18% of RE in gross final consumption of energy for Greece for 2020 [1]. According to the National RenewableEnergy Action Plan for RES [20], the installation of almost 7.5GW of wind energy plants is foreseen, together with 2.2GW of PVs,250 MW of CSP plants, 120 MW of geothermal energy, 250 MW of bio-energy installations (biogas and solid biomass), 250 MWof small hydro plants and an additional capacity of large hydro plants (350 MW) and pumped storage plants (880 MW), resultingin a 40% RE share in electricity production.

Realized investments do not suffice for achieving the RE target of 18% of RE in gross final consumption of energy in Greece for2020 [21,22]. For a successful RE penetration, a more favourable landscape is needed. Based on Ansoff's business strategy theory[23], a favourable landscape includes opportunities and stimulators in four different spaces: political (and legal) space, economicspace, Sociocultural or social space, and technological space. These are known as P-E-S-T spaces. We employ the PEST method toexplore the status of the Hellenic energy sector.

3.2.1. Political spaceHellenic energy institutions and organizations have evolved over the last years and laid economic incentives and deregulated

market conditions that enable renewable energy facilities embedding. Since the European Directive 2009/28/EC has laid downmandatory targets for renewable energy in the energy mix of State Members, a new Ministry, the Ministry for the Environment,Energy and Climate Change (MEECC) has been established, in order to bring, under a single administrative structure, therespective bodies involved in the licensing of power plants. MEECC considers energy, environment and fiscal conditions andinterests in long-term policy design that addresses climate change challenges. MEECC in collaboration with the Hellenic EnergyRegulator (Regulatory Authority for Energy, RAE) have conducted several reviews of the national legislative framework of RE.They suggested that simplifying authorization procedures and laying down incentives for simplifying the access of small privateinvestors to the RE market are needed (especially when photovoltaic electricity is concerned).

Since 2009, significant institutional changes toward the effective opening of the electricity and gas markets have been taken[24]. Law 3851/2010 sets ambitious national targets for RE (namely 20% on final energy consumption, 2% above the mandatorylevel of 18% set by Directive 2009/28/EC). The triple targets of the 20–20–20 are considered as both obligations and opportunities,as these targets include: ensuring energy security, reducing national greenhouse gas emissions (GHG), boosting thecompetitiveness of the economy, attracting investment capital and technical knowhow. It is estimated that the achievement ofthose targets will result in economic improvement of rural areas. RAE together with the Hellenic System Operator (DESMIEin Greek) closely monitors the wholesale electricity market and the competition between fuels. RAE also tries to preventdistortions or monopolistic attitudes in favour of lignite or natural gas and to increase the RE percentage in the grid. In the retailmarket, the low and medium voltage tariffs remain regulated by the State.

Despite the efforts of setting a favourable institutional space, small flexible systems (like small wind generators) have not beenencouraged for their use from investors, and authorization procedures have remained complicated [20]. Pricing and trading of REagainst other fuels in the market are not transparent and these create additional business insecurity to producers and energysuppliers as well as distorted competition. Other RES (i.e. biomass, biogas or geothermal energy) are fairly addressed in thecurrent energy agenda.

Installation processes of renewable energy technologies (RET) remains highly bureaucratic. Some of the licenses requiredinclude the electricity generation license, installation and operating permits, environmental permit, planning license, connectionagreement with the Utility (PPC) and power purchase contract with the grid operator (HTSO). Additionally, the evaluation

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process of the generation permit includes a number of criteria (such as the investor's technical and financial capability, project'sviability and compliance with two basic provisions of the existing physical planning). The awarding of Environmental Termscreates new charges for the investors. The evaluation for granting the Environmental Terms Approval (ETA) depends on theproject's environmental impact. ETA's evaluation is carried out either by the Department of Environment and Physical Planning ofthe local Region or by the Special Unit for Environmental Licensing of MEECC and requires consent by several administrativebodies including local authorities. After receiving approval of an ETA, an Installation License is required, which is issued either bythe General Secretary of the Region or by the Minister of MEECC. In parallel, the operator applies for terms for connecting to thegrid to PPC and for a power purchase contract to HTSO. Finally, the Operation License has to be issued by MEECC, the body thatissued the Installation License, after the construction is finished and the plant has undergone commissioning tests.

3.2.2. Economic/market spaceMeeting the targets setwithin the renewable energy roadmap until 2020 calls for the elaboration of policies andmeasures and the

acceleration of the Hellenic economy through “green” development and enhanced competitiveness of the private sector. The REsector is dominated by solar andwind investments. This is due to thematurity of technologies related to sun andwind and due to thepolitical will that strongly encourages these technologies. In [20] is stated “In the beginning of the 10-year period to 2020, thetechnologies and related investment projects with the higher maturity and potential for contribution to the electricity generationhave been considered first” (translated in English by the authors). Private investors hesitate to invest in RE market due to financialreasons: a) high initial cost of investment on renewable energy technologies that “small, private enterprises” cannot hold,b) hesitations from banks and financial institutions to fund RE projects due to uncertain economic environment and the economicsituation of Greece, and c) complicated licensing procedures that hamper private funding organizations (i.e. banks) to invest in RE.

In order to encourage private investors into RET, the first steps toward RE exploitation have been done by the formerelectricity utility (PPC Ltd). PPC Ltd as one of the most powerful energy utilities in Greece gradually reformed its fuel portfolio andorganizational policy to invest in RE projects costing €2 billion until 2015, aiming at 20% of renewable energy into the nationalenergy mix until 2015 and 30–35% until 2020. At the same time, old lignite-fuelled power units will be replaced by new ones; aninvestment budgeted to €1.38 billion [21].

Law 3851/2010 set mandatory deadlines for the intermediate stages of the RE projects licensing procedure so as to facilitateinvestments and to streamline the authorization process; complying with the Directive 2009/28/EC [20]. Additional to theaccelerated licensing process established by Law 3851/2010, another special licensing process entitled “Fast Track Licensing” isintroduced for large-scale RE projects, which provide employment benefits locally and attract substantial capital. Currently, thecriteria for Fast Track Licensing refer to investments greater than €200 million or greater than €75 million if they result increating at least 200 new jobs. Fast Track Licensing compacts the full licensing of large-scale RE projects within four to six months.The process is undertaken through the newly established “Invest in Greece” Agency.

Big private investors have recently expressed interest for geothermal energy systems. MEECC awarded to the Hellenicconsortium “Terna Energeiaki” the allocation of four geothermal energy fields in Evros, Nestos, Samothrace and Chios where REprojects (valued more than €190 M) will be developed. The contest for the allocation of rights was out in November 2010 andconcerned fields of both high and low enthalpy in Evros, Nestos rivers, Samothrace and Chios islands [25].

In this market space, small private investors face administrative barriers and the lack of collaboration with the centralauthorities. Comprehensive information and assistance on the processing of authorization, certification and licensing applicationsand on assistance to applicants for renewable energy generation are only available through public-state organizations such asRAE, the National Transport System Operator and the MEECC. As stated in [20], recently potential applicants and every personinterested in renewable energy technology can submit requests to RAE, Centre of Renewable Energy Sources (CRES) or the ‘Investin Greece’ Agency, in order to receive information and guidance (in compliance with the requirements set by the Law 3851/2010).Herewith, we note that small investors are constrained by institutional discontinuity and the non-compliance betweeninstitutional conditions, investing demand and existing energy infrastructures. Examples about photovoltaics (PV) illustrate theseconstrains in the following paragraph.

According to Law 3468/2006, a PV deployment scheme has been put in place with a Ministerial Decree, on 2007 (694/2007).The scheme was then revised by virtue of Ministerial Decree 1276/2007. According to this plan, a total of 540MWp is to beinstalled in the interconnected grid of the mainland, 200MWp in the islands and 50MWp for off-grid applications, over the period2007–2010. A specific geographical distribution of these installations was specified (setting upper limits per region) taking intoaccount the solar radiation distribution over the country and the technical limits set by the electricity systems of the islands.Environmental and social concerns have been considered, since about 40% of the target is to be covered by small-scale systems(up to 150kWp), in order to have minimum environmental impact, to reduce network losses and create local jobs and sources ofincome. This scheme is now suspended temporarily by virtue of Ministerial Decree 707/2008, in conjunction with high feed intariffs that are foreseen for electricity produced by PV systems. Although the institutional favouritism toward PV has resulted inthe increase of PV applications for production permits (6,200 applications), 4,000 out of those encounter problems on their way tofurther licensing and connection to the grid due to insufficient grids that cannot absorb the power produced.

3.2.3. Social spaceTo motivate the acceptance of RE use in Greece, job creation opportunities are promoted as a main benefit. For example in the

PV sector, the new German-Hellenic initiative “Helios” promises 10,000 MW in 200,000 hectares of land and 60,000 new jobs[22]. Private companies that produce and export PV systems as well as on design, constructing, and maintain PV systems

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contribute to an increase of the employment rate locally. Because of RE's (expected) employment benefits, campaigns and publicpromotion programs were targeted to increase renewable energy acceptance. In 2008, during the national campaign for thepromotion of renewable energy, the National Centre for Renewable Energy Systems (CRES) distributed guidebooks for theassessment, evaluation, environmental impact and installation procedure for all different RES. CRES has issued a series ofhandbooks with best practices regarding installation and incorporation of RES. Law 3851/2010 sets specific targets for newbuildings, which mandate the use of RET, cogeneration of electricity and heat, systems of district heating at district scale or percity block, and heat pumps to cover 10% of the energy needs by 2014. A number of initiatives have been introduced to promoteenergy conservation and RE utilization at local level, such as energy saving programs (i.e. the programme “Exoikonomo” thatfunds energy saving initiatives).

In terms of training local authorities on the RE licensing procedure, the MEECC communicates main policies and/or informs andtrains local authorities through official explanatory documents and circulars. At the same time, local authorities have continuousaccess to theMEECC serviceswho offer their support. A number of seminars that address administrative issues have taken place in thepast, either ad-hoc or in the scope of the continuing education programs of the Training Institute of the National Centre for PublicAdministration and Local Government. The new one-stop shop agency of theMEECC, in cooperationwith CRES is currently planning aseries of seminars for local officials on the changes introduced by Law 3851/2010 regarding licensing procedures.

What however is observed is that there is still local opposition against RE projects mainly due to planning reasons [8]. Forexample, the erection of a small wind park of 2.7 MW in Chania, Crete was confronted with high local opposition. The developerof this park has received the permit to install the RES project in 2003 and after a variety of additional permits (including theEnvironmental Impact Assessment Study) he finally got the installation permit in 2008. Since 2008 a group of inhabitants hasharshly resisted and reacted to the installation (with actions such as burning road axes machineries in 2008, the submission ofquestions to the Hellenic Parliament, the appeal to the Courts of Justice and the Region of Crete, the Supreme Courts of Justice plusseveral publications in the press against the specific project). Until January 2011, the project has not been installed [26]. Theresistance of society has also been demonstrated in the case of the inappropriate use of geothermal energy in Milos in 1980s.Inappropriate technology of the geothermal energy plant caused decades of reluctance toward RES [27,28].

With Law 3851/2010, the barrier of the social, local opposition is addressed with the provision of redirecting a significantpercentage of the RE special levy retained byHTSO from the gross revenues from electricity sales of RE facilities (with the exception ofPVs) (i.e. 3% before VAT, to the local communities). This measure exists since 2009, but was further institutionalized in 2010.

3.2.4. Technological spaceWhen we refer to technological space, we address a) the purchase of RE equipment and its use, b) the sufficiency and status of

the grid, c) the research and development (R&D) in laboratories.When it comes to wind energy generators or geothermal energy appliances, equipment is mainly imported, due to lack of RET

know-how at national level, lack of willingness or funds to proceed with innovation and high costs for RET start-ups. A differentreality exists for PV systems. Due to private efforts and motivation, PV modules are produced in Greece by five new industries thatbuild PV panels and equipment, with a total of 800 employees and with an installed PV capacity of 51 MW. Products exported for2010, were 40 MW of wafers, 48 MW of cells, and 19 MW of PV panels [29].

When it comes to the use of RET, certificates of quality are required and include: a quality certificate for the connection of awind park with the electricity grid, a Wind Turbine Type Certificate and a Power Quality Certification. The Power QualityCertification can be issued either by CRES or by a foreign organization that is recognized by the competent authorities. The sameapplies to Wind Turbine Type Certificates. The wind measurements on site, necessary for the issuance of the Generation Licenseneed to be carried out by certified bodies, in accordance with standard DIN-EN ISO/IEC17025/2000. For PV that are connected tothe grid, an ISO certification of the manufacturing company of the PV modules and inverters is required for all the systemsconnected to the Medium or High voltage grid. For PV installation in buildings, standard IEC 60364-7-712 should be applied. Forthe interconnection of the inverter to the grid, the requirements set by the Distribution or System Operator for protection andpower quality that include the EN50160 standard and the EN61000 series of standards have to be met. Still, problems derivedfrom the improper design or renewable energy appliances so as to meet local conditions (i.e. climate) or the requirements for thegrid have been observed in the past (or example with wind turbines in municipal wind park of Lesbos island and wind turbines inKythnos and Mykonos islands. In these cases, an underestimation of the maximum wind speed (during the design phase) meantthat the operation of wind turbines was outside their operational range leading to the destruction of the wind turbines. This hasresulted in mistrust of wind systems' potential.

The delayed completion of the legislative framework has led owners and manufacturers, who have attempted to implementinnovative RET, to cease installations after the intervention of the competent supervisory authorities and litigation because due toarbitrary construction. For example, the legislative framework for the licensing of PV systems was established in 2010 (Law 3851/2010) [30] whereas the first PV systems were installed in mid-1990s. Even today, Greece is suffering from the lack of nationalregulations that support innovations. Despite that efforts to develop innovations are boosted in private or public researchlaboratories by European funding (i.e. FP7 Program “Capacities”), there is neither information and/or transparency at agovernmental or social level on how RE innovations proceed in the R&D laboratories, nor any systematic information on pilotsmall-scale RET applications (e.g. in houses). Recently, offshore wind energy is under discussion, but information about social,political and environmental implications remain disclosed to the public.

The government has not endorsed efforts toward the implementation of geothermal energy technologies even though thepotential is high (in both low and high enthalpy applications). The reason is that geothermal energy is considered to be an

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intrusive RET for the natural and human environment of the area to be installed. Recently, the political interest towardgeothermal energy is changing, as this technology is considered useful to meet the targets and capable of attracting economicbenefits for the area to be developed. MEECC plans to produce 15 MW until 2014 in three pilot areas and then go to biggerprojects. Candidate areas for geothermal energy exploitation include Milos, Nissiros, Lesvos, Methana and Kimolos. There is theestimation that in Greece, 400 MW can be produced by geothermal energy without the need for deep drilling. According toMEECC, the price of every produced KWh in Greece will be €99.45; while in Germany the corresponding price can attain €200 dueto the required deep drilling. In Methana and Kimolos, water desalination units are to be installed that will operate withgeothermal energy [31].

3.3. Problem analysis: revealed pathologies and the energy problem

The above analysis has shown that, when it comes to RE penetration into the market, a) opportunities and efforts are there,b) social, economic and technological developments are strongly related (and sometimes led) by institutional changes and/orprivate motivation; c) almost all efforts or problems observed in the development of RES, bring at the same time institutional,social and technological downfalls, and d) big investors are privileged while opportunities are not generously provided to smallinvestors.

The table below summarizes the initiatives and factors that the PEST analysis has revealed as being there to boost thedevelopment of large-scale RE projects (Table 1). In the next step of our analysis, we deal with the political and economical spacestogether as “institutions” [12]. We keep technology and society as separate emphasis spaces and we have seen the PESTobservations as interfaces between the three categories: society–institutions, society–technology, and institutions–technology.

Triggered by the outcomes of the PEST analysis, we now focus on the institutional weaknesses of the RE electricity sector inGreece so as to reveal what impedes the transition of the Hellenic energy system to sustainability. A starting observation(Section 3.2) is that the energy system has the tendency to institutionalize practices with expected positive impacts on the energymarket [32,33]; without considering existing market demands, especially when they come from small investors or end-users. Theenergy market is regulated to the extent that the national law sets electricity prices and buy-back rates. The policy objectives forthe energy system opt for a greater percentage of RES in the market and Hellenic Laws include the provision of fixed (flat)buy-back rates for RE-based electricity that favour big investments. In this way the market transactions are bounded by

Table 1Existing initiatives and factors boosting/enabling renewable energy use for electricity generation in Greece.

Between society–institutions• International concerns (i.e. climate change) and European concerns (i.e. energy autonomy) provide RE with economic and institutional protection.• Laying down of market conditions in Greece favour liberalization of the electricity market, decentralization of energy generation units andcompetitiveness of the private sector.

• Evolution and presence of collaboration between Hellenic energy institutions.• Structuring of Hellenic institutions so as to consider multiple energy impacts (environmental, economic, etc.)• Renewable energy seen as an opportunity to solve energy, economic and social national problems (National economic recession and need to boost localeconomic development, offer an opportunity for renewable energy technologies).

• Provision of financial incentives to provide financial support to investors• Monitoring of the Hellenic Electricity Market that is supposed to take under consideration end-users' interests.• Initiatives by the State Electricity Utility (PPC), which start to be aligned with the national political agenda by building (or collaborating) on big REprojects.

• Efforts from the Government to approach local needs.• Organization of awareness campaigns from national institutions• Local institutions: efforts to train local people in authorization processes.

Between society–technology• European and national (mandatory) goals to increase renewable energy use in the national electricity generation mixes (EU Directive 2009/28/EC andHellenic NREAP).

• In Greece: variety of ideas and national efforts to disseminate knowledge on renewable energy.• Big investors are well in the game, even for “heavy” renewable energy technologies.• Private companies start investing on research.• Strong determination from private sector to invest on RE• Identification of proper local conditions (i.e. low cost of drilling for geothermal energy) for the exploitation of renewable energy technologies can boostrenewable energy development

Between society–technology• European institutions: financial protection and covering for boosting of research and innovations• National efforts to expand renewable energy for the so-called reasons of increase of energy sustainability and resulting in increasing electricity prices forthe end-user.

• National efforts to approach an integrated renewable energy system (including energy saving, etc.).• Quality certification processes are in place• National planning that tries to combine two renewable energy technologies and uses

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institutionalized conditions and prices. Still, consequences to the market and the public are not well identified. Results fromnational policies on energy saving are not available since they have not been published.

This inconsistency between governmental decisions and impact on the market becomes relevant when we think aboutinnovation: Hellenic institutions do not determine the way innovation and adoption of innovation in the energy sector unfold.The institutional environment neither promotes technological innovation nor results in increasing RES adoption [34–36]. Weconclude that the existing policy regime acts as a determinant and regulator of the market in a restrictive manner and does notallow any community-based innovation or any other market innovation to endure. In the last two years, institutional pressurefrom the Directive 2009/72/EC enhances the role of regulators for adapting institutions in such a way that they allow innovation.

This mismatch of institutional efforts with the energy market is evident when it comes to the ineffective and inefficientlicensing and planning procedures. Despite the favouring institutional environment for renewable energy projects, the licensingprocedure has always been complex andwith inconsistencies hence burdening investments [8,15]. For a decade a number of laws,joint ministerial decisions, circular decisions etc., were issued that constituted a complicated regulatory and legislationenvironment for RE deployment [20]. According to [20] the situation remains discouraging: “The Hellenic government recognizedthat the administrative and planning procedures remain complicated; the regulatory and legislation environment is extremelybureaucratic; thus restraining the sustainable development of renewable energy in the country” (translated in English bythe authors).

Insights into institutional operation are important for understanding how the energy sector evolved and how the energysector performs, we argue that investigating the relationship of energy institutions to society and technology can enhance ourunderstanding of the current lock-ins and ineffectiveness of the energy sector.

What is interesting in this research is that the PEST analysis revealed a number of pathologies that relate to all the three spaces.Weargue that these pathologies constitute the Energy Problem, and include among others: a) ineffective and inefficient licensingprocedures, b) time inefficiency across procedures (not only in licensing), c) institutional discontinuity regarding RE projects,d) non-compliance between institutional conditions, investing demand and existing energy infrastructures (or, the grid problem),e) inadequate communication between central authorities, developers and other stakeholders. Apart from understanding the EnergyProblem, and defining the elements of the Problem therein, it is important to investigate what lies beneath it.

We suggest that the above pathologies (Section 3.3) constituting the Energy Problem in Greece are the symptoms ofdisintegration between institutions, society and technology {See Definition Endnote}. Disintegration is thus the root cause of theenergy problem. The disintegration between interests and policies is manifested in the form of gaps between society andinstitutions, institutions and technology and society with technology. An overview of what underlines disintegration of theHellenic energy system is given in Table 2.

4. Toward closing the gaps

Disintegration means that efforts that focus on one of the interfaces only, further deepen the gaps and in turn, worsen thedisintegration and the energy sector's performance. Based on our findings, we suggest actions to be taken that target all interfacesand at the same time focusing on tightening the disintegration.

In this section we present some actions with a potential to integrate the aforementioned gaps. Our suggestions are notexhaustive but only indicative so as to achieve greater integration of society, institutions and technology. We want to proposepolicy actors to search for and include actions that target the disintegration problem that is the main impediment to asustainability transition in Greece. Future research and future policy efforts need to consider actions that can work at theinterfaces of society, institutions, and technology so as to strengthen the ties between society, institutions and technology.

4.1. On the gap between society and energy institutions

As seen when comparing Section 3.1, research from [15] with the PEST Analysis (Section 3.2), the gap between society andenergy institutions gets narrower. The PEST analysis shows the increasing institutional protection of end-users from nationalinstitutions such as the RAE and relevant institutional processes. The analysis revealed that efforts from the State to motivate andfinance investors especially when it comes to new RE technologies like PV are present. Nonetheless, disintegration is observedbetween society (societal demands, interests and perceptions) and energy institutions. [37,38] had been concerned about lack ofsupport for RES. In 2011, existing promotion policies do not apparently suffice to stimulate public interest. The opposition of localcommunities to RES is demonstrated in projects like geothermal or wind projects. This is surprising considering that publicconsultation and information are encouraged by current State's policies. We argue that what is really missing is the disseminationof full (and not dispatched) information for the citizens on the RE benefits. Among the RE benefits to be highlighted are thegrowth of the economic sectors and a reliable energy system as the most obvious [12].

Phenomena linked to blocking of RES installations can be seen as a sign that policy making in the RE electricity sector in Greeceshould not only include law-making and business-as-usual top-down process but to allow multiple interests to be heard(including the ones of developers, end-users, local authorities and local communities). [8] have also emphasized on the lack ofsocietal support for RES in Greece. Mechanisms to ensure local community engagement and capacity building of institutionsare needed.

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4.2. On the gap between society and renewable energy technology

There is a lack of transparency and visibility when it comes to innovation and pilot projects, and to problems of adaptation ofRET to the grid, etc.: this lack of transparency is not justified, since the European Commission has made available many tools andprocesses on pilot project funding and the dissemination of results (e.g. in the Intelligent Energy Program). This disseminationremains among decision makers, researchers or among investors and outcomes are not widely communicated to the broaderpublic. Some dissemination tools exist (such as campaigns and handbooks); but they are not adequate to ensure availability andtransparency of information.

When it comes to the reduced efficiency of the RET, we observe that the inappropriate design of RE appliances have resulted innegative effects not only from a technological point of view, with regards to people's negative opinion and lack of RET acceptance.

4.3. On the gap between institutions and RE technology

The disintegration between RET and energy institutions is expressed by the dominance of central planning paradigm forenergy projects that overlooks the opportunities of new RET to respond to local demands, the lack of integration between energy,economy and environment in practice, or the lack of institutional embracing of R&D.

Indeed, central planning philosophy seems still to be an important factor in halting the transition toward a sustainable energysystem, as the use of RET requires the design of decentralized energy system so as to fully exploit comparative advantages of RES[39]. Additionally, the grid is not adequately designed to host the two sources of electricity (from solid and RES) at the same time.Although there are actions toward incorporating and assessing energy policies toward environmental targets, results have notbeen yet published. Such actions include: (a) the Ministerial Decision (49828, 2464/2008) is the first legislative action that istaken toward integration of environmental measures with energy policy (b) the RE authorization procedures have passed to theMEECC in October 2009; indicating the recent political will to link RE targets with carbon emissions and national allocation plans(NAP), and (c) RAE is setting up methodologies of calculating carbon emissions coming up from energy fuels.

Even though obtaining of Environmental Terms is obligatory for a RES installation to proceed, there is not an environmentalmonitoring or assessment process after the installation of the RE project. RE projects have not been linked to the rest of economicsectors (e.g. food industry) which would allow their use based on specific economic needs in different regions and communities.This means that energy policies are not integrated with economic institutions. This monolithic focus on the energy sector and itsperformance, resulted in a disintegration of the RE sector with other sectors that are critical for the effective and efficient

Table 2Factors underlining disintegration gaps leading to a lagging energy transition in Greece.

Between society–institutions• Not adequate protection of end-users (structure of customer tariffs cross-subsidized between categories.• Lack of transparency (especially in the wholesale market) which creates business insecurity.• Lack of societal involvement and public participation in formulating energy policies.• Lack of mechanisms for community engagement in planning of RE plants• Authorization procedures block small investors.• Institutional discontinuities that block small investors.• Non-compliance between institutional conditions, investing demand and existing energy infrastructures.• High renewable energy cost for private sector to invest, not adequately met from national institutions.• Small, private investors face the lack of collaboration with the central authorities.• Not adequate central approach of local planning problems.• No monitoring process in place to follow (or assess and report on results of the national policy).

Between society–technology• Lack of visibility and information dissemination of successful RES-E pilots.• Reduced efficiency and production of RES-E due to improper design and/or unfit technology.• Dominance of one or two forms of renewable energy.• Inadequate sources of information (comprehensive information and assistance on the processing of authorization, certification and licensingapplications and on assistance to applicants for renewable energy generation is only available through public-state organizations such as RAE, theNational Transport System Operator and the MEECC).

• Willingness to pay (WTP) RE, but absence of specialized studies on assessing this WTP.• Local opposition against renewable energy projects mainly due to planning reasons.• Imports of RE technology that hamper the boost of the Hellenic innovation.• Inappropriate design of renewable energy technologies and adaptation to the Grid (non-adjustment of technology with Hellenic conditions).• Lack of transparency when it comes to research/innovation results.• Lack of transparency when it comes to the environmental impacts of heavy technologies.

Between institutions–technology• Dominance of centralized planning paradigm• In the Hellenic reality: lack of policy integration between energy, economy and environmental domains to ensure consistent RES-E projects evaluation• The use of small flexible systems (like small wind generators) is not widespread yet.• Lack of support of innovations

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operation and future development of the RE sector. Due to this disintegration, RE projects often show a non-compliance withenvironmental or societal criteria. Some suggestions toward integration are summarized in Table 3.

5. Discussion and conclusion

In the current paper we analyzed the historical and current developments and processes that form the energy system inGreece and based on this exploration we revealed what hampers the transition of the Hellenic energy system from a conventionalfuels energy system to a sustainable energy system.

Our multi-faceted analysis assesses energy governance in a more holistic way rather than focusing on one aspect(e.g. technology) and neglecting interdependent spaces. By taking a holistic view, our analysis shows the integrative nature of the‘energy problem’ and explains why monolithic treatments that have been in place already (see list of laws that have apolicy-focus) are sub-optimal and ineffective. We show that by taking a holistic view and a multi-faceted analysis, one can exposethe root cause of the problem rather than investigating its symptoms. We see the strength of our analysis residing in three points.First, we systematically analyzed and explored the Energy Problem in Greece.

The PEST analysis shows in a systematic way that the political, economic, social and technological spaces have interconnectedpathologies: a problem in one space snowballs and creates problems to the other spaces. The political space is settled with anumber of formal rules that provide a clear division of roles and responsibilities between the regulatory and monitoringauthorities for the energy market. However, law sets the boundaries, whereas policy is the implementation agenda for some ormore of the law. Hellenic Government seems to view both as the same (we note down different laws and then those are called“policy”), or if we put it another way, there are laws in Greece but there is not “policy”. The policy vacuum is thus the maininstitutional impediment as policy and law are different things with different roles: RE affairs comply with law; whereas deliveryof policy is characterized by non-existing monitoring and feedback to refine policy whilst maintaining the same law. Overall, itseems that there is one policy guideline and this summarizes to the policy ambition based on the assumption that the State canease investor's and end-users difficulties so as to achieve the 20–20–20 policy ambitions. The policy reality at present though doesnot confirm this assumption. Despite financial incentives undertaken, the economic space appears immature in seizing theopportunities laid for RE development from small investors. More specifically, only few investors (the “big” ones) take the chanceto put forward RE systems and to cope with financial hurdles, such as the hesitations from banks and financial institutions to fundRE projects due to uncertain economic environment in Greece. A similar situation is observed in the social space: despite theinstitutional reforms and plethora of laws, regulations, decisions and initiatives taken at a governmental level to further promoteRE use, those efforts have not yielded the expected results. Reluctance to fund or even accept RE means that local opposition isprudent. The technological space is particularly interesting: although the impact and appeal of technology are mainly discussedwhen it comes to RE penetration and development, technological innovation, research etc. are not yet sufficientlyinstitutionalized in Greece and RE equipment (except maybe from some photovoltaic systems) is neither designed nor producedbut only imported.

Table 3Recommended policy actions to integrate society, institutions and technology toward succeeding an energy transition to sustainable futures in Greece.

Recommendations to tighten the gaps

Integrating society and energy institutions– Ensure that national planning of energy feeding acquires features of openness. (A number of conditions contribute to an opening of a window ofopportunity for Greece to channel new business alternatives and exchange best practices with small investors from and outside Europe)

– Introduce and sustain sectoral integrated RE policies. (There is a great need for raising awareness of citizens by targeting into local needs and localindustries (i.e.: thematic local tourism development, energy peaks provoked by seasonal tourism).

– Standardize the protection of electricity consumer on the basis of sustainable development (What is of priority now is the protection of electricityend-users against tariffs increase, maintaining at the same time the reliability of the electricity generation, a process that has already started but has notbeen standardized yet).

Integrating society and energy technology– Moving away renewable energy (RE) cost from end-users (RE is more or less accepted now, in Greece, by the public which is now willing to pay for itsuse). Still, interest on renewable energy applications cannot only be based on governmental subsidization.

Integrating institutions and energy technology– Introduce standardization processes for energy planning (nowadays, maturity of the renewable energy market allows the standardization of processesand the dialogue between national authorities and end-users Further, RE processes should be transparent, discussable (between national authorities andend-users) and constantly questioned in public consultation processes)

– Updating the grid architecture toward cost efficiency and local needs satisfaction (The grid needs to be updated for improving its security and capacity.We also suggest energy policy makers to undertake a technology analysis study for exploring possibilities to increase outcomes from Grids at a locallevel.

– Ensure market openness and functionality for local energy investors primarily (there is now the need to make all market-related procedures andprocesses more and more safe and reliable for EU developers (in both technological – renewable energy credibility – and financial terms). Especially forGreece, due to National Allocation Plan (NAP) and the obligation of Greece to internalize CO2 cost in the electricity production cost calculation,technologies that contribute to the scaling down of CO2 emissions may be preferred. In relation to this, it may become feasible for renewable energytechnologies with a low CO2 cost to be promoted and funded by local investors. Mobilizing local investors should be one of the State's first priorities).

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Having considered sustainable energy as one of potential leverage for boosting Hellenic economy and using as an example therenewable energy system, we have observed that the problem lies at the interfaces between the three crucial aspects that definethe energy context: Institutions, Society and Technology. We have indicated disintegration as the root causing the EnergyProblem. The unravelling of disintegration as the root cause is the second strong point of our analysis.

Where does disintegration lie? The lack of mechanisms for community engagement and the lack of local capacity building forpolicy formulation create the disintegration gap between society and institutions. Such misalignments may be resolved with anintegration of social interests and demands to institutional operation and with an integration of RES to local context (includingsocial demands, and environmental conditions). Institutional conditions that respond to energy market need to comply withpolicy in other sectors that influence energy planning, such as spatial planning and environmental policy. We suggest institutionsto create conditions for more active involvement of communities in energy policy via openness and policies that will protect theelectricity consumer; so as to create trust and interest for engaging in policy processes.

The lack of transparency and availability of information about successful RE projects, and the reduced efficiency andproductivity of some RET due to improper design or unfit technology explains the disintegration gap between energy technologyand society. When society opposes RE installations fearing for environmental degradation, information of successful REimplementation is unavailable. The non-visibility and unavailability of information about well-performing RE projects make everyRE project a green-field project. We suggest an active role of scientists so as to create an active science–society dialogue and toprovide scientifically reliable information to citizens about the benefits and the risks of RE.

The gap between institutions and technology is constituted by (a) the lack of integration between institutional, economicaland environmental impacts when assessing RE projects. This results in incompliant RE projects on environmental or socialcriteria, (b) the lack of specialized training on new RE technologies, and (c) the dominance of central planning paradigm whereenergy policy decided at a national level assigns roles and responsibilities at regional and local levels. These issues create in turnan unfavourable environment for technological innovations (e.g. hybrids or micro-RES) and sclerotic institutions at a nationallevel without reflexes for local-level demands and innovations. We suggest introducing standardization processes for energyplanning, allowing policy and technology transfer for updating the grid architecture and market openness to local energyinvestors so as to tighten the technology–institutions disintegration gap.

The Hellenic energy system embodies disintegration between interests and policies (of different sectors) that is manifested ingaps between institutions, society and technology. The unveiling of the gaps is the third strong point of our analysis.

In practice, disintegration means that policy efforts that focus on one of the interfaces alone, further deepen the gaps and inturn, worsen the disintegration and the energy sector's performance. In this vein, our analysis shows that the current way ofstrengthening energy institutions, results only on privileging big investors. In order to privilege small developers as well, effortsneed to be placed for strengthening institutions, society and energy technology as well as their ties for good energy governance[40]. RES are not adjusted to local demands making fitness of existing RETs problematic. This marginalizes the benefits of RES forboth the energy sector and the local and national economies.

Disintegration is thus understood as a persistent problem created by past decisions and investments and further reinforced bysegmented efforts (policies and investments). As a persistent problem it requires radical redefinitions of actions and processesthat will form a new institutional, social and technological landscape that will enable a transition to a sustainable energy system[41,42].

Based on our findings, we suggest actions that target all interfaces and at the same time focus on tightening the gaps. Theactions are neither exhaustive nor panaceas to the disintegration. They are indicative suggestions that can be included in the(existing) energy policy mix and they work at the interfaces of society, institutions, and technology. We want to highlight thatpolicies should be simple to be laid down and acted upon where the system starts to degrade. In the same vein, even a simpleaction is doomed without orchestrated efforts between national and local authorities and political commitment.

In our analysis we identified inefficient and ineffective policies and institutions. We do not disregard the importance of policiesand institutions for the operation of the energy system. We simply suggest that future governance schemes could take a moreholistic approach when assessing expected impacts and could aim at integrating opportunities and potential in (existing)institutions, society and energy technology to overcome the existing gridlock. This may make the difference between movingforward to a more sustainable future or slowing down RE implementation and failing to meet the Hellenic 20–20–20 targets.

AbbreviationsCRES Centre for Renewable Energy SystemsETA Environmental Terms ApprovalEU European UnionGHG GreenHouseGas EmissionsHTSO Grid OperatorMEECC Ministry for the Environment, Energy and Climate ChangeNAP National Allocation PlanNGO Non Governmental OrganizationPPC Public Power CorporationPV PhotovoltaicRAE Regulatory Authority for EnergyRE Renewable Energy

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RES Renewable Energy SystemRET Renewable Energy Technology

Acknowledgments

Authors would like to thank Dr. A. Michopoulos and Dr. J. Hills for their useful feedback and comments in past versions of thepaper and especially Dr. J. Hills for proof-reading. We would also like to thank Professor Wil Thissen and Dr. Els van Daalen fortheir feedback in earlier versions of our analysis. The two anonymous reviewers also guided us to an improved and sharperanalysis that we hope to benefit the audience of the journal.

Definition Endnote:We agree and adopt the definition of policy integration of OECD (2006; cited by [43] p.4044) “The institutions and processes

facilitate decision making by explicitly, clearly and fairly balancing trade-offs. In particular, they integrate and considerperspectives of different scales related to both the global public good of GHG reduction and the local public good of environmentalconservation and protection. While striving for this balance, they operate efficiently and within the capacity of administrativeagencies, allowing for thorough decision making without unnecessarily wasting time or resources”.

Appendix A

Table A.1Interviews for the Hellenic energy transition case (additional to [42]).

The following actors have been interviewed with a semi-structured in person interview and provided the field data for our research on RES transition inGreece.

Interviewee Position Date and place of Interview

NGO representative Greenpeace Greece 11-October-2007, BrusselsEnergy policy advisor Energy Planning Division, Ministry of Development, Greece 28-January-2008, BrusselsEnergy policy advisor Legislation Enforcement Group, Ministry of Development, Greece 28-January-2008, BrusselsEnergy policy advisor for islands DG Energy, EU 29-January-2008, BrusselsPolicy researcher Technical University of Crete 29-January-2008, BrusselsEnergy planner Energy Agency of Cyclades 30-January-2008, BrusselsEnergy researcher University of Thessaly 12-December-2009, ThessalonikiEnergy researcher Aristotle University of Thessaloniki 23-March-2011, AthensEnergy researcher Aristotle University of Thessaloniki 21-June-2011, ThessalonikiEnergy researcher University of Thessaly 20-September-2011, consultation via e-mailEnergy researcher University of Patras 22-September-2011, consultation via e-mailEnergy advisor NGO Heraklion, Crete 10-September-2011, Heraklion, Crete

Table A.2Key determinants of the institutional evolution of the Hellenic energy sector [15] [42].

Year National/European decision — measure

1889 Introduction of electricity in Greece. The General Contracting Company electrified Athens and a Belgian Company (commissioned by the Turkishauthorities) electrified Thessalonica.

1899 Multinational electricity companies enter the electricity market. A consortium of an American company with the National Bank of Greeceundertook the electricity supply of major Hellenic cities.

1929 Local authorities undertake the task to electrify the most remote areas. 250 cities (population>5000 capita) were supplied with electrical power.1950 400 companies involved in the generation of electricity, constituting a fragmented power generation. Importing of fuel resulted in very high

electricity prices, while supplied only specific hours during the day and sudden power outages were quite common.1950 Presence of different demands due to the development of rural areas and industrial sector: (a) uniform electrification of the country; (b)

Exploitation of domestic resources (lignite and hydropower) at the minimum cost; (c) Need for the allocation of loads into a singleinterconnected system.

1950 Foundation of the Public Power Corporation (PPC) in favour of “the interests of the public”.1956 Dominance of the PPC as the only provider of electricity and gradual merge of all the existing companies.

Development of the PPC into one of the bigger heavy industries of the country and achievement of the country's energy autonomy (even in themost remote areas).

1985 GR Law 1559/1985 "Regulation of issues of alternative forms of energy and specific issues of power production from conventional fuels and otherprovisions" (OG A 135): first integration of RES in the Hellenic electricity system by the PPC. A total of 24 MW was installed whereas localgovernment organizations have contributed to a level of 3 MW until 1995 and the private sector was left out of the scene entirely.

1990 GR Law 1892/1990: public funding for the RES projects by the Ministry of National Economy.

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Table A.2 (continued)

Year National/European decision — measure

1994 GR Law 2244/1994 “Regulation of power generation issues from renewable energy sources and conventional fuels and other provisions” (OG A 168):sale rates for renewable energy are fixed (interconnected system: 0.07287 Euro/kWh; non-interconnected system: 0.08458 Euro/kWh). It ismade obligatory for the PPC to buy that energy.

1994 1994–1999 OPE Program I: public funding of private investments on RES initiated by the Ministry of Development (Agoris et al., 2004)1998 GR Law 2601/1998 on incentives for private investments, economic growth and regional convergence (and since 2004 Law 3299/2004):

Public funding for RES projects depending on its location by the Ministry of National Economy.1999 GR Law 2773/1999 “Liberalisation of the Electricity Market-Regulation of energy policy issues and other provisions” (OG A 286): implementation

of the Directive 96/92/EC for the liberalization of the electricity market. Key points: (a) favorable pricing regime for RES, (b) priority access of RESto the grid, (c) benefit of 2% of municipalities from investments on RES in their region.

1999 Fierce objections from local communities were experienced in regions of highly favourable wind potential against the installation of wind parks.1999 GR Law 2742/1999: first national spatial planning law where RES advantages are addressed.2000 Foundation of the Regulatory Authority for Energy (RAE) and the System Operator (DESMIE) in response to the Law 2773/1999: a) RAE is an

independent public authority entrusted with the task of monitoring and controlling the liberalization of the electricity market. b) The SO(Presidential Decree 328/2000) has as a task the operation, maintenance and development of the electric power transmission system of thecountry.

2000 2000–2006 The Operational Programme “Competitiveness” (OPC): funding from the 3rd Community Support Framework (2000–2006) for RESand energy saving, substitution and other energy-related actions as high as Euro 1.02 billion. (Hellenic Ministry of Development, 2005)

2001 EC Directive 2001/77/EC: introduction of guidelines and indicative targets for the introduction of RES in EU states. An indicative target for Greeceto cover a part of its gross national electricity consumption by 2010 from renewable energy sources (RES) equal to 20.1%, with the contribution oflarge-scale hydroelectric plants included (Hellenic Ministry of Development, 2005)

2001 Reformation of the PPC into a “Societe Anonyme” in response to the 2773/99 and the Presidential Decree 333/2000. The deregulation of theelectricity market actually started in February 2001.

2001 GR Law 2941/2001: guidelines for the RES installation in forests and scrublands with special provisions.2001 Riots and reactions of PPC's employees associations against the deregulation actions. Fear of loss of working places as a motive of such riots.2002 New organization practices within RAE: appointment of RAE's Secretariat with meritocracy criteria and transparent procedures. The majority of

the rest were academics or executives from the private sector of Greece and abroad from whom only two were ex-administrators of the PublicPower Corporation.

2002 2002–2006 Operational Program for Energy II: public funding for RES from the Ministry of Development and the 2nd Community SupportFramework (CFS). The 30% of 42 RES projects of a productive capacity of 576.000 GWh were submitted for financing (Hellenic Ministry ofDevelopment, 2005)

2003 EC Directive 2003/54/EC: amending directive to the Directive 96/92/EC for the acceleration of the electricity market liberalization.2003 GR Law 3175/2003: establishment of a comprehensive set of rules for the rational use of geothermal energy. Law equally necessary to reflect the

modifications made by Directive 2003/54/EC.2003 GR Ministerial Decision 1726/2003: licensing process of RES facilities to be adapted to the environmental permitting.2003 Implementation of the Law 2742/1999 in form of the Regional Frameworks for Spatial and Sustainable Development Plans2004 Supreme Administrative Court (SAC) ruling 2569/2004: a wind park installation's restriction due to improper sitting.2006 GR Law 3522/2006: tax deduction scheme that considers all small domestic RES systems to be eligible for a 20% tax deduction capped at € 700 per

system.2006 GR Law 3468/2006: law necessary for the further integration of RES into the national energy balance by simplifying administrative and financing

procedures (mostly regarding to photovoltaic issues), by regulating issues regarding hybrid projects and geothermy, biofuels, etc.)2006 GR Ministerial Decision (Ministry of Development) D6/F1/4754/9.3.2006: call for expression of interest on investing in RES in the islands of

Kefalonia, Zakynthos, Levkas and Ithaka, for the purpose of covering an existing generation capacity margin of 30 MW.2007 Launching at a public consultation (February 2007) of a draft Law for the Spatial Planning of the RES projects.2008 GR Ministerial Decision 49828, 2464/2008: framework for the Spatial Planning and Sustainable Development for Renewable Energy Projects and

the Strategic Environmental Assessment of the Renewable Energy Projects. The SPPF-RES sets out Physical Planning policies for RES per categoryof activity and location for the first time in Greece aiming at prioritizing the utilization of RES over other land uses and facilitating theenvironmental permitting of RES projects all over Greece. It provides for specific steps for applications that concern land use, among others, inareas characterized as forests or scrublands, high productivity cultivation areas, areas neighboring to sensitive/special facilities or restricted areas(airports, military stations), wildlife areas/NATURA areas, and sites of archaeological interest including the specification of exclusion zones.Especially for the wind energy, quantitative requirements for maximum coverage per municipality area are set, while three (3) regions wereidentified and characterized as priority areas for wind energy development.

2008 2008 National Campaign for the promotion of RES (guidebooks for assessment, evaluation, environmental impact and installation procedure forall different RES technologies)

2009 GR Law 3734/2009 “Promotion of co-generation of two or more energy sources, regulation of issues related to Mesochora hydroelectric plant andother provisions”: this law complies with the Directive 2004/8/EC on cogeneration. The law replaces some articles of the 3468/2006 aiming atfacilitating some the integration of some renewable energy technologies (especially PV). Specific regulations are provided for PV pricing, theSystem Operator and the Centre of Renewable Energy Sources. L3734/2009 constitutes the main legislative instrument for the transposition inthe Hellenic legislation of Directive 2004/8/EC concerning the promotion of cogeneration and aims to provide a significant stimulus for CHPinstallations in Greece and to tackle barriers for this type of installations. More specifically, this law specifies in detail the licensing procedure ofCHP plants, the related guarantees of origin, as well as a series of other issues that acted as barriers related to the promotion of RES in the Hellenicenergy market.

2009 EU Directive 2009/28/EC of the European Parliament and the Council of 23 April 2009 on the promotion of the use of energy from renewablesources and amending and subsequently repealing Directives 2001/77/EC and 2003/30/EC: greenhouse gas emissions must be reduced by at least20% in 2020 in comparison to their 1990 levels and supply 20% of energy needs by 2020 from renewable energy sources (RES), including the useof 10% renewable energy in transport. For Greece, in accordance with national objectives, the share of RES in gross electricity consumption shouldrise up to 20.1% in 2010 and to 29% by 2020

2009 EU Directive 2009/72/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market inelectricity and repealing Directive 2003/54/EC: this Directive asks for the enhancement of the role of Energy Regulators and the independence ofElectricity Transport System Operators so as the European electricity markets are further liberalized.

(continued on next page)

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Table A.2 (continued)

Year National/European decision — measure

2009 Special Programme for the deployment of Photovoltaic systems up to 10 kW on buildings and especially on roofs(OG B′ 1079/4.6.2009)2009 GR Law 29116/7.7.2009 (T.A.A.Y.P. issue 344 B′): framework for the installation of PVs on buildings and open yards (GR Ministerial Decisions

16094/8.4.2008, 16095/8.4.2008 and 29107/7.7.2009) & Framework for the installation of PVs beyond limits of existing zoning plans2010 GR Law 3851/2010: law aiming at a) implementing mandatory targets for renewable energy sources into the Hellenic energy mix: 20% from RES

into the energy mix, 40% from RES into the overall electricity production, 20% from RES into heating and cooling, 10% from RES into transports, b)Coverage of total primary energy consumption with energy providing systems based on RES, CHP, district heating on a large area scale/block scaleas well as heat-pumps for all new buildings by 31.12.2019 and for all new public buildings by 31.12.2014, c) Tendering procedure for theconstruction and operation of off shore wind farms

2010 GR Ministerial Decision (FEK 2143. 31/12/2010): adaptation of Ministerial Decision D6/F1/οικ. 8684/24.4.2007 (Β 694) about the possibility ofdevelopment of PV systems up to 150 kWp in islands connected to the grid.

2010–2016

Application and reinforcement of the National Transmission Development Plan (NTDP), elaborated by the System Operator: a) upgrading of gridinterconnections in the mainland, b) interconnection of the non-interconnected islands according to strategic planning elaborated by the SystemOperator (expected increase: 4.500 MW)

2010 Reinforcement of the interconnection capacity with neighboring countries Further actions and projects for the integration of the electricitysystem into the European grid through western Balkans (Program time run 2010–2018)

2010 Development of storage facilities in the interconnected system by exploiting hydro pumping system at existing large hydro plants and newinstallations (Program time run 2010–2020)

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Dr. Evanthie Michalena has been working in the energy sector for the last 19 years, presently as a Special Advisor in the Regulatory Authority for Energy, Greeceand a Researcher in the ENEC Laboratory of the Sorbonne University and CRNS (France). She has participated in numerous research projects, has recorded 12publications in peer-reviewed journals and 36 presentations in international conferences and she is an invited lecturer at two Universities. She has undertakenseveral consulting missions for private companies and the European Commission, being invited to support at the evaluation of European projects and training ofnational authorities in 15 countries.

Dr. Niki Frantzeskaki was born in Chania, Greece in 1980. She graduated Environmental Engineering with the Technical University of Crete, Greece in 2003. Sheearned an MSc in Engineering and Policy Analysis in 2005 and her PhD on Dynamics of Societal Transitions in 2011 both from Delft University of Technology, theNetherlands. Since April 2010, she works with the Dutch Research Institute for Transitions (DRIFT), Erasmus University Rotterdam, the Netherlands focusing oninstitutions and policy transitions. From November 2011 to June 2012, Niki is a Visiting scholar with Monash University Melbourne at the Centre for WaterSensitive Cities, Australia. Her research interests the intersection of institutions and policy dynamics for energy and water infrastructure systems.

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