Shareholders in Greece's PPC agree new tariffs with client Aluminium

<p>Greece's main power utility PPC secured shareholder approval on Wednesday of tariffs the company will charge its biggest client Aluminium of Greece, concluding two years of negotiations between the two companies over power supply prices.</p> <p>PPC, which is 51 percent owned by the state, and aluminium producer Aluminium, owned by energy group Mytilineos, have been embroiled in a decade-long standoff over charges. An arbitration court settled the issue for the 2010-2013 period and the two sides have been in talks since 2014 to bridge their differences by themselves.</p> <p>Agreeing new cost-based electricity tariffs that PPC charges to the country's biggest industries is part of a set of reforms Greece has to conclude to secure fresh loans later this month.</p> <p>The new tariff contract PPC's shareholders approved on Wednesday offers Aluminium a 33 percent discount over tariffs charged to big industries.</p> <p>PPC will offer an additional discount of 15 percent, and in turn Aluminium will pay 100 million euros as a downpayment for power supplies by mid 2017 and an advance payment of 30 percent of the total charges for power supplies by 2020.</p> <p>{googleAdsense}</p> <p>"I hope that Aluminium of Greece will take advantage of the undisputable benefits of the agreement, helping (the country's) growth and the creation of new jobs," PPC's chairman Manolis Panagiotakis said in a statement.</p> <p>Mytilineos also welcomed the development, saying it marks a new chapter in its relations with PPC, and announced it will immediately sign the new contract.</p> <p>PPC's profitability has been seriously hit by overdue bills in recent years as many Greeks struggle to pay their electricity bills after seven years of an austerity-induced recession.</p> <p>Analysts said the new contract will eat into PPC's profit but will boost its cash flow, retaining a big client with a unique consumption profile.</p> <p>Shares in PPC rose 1 percent on Wednesday, outperforming Athens bourse's general index which shed 0.4 percent.</p> <p>Under its latest international bailout, Greece has to open up its electricity market and reduce PPC's market share to below 50 percent by 2020 from a present level of about 90 percent.</p> <p>Aluminium is PPC's biggest client, consuming some 2.8 million megawatts a year.</p>