Greece introduces new energy requirements for data centre investments

The draft legislation, introduced by the Ministry of Environment and Energy to transpose Directive (EU) 2024/1711, establishes a new framework for the connection and operation of data centres, shifting a significant proportion of the costs associated with the necessary energy infrastructure onto investors themselves.

The new provisions are primarily set out in Articles 19 to 28 and will directly affect the financial assessment, site selection and implementation timelines of planned investments.

Annual Levy of Up to €1.5 Million for a 100 MW Facility

Article 27 provides for the introduction of a special annual levy of €15,000 per MW of maximum electricity consumption capacity. This translates into an annual charge of €750,000 for a 50 MW data centre and €1.5 million for a 100 MW facility.

The levy becomes payable from the commencement of operations and is allocated for the benefit of residential electricity consumers and the municipalities hosting the facilities.

The charge is particularly significant for investors, as it represents a recurring operating expense, independent of the cost of purchasing electricity.

Mandatory Link to New Renewable Energy Generation

The most significant change concerns the requirement for at least 60% of a data centre’s total annual electricity consumption to be covered by new Renewable Energy Sources (RES) facilities.

The RES facilities must meet specific criteria regarding new generation capacity and must become operational no later than the date on which the data centre is energised. Otherwise, the facility’s electricity supply will be suspended until the relevant energy installations have been completed.

This obligation may be fulfilled through direct connections to renewable energy and storage facilities, bilateral power purchase agreements (PPAs) involving either physical delivery or financial settlement, as well as eligible self-consumption arrangements.

At the same time, the legislation provides for the possibility of reducing the 60% threshold through a ministerial decision where technologies other than photovoltaics are used or where renewable energy installations are combined with energy storage systems.

The provision is expected to stimulate demand for new green energy projects supported by long-term power purchase agreements, creating opportunities for partnerships between energy groups and digital infrastructure developers.

Investors to Bear the Cost of Grid Infrastructure

In addition to the special levy and renewable energy requirements, the draft legislation introduces significant financial obligations relating to grid connections.

Under Article 26, data centre operators will be responsible for the full actual cost of connection, including the cost of the infrastructure they use, subject to the specific conditions set out in the provision.

Any grid expansion or reinforcement works required exclusively to connect a data centre will be borne entirely by the investor.

This provision is particularly relevant in areas where available electricity capacity is limited and new substations or other grid extensions are required.

Bank Guarantees of €200,000 per MW

The new framework also requires investors to submit a bank guarantee of €200,000 per MW of maximum electricity consumption capacity.

For a 20 MW project, the required guarantee amounts to €4 million, while a 50 MW facility would require a guarantee of €10 million.

The guarantee is reduced by 25% upon the signing of the Connection Agreement, with further reductions предусмотрed in cases of phased energisation. The amount is refunded once the electrification process has been completed for the facility’s entire maximum consumption capacity, subject to the conditions stipulated by law.

This requirement increases investors’ financial support and liquidity needs while serving as a mechanism to discourage the reservation of electricity capacity by projects that have not reached an adequate level of maturity.

Priority Access for Large-Scale Data Centres Above 200 MW

The draft legislation includes a specific provision for particularly large-scale investments. Connection applications for data centres with a maximum electricity consumption capacity exceeding 200 MW may be examined under absolute priority, provided they are accompanied by a commitment to develop new dispatchable generation capacity and/or energy storage systems.

The relevant capacity must cover at least 80% of the data centre’s maximum electricity consumption capacity. Additional requirements also apply regarding storage capacity and the operating duration of the relevant installations.

The new provisions are set to significantly reshape site-selection criteria for data centre developments in Greece. Proximity to suitable energy infrastructure, available electricity capacity, connection costs and the ability to secure new renewable energy generation will now play a decisive role in determining the viability and location of planned investments.