* Greece to sell 66 percent of grid operator ADMIE
* Athens needs investor to spend 2.5 bln eur on grid
* Most Greek islands lack power connection to mainland
ATHENS, Feb 6 The Greek parliament approved
legislation on Thursday to privatise its electricity grid,
seeking to attract investment and secure the energy supply of
tourist destinations such as Santorini and Crete.
The law allows potential investors to buy a 66 percent stake
of grid operator ADMIE, which runs about 11,000 kilometres
(7,000 miles) of high-voltage power lines across the country.
The ADMIE sale is not part of Greece's obligations towards
its international creditors under the terms of its 240 billion
euro ($325 billion) bailout. But it is necessary to comply with
European Union energy laws that say grid operators must be
separate, stand-alone entities.
Energy Minister Yannis Maniatis told lawmakers the nation
can't afford to invest the 2.5 billion euros it needs to extend
the grid to the islands and lay new connections to neighbouring
countries such as Italy.
Because they lack connections to the grid, islands such as
Santorini depend on polluting, blackout-prone, oil-fired power
stations to provide electricity to millions of tourists each
summer. Tourism generates about 15 percent of Greek economic
"We are spending 1 billion euros ($1.35 billion) a year on
diesel and heavy oil to burn on the islands each year," Maniatis
New power links would also allow Greece to boost renewable
energy production on its sun-baked, windswept islands and
possibly export it to other countries.
But Greece's opposition and labour unions oppose the grid
sale, fearing it is a precursor to fully privatise
state-controlled power producer PPC, which currently
owns 100 percent of ADMIE. The main opposition Syriza party
pledged to reverse the sale, if it comes to power.
ADMIE's sale is expected to take place later this year. The
Greek government will not obtain any money from it because all
its proceeds will go to PPC.
ADMIE's buyer will run a regulated business with a fixed
rate of return to recoup its investment. PPC has yet to value
the stake. Greece late last year agreed to sell its natural gas
grid operator DESFA on similar terms to Azeri company SOCAR for
400 million euros.
($1 = 0.7390 euros)
(Reporting by Harry Papachristou; Editing by Ruth Pitchford)