Αποτελέσματα Δημόσιας Διαβούλευσης επί του Κανονισμού Τιμολόγησης, του Κώδικα Κατανομής Χωρητικότητας και των κατευθυντηρίων οδηγιών για δημόσιες διεθ

(2)(βα) (price-only / quality-only / combined, with transparent handling of deliverability). CCS legislative framework in Greece Review of draft secondary legislation 8 Executive summary ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 B

1. IESC basis, injection profile and confidence ranges should be transparent The Code fixes IESC at 2.8 MTPA by reference to the permit and supporting technical documentation. Given IESC’s centrality to tranche volumes, contracting and investment decisions, stakeholders need access (at least at summary level) to the independent expert basis and key assumptions, including the implied injection profile / operating period and any confidence-range framing (eg central vs downside case). This supports confidence in the tranche design and reduces the risk that later revisions lead to contentious reallocations. B
2. Capacity revisions and “undisposed” versus “new” capacity need predictable routing rules The Code provides proportional reductions if capacity is revised down and routes capacity above IESC to short-term contracts as “New Storage Capacity.” Predictability would improve materially if the package clarified: ● The operational triggers and sequencing for when capacity is deemed “undisposed” (eg undersubscription, non-contracting, fall-away after revision) and how it is re-offered; ● The distinction between “undisposed IESC capacity” (which should be reoffered consistently with tranche logic) and “New Storage Capacity” (capacity above IESC), to avoid concerns about implicit withholding; and ● How standard terms implement proportional reductions in practice across routes (sequencing, notices, treatment of associated obligations). B
3. DNSH constraint is material and needs operational guidance The Code introduces a system-level Do No Significant Harm (DNSH) constraint that materially affects allocable capacity. Because applicants’ prospects depend on DNSH treatment, early publication of interpretative guidance or worked examples would reduce uncertainty, and the Code would benefit from clarifying how the DNSH cap is operationalised across channels (eg channel-level caps or system-level routing). B
4. Regulated access eligibility and oversubscription: the “eligible set” gate is the key determinant Equal sharing among eligible users (as required by the CCS Law) is predictable only if the eligibility gate is sufficiently selective when interest exceeds the regulated tranche. The Code defers important elements to invitations. To reduce dispute risk, the Code (or invitations constrained by Code-level principles) should implement objective screening around deliverability / maturity, emissions impact, and (as appropriate) hard-to-abate considerations treated as an evidence-based abatement case rather than a sector label. Documentary requirements should also better reflect deliverability (including injection / booking profiles with ramp-up assumptions) and clarify where transport readiness is assessed. CCS legislative framework in Greece Review of draft secondary legislation 9 Executive summary ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 B
5. Contract tenor, ramp-up / ramp-down, non-use and recycling should be coherent with the Tariff Methodology and Market Test Guidelines A recurring package issue is the relationship between: ● operating period / injection profile underpinning IESC; ● contract tenors offered under regulated and competitive routes; ● ramp-up / ramp-down treatment; and ● store-or-pay and any capacity recycling rules. These must be handled coherently across the Code, standard terms and the Tariff Methodology’s NPV volume concepts. Unclear or inconsistent treatment will impair bankability and create equal treatment concerns. B
6. Transfers and guarantees need clear ‘chain’ rules in standard terms The Code permits transfers, but it does not yet specify how guarantees and liability move with capacity. The standard terms should define the ‘credit chain:’ who posts the guarantee at each stage of a transfer, whether the original holder retains liability, when guarantees are released, and how forfeiture works, especially where an entity participates across regulated and competitive routes. C. Market Test Guidelines: key issues and why they matter C
7. The JDA “Structured Cooperation” step operates as a gateway and must be constrained The Market Test Guidelines mirror the two-stage market test structure but add a substantive “Structured Cooperation” step under a Joint Development Agreement (JDA), and treat JDA execution as a prerequisite to Stage
8. Coordination can be sensible in CCS, but once it functions as a gateway to bidding, the framework must ensure it cannot become a discretionary filter. Minimum safeguards should be anchored publicly: objective readiness criteria, consistent application, reasons for refusal, complaints coverage, and clear limits on discretion. Critically, the JDA should not introduce new eligibility criteria beyond the publicly approved framework. C
9. Evaluation architecture must be visible ex-ante, not deferred to the Stage 2 Notice The competitive tranche must be awarded under one of the three CCS Law Article 27

(2)(βα) models (price-only, quality-only, combined). The Market Test Guidelines currently rely heavily on the Stage 2 Notice for determinative rules. For predictability and equal treatment, the Market Test Guidelines should anchor the evaluation architecture at consultation stage, including: CCS legislative framework in Greece Review of draft secondary legislation 10 Executive summary ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 ● admissibility thresholds; ● the ranking determinant(s) under the chosen model; ● how deliverability is protected (pass/fail gates and/or scoring with weights); and ● tie-break rules. Participants cannot prepare credible bids and evidence packages without knowing the evaluation logic. C

1. Sequencing with regulated access is insufficiently specified and is central to behaviour and fairness Because the Code links regulated contract signing windows to completion of the competitive procedure, the end-to-end sequencing between routes is outcome-shaping. The Market Test Guidelines defer key sequencing logic to stage notices. The package should state, at principle level, whether: ● regulated outcomes are finalised and published before Stage 2 bids; ● what capacity-by-route information is published at each step; ● how double counting is avoided where a party participates in both routes (netting / conditionality); and ● the integrated milestone sequence through to contracting. Without this, participants may be asked to submit binding bids and guarantees without knowing their regulated allocation position, distorting bidding strategies and raising equal treatment concerns. C
2. Storage Management Code confidentiality is difficult to reconcile with its outcome relevance The Market Test Guidelines treat the Storage Management Code as a secure data room document accessed after JDA execution, yet it is described as defining operational rules and service parameters, and it is central to interface alignment. A document that materially affects user rights / obligations and access outcomes should not remain non-public by default. The package should align confidentiality treatment with publication / issuance expectations, and clearly distinguish interim interface requirements used for bidding from the final code issued / published under the law. C
3. EVA governance and re-runs must be bounded and aligned with the tariff framework The Market Test Guidelines include an Economic Viability Assessment (EVA) after evaluation, with potential investigation of alternative technical solutions and tariff recalculation, and CCS legislative framework in Greece Review of draft secondary legislation 11 Executive summary ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 possible re-application of steps. This is determinative and must be bounded: which inputs are fixed at bid time; what can change; what approvals are required; what disclosure is made to participants; and how acceptance and any re-run is handled. This needs clear linkage to the Tariff Methodology approach to pre-FID tariffs and governance of recalculations. C
4. Reallocation after failure to contract must follow published routing rules If a party fails to execute the Storage Agreement or maintain guarantees, the Market Test Guidelines contemplate reallocation “in accordance with published rules.” Those rules need to be identifiable ex-ante and consistent with Code routing (eg next-ranked within-round reallocation versus re-offering as undisposed capacity under a subsequent procedure). Absent published routing rules and triggers, reallocation risks discretionary outcomes. C
5. Governance and approvals should be explicit The Market Test Guidelines should make visible where RAAEY approvals apply (stage notices, competition documents, EVA-related recalculations and re-runs, and allocation outcome governance), and ensure complaints coverage explicitly includes the JDA gateway and EVA decisions. Visible governance is not formality: it reduces discretion, supports auditability and improves investor and user confidence. D. Priority actions to move from consultation drafts to a coherent, implementable regime Across all three instruments, the most material improvements are structural and packagewide:
6. Fix the documentary hierarchy: outcome-determinative rules should be anchored in publicly approved instruments; notices and standard terms should implement, not redefine, core rules.
7. Clarify capacity concepts and volume drivers: align IESC, System Capacity and booked / utilised measures across the Code and Tariff Methodology, and ensure ramp-up / ramp-down are handled through booking profiles and standard terms.
8. Make sequencing and publication logic explicit across regulated and competitive routes, given the Code linkage of contracting windows to the competitive procedure.
9. Publish evaluation architecture ex-ante for the competitive tranche (CCS Law Article 27

(2)(βα) model, thresholds, scoring / ranking, weights, tie-breaks). 5. Constrain the JDA gateway with objective readiness criteria, reasons, complaints coverage, and limits on discretion. 6. Bound EVA recalculation governance and align it with the Tariff Methodology and approval points. CCS legislative framework in Greece Review of draft secondary legislation 12 Executive summary 7. ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 Strengthen tariff governance (cost taxonomy, pass-through discipline, prudence/efficiency tests, regulatory accounts and audit, CAPM-consistent WACC, symmetric re-openers). Section 2.8 provides a practical set of drafting directions to support this work. Given the compressed consultation timetable and the structural nature of the deficiencies, we do not consider these issues solvable through ‘quick fixes.’ We therefore recommend that finalisation proceeds via a structured working group approach involving the CCS Authority, RAAEY, the operator and market participants, to co-develop coherent final instruments, associated notices and the standard contract suite, with transparent resolution of the key design choices and clear accountability for approvals and implementation. CCS legislative framework in Greece Review of draft secondary legislation 13 Introduction 1 ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 Introduction This document sets out our review of the secondary regulatory instruments consulted for the Prinos CO2 storage site: the Tariff Methodology, the Capacity Allocation Code, and the Market Test Notice & Guidelines. Our review is not a legal opinion and does not assess the legality of the instruments or their consistency with higher ranking law beyond identifying where drafting choices create material uncertainty, procedural discretion, or implementation risk. The document reflects our independent views. It has been developed in consultation with interested emitters, but it does not necessarily reflect their positions on all issues and should not be read as binding or as a statement of any party’s agreed stance. For the purposes of this review, we take the carbon, capture and storage (CCS) Law framework as given, including the regulated nature of the storage service, the use of a public international competitive procedure for the auctioned share, and the tranche architecture (including the equal splitting concept within the regulated access route). We note that both we and market participants have reservations about aspects of the fundamental design; however, the focus of this note is not to reopen those policy choices but to assess whether the consulted instruments operationalise them in a coherent, predictable and nondiscriminatory way. Our core lens is ‘package coherence:’ the Tariff Methodology, the Capacity Allocation Code and the Market Test Guidelines need to function as a single integrated framework. In several areas, outcome-shaping rules are deferred to later notices, unpublished documents, or standard contract suites without sufficient anchoring in the publicly approved instruments. This creates avoidable uncertainty for applicants and increases the risk of inconsistent implementation or disputes, particularly under scarcity conditions. We have sought to be comprehensive, but we do not represent that this note captures every issue or that errors are impossible, especially given the compressed consultation timeline. That compression also raises concerns about effective due process, because some of the most material points cannot be resolved through ‘quick fixes’ or tracked drafting tweaks. As this report demonstrates, several deficiencies are structural (allocation sequencing, governance / approval points, evaluation architecture, and the interface between tariffs and contracting), and therefore require substantive further work before the secondary instruments can be finalised with confidence. In that context, our view is that finalisation should involve a structured working approach that brings together the key authorities (CCS Authority and RAAEY), the operator, and market participants, to resolve design choices transparently and to ensure the instruments, notices and standard contract suite form a coherent whole. Where feasible within the time available, we also indicate candidate drafting directions for certain high-impact clarifications (and, separately, we have developed more specific drafting suggestions for selected tariff methodology provisions – see section 2.8). The remainder of this document is structured as follows: CCS legislative framework in Greece Review of draft secondary legislation 14 ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 Introduction ● Section 2 reviews the Tariff Methodology, focusing on predictability, allocation of risk, and how the methodology interacts with contracting and competitive processes. ● Section 3 reviews the Capacity Allocation Code, focusing on tranche logic, eligibility / oversubscription handling, sequencing, recycling of capacity, and transfer / non-use provisions. ● Section 4 reviews the Market Test Notice & Guidelines, focusing on evaluation architecture, sequencing with regulated access, the Joint Development Agreement gateway, governance for the economic viability assessment, and reallocation / oversight arrangements. Before proceeding, we note that the consultation package uses different terms for the entity operating the Prinos storage site. The Capacity Allocation Code uses “Φορέας Εκμετάλλευσης” (the holder of the storage permit and operator of the pilot storage site), the Market Test Guidelines use “Storage Operator,” and the Tariff Methodology uses “System Operator.” In this submission, we treat these terms as referring to the same functional role (unless expressly stated otherwise), and we recommend that the final package aligns defined terms (or includes an explicit equivalence statement) to avoid ambiguity about responsibilities, approvals and contractual counterparties. CCS legislative framework in Greece Review of draft secondary legislation 15 Tariff methodology 2 ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 Tariff methodology This section sets out our comments on the draft Tariff Methodology for the CO 2 storage site at Prinos (the “Tariff Methodology”), as issued for consultation on 13 December 2025. Our review has been conducted on a best-efforts basis within the very compressed consultation period. It reflects our independent assessment, from an economic and regulatory perspective, of whether the proposed framework: ● provides a clear, predictable, and transparent mechanism for setting and updating tariffs over the life of the project; ● supports the bankability and financeability of the project for debt and equity investors, in a way that is consistent with appropriate risk allocation between the operator and users; ● is coherent with the draft carbon, capture and storage (CCS) Law in Greece and the relevant European Union (EU) legal and State aid framework, particularly in relation to treatment of public funding and long-term liabilities; and ● adequately addresses the additional design elements that, in our view, are required for a robust CCS tariff regime (eg separation of handling and storage activities, treatment of excluded and value-added services, related party transactions, and possible contributions from oil and gas producers). Given the limited time available in this consultation round, we have not attempted to propose a full set of drafting amendments or a clause-by-clause mark-up of the Tariff Methodology. Rather, we have focused on identifying the main structural, methodological, and drafting issues which, in our view, would require fairly extensive revision for the regime to operate in a robust and balanced way. Our assessment of the Tariff Methodology proceeds in five layers: 1. Overall structure and regulatory model - whether the document articulates a coherent regulatory approach (for example, a ‘building blocks’ vs life-cycle / NPVbased model) and clearly defines allowed revenue and tariff-setting mechanisms over time. 2. General thematic comments - cross-cutting issues such as the treatment of costs and pass-through items, the design and application of the weighted average cost of capital (WACC), the operation of re-opener and adjustment mechanisms, and reporting and verification arrangements. 3. Targeted, provision-specific comments - highlighting selected clauses that raise material regulatory or economic concerns or that present drafting and interpretation issues likely to lead to ambiguity or inconsistency in application. This is not a comprehensive Article-by-Article review, but it focuses on provisions that appear to be of greater significance for the functioning of the regime. 4. Gaps and omissions - matters which, in our view, ought to be covered by a comprehensive tariff regime but are not (or are only weakly) addressed in the current draft. CCS legislative framework in Greece Review of draft secondary legislation 16 Tariff methodology 5. ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 Illustrative drafting directions - in section 2.8 we set out indicative drafting approaches on key topics (NPV framework, cost taxonomy, pass-throughs, WACC, re-openers, reporting and oversight, treatment of non-regulated services, third-party contributions and incentives), intended to show how the regime could be strengthened in practice without attempting a full re-draft of the Methodology. We have sought to present our concerns in a constructive manner, highlighting where the current drafting appears broadly consistent with good practice, and where, in our view, substantial clarification, tightening or re-design would be required for the Tariff Methodology to operate as an effective regulatory instrument. 2.1 Overall structure and regulatory model The consultation draft Tariff Methodology adopts, at its core, a life-cycle / net present value (NPV)-based levelised tariff model. This is made explicit in clause 11.3, where the Capacity Tariff is defined so that the discounted net cash flow of the project, calculated at the WACC, yields a project NPV of zero over the Development, Construction and Operating periods, with closure and post-closure costs also brought into the NPV calculation, albeit without a clearly articulated rule regarding over which period they are recovered. Also, an explicit formula is given for deriving, for each of the handling and storage services, a levelised capacity charge per tonne from the projected cost and volume streams. The same NPV structure is applied separately to the handling and storage services, using a common “forecast volume stored” as the volume driver in both cases. In light of the back-toback booking requirement in clause 5.4 (which obliges users to book equivalent handling and storage capacity for the same period), this is internally consistent at the level of contractual quantities. However, the consultation draft moved from EnEarth’s use of booked capacity as the NPV volume driver to “forecast volume stored (Q)” without explaining the rationale for this change, or how the chosen “Q” interacts with System Capacity, the store-or-pay obligations and the under-utilisation test in clause 15.2, which is framed in terms of aggregate utilised capacity as a percentage of System Capacity (on the latter, see section 2.4.1 below).1 From a regulatory perspective, it would be more consistent with the store-or-pay structure, and with the allocation of demand risk, for the NPV volume driver to be defined explicitly in terms of booked capacity under Store-or-Pay contracts rather than forecast physical injections. For clarity, the Tariff Methodology applies the NPV / levelised approach only to the capacity components of the handling and storage tariffs. Separate capacity tariffs are calculated for the CO2 handling service and for the storage service, and are intended to recover both Capex and fixed Opex (as defined in clause 6, excluding the section 12 categories), while the variable components for both services are treated as pass-through charges, subject to threeyear reconciliation, and are not determined through the NPV model. Within such a framework, the forecast capacity profile used in the NPV calculation should be allowed to reflect realistic ramp-up and ramp-down rather than assuming a flat trajectory over the Operating Period. In practice, this means that users can shape their exposure in early and late years by 1 The ‘hard coding’ of a back-to-back booking requirement between handling and storage capacity in clause 5.4, effectively bundles the two services for access purposes. While this may be operationally convenient for an initial, single-chain configuration, it could limit flexibility to accommodate alternative handling arrangements or additional entry points in future. CCS legislative framework in Greece Review of draft secondary legislation 17 Tariff methodology ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 booking a ramped capacity profile under Store-or-Pay contracts, rather than by excluding ramp-up or ramp-down years from the contractual tenor. In principle, this choice is coherent with the nature of the Prinos storage project as a finite-life, capital-intensive infrastructure with a defined storage horizon. An NPV-based levelised tariff can provide long-term visibility and can be compatible with bankability, provided that the underlying assumptions (on costs, WACC, utilisation and risk allocation) are robust, transparent, and subject to appropriate regulatory control. When read as a whole, however, the Tariff Methodology does not yet present a clear and internally consistent implementation of this NPV model: ● The document builds up cost schedules at pre-final investment decision (FID), FID and pre-commercial operation date (COD) stages and then introduces several review and adjustment mechanisms (for under-subscription, capacity expansion, and extraordinary events after COD, and for changes in WACC between FID and COD). However, it is not clear when and how these mechanisms operate in practice: in particular, the Tariff Methodology does not specify whether such triggers lead to a full re-calculation of the life-cycle NPV and the levelised tariff, or whether they are intended to result only in limited, incremental adjustments (for example, temporary surcharges or correction factors layered on top of the original tariff path). Nor does it define the timing, process, and constraints for any such recalculation or adjustment. ● More fundamentally, the concept of allowed revenue over time is not explicitly defined. The Tariff Methodology focuses on producing service-specific levelised tariffs per tonne (for handling and storage) that balances discounted costs and revenues ex-ante but does not set out the implied annual revenue path or explain how that path is affected by the various cost, volume and WACC adjustments after FID and COD. In the absence of a clear allowed revenue construct, it is difficult to assess ex-ante how risk and upside / downside are shared between the operator and users, and how the different re-opener and adjustment mechanisms interact with the underlying NPV framework. ● The methodology blurs the boundary between regulatory rules and commercial / contractual arrangements. Matters such as the capacity booking process (clause 5), short-term capacity products (clause 5.3), invoicing, and billing frequency (clause 16), and even the potential annulment of contracts following an extraordinary tariff review (clause 15.4.2) are all addressed within the Tariff Methodology. Many of these topics are more naturally the domain of the Capacity Allocation Code or the Standard Storage Agreements, operating under high-level regulatory constraints. Embedding them in the tariff regulation creates duplication and a real risk of inconsistency between instruments, without obvious benefits for tariff setting. ● The overall risk allocation within the NPV framework is not set out in a transparent, integrated way. The Tariff Methodology combines: • levelised NPV capacity tariffs for handling and storage, calibrated at a WACC that itself includes multiple risk premia; • extensive use of pass-through items and three-yearly reconciliations of forecast vs actual costs for these pass-throughs; CCS legislative framework in Greece Review of draft secondary legislation 18 Tariff methodology ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 • extraordinary tariff adjustment mechanisms for “material” events; • provisions for tariff reviews in cases of under-subscription or capacity expansion; • a one-way right for the operator to seek an increase in WACC before COD; and • additional compensation mechanisms and tariff premia for competitively allocated capacity. Considered together, these tools tend to shift a large part of the downside risk onto users, while preserving a relatively generous and multi-layered return structure for the operator. What is missing is a concise statement of the regulatory compact: which risks are genuinely borne by equity (and hence justify the level of WACC and upside protections), which are shared, and which are explicitly socialised through tariffs or fiscal mechanisms. Our strong preference, particularly given the early stage and evolving nature of the Prinos project, would have been for a regulatory asset base (RAB) roll-forward model. A RABbased framework offers a clearer and more familiar foundation for effective regulation: it allows the asset base and allowed revenue to be updated over time in light of actual costs, ramp-up and ramp-down of flows, and any incremental capacity, while applying structured efficiency and prudence tests. It also aligns with RAAEY’s established methodologies in other regulated sectors,2 ensuring methodological consistency and administrative familiarity. However, the consultation draft Tariff Methodology has chosen to adopt a life-cycle, NPV-based levelised tariff model. On that basis, our comments in the remainder of this section focus on what would be required for such an NPV approach to operate in a robust, balanced, and transparent way. In our view, at a minimum, the Tariff Methodology would need to: ● Explicitly set out the NPV framework as the governing model, including when and how it can be recalculated (for example, only at specified regulatory ‘checkpoints’ or control periods, with defined triggers and a symmetric treatment of upside and downside); and ● Define, at least conceptually, the annual allowed revenue path implied by the initial levelised tariff and explain how that path is affected by pass-through reconciliations, volume deviations, WACC changes and extraordinary events. In practical terms, this would mean that, alongside the mathematical expression for the levelised capacity tariffs, the Methodology would: ● make clear whether and how, at defined checkpoints, the NPV calculation could be re-run using updated cost, volume, or WACC inputs (and whether those re-runs apply to the remaining life only or to the whole horizon); 2 RAAEY has adopted RAB-based methodologies for natural gas transmission and LNG regasification terminal operation (Decision E-193/2025), natural gas distribution (Decision 328/2016, electricity transmission (Decision 495/2021), and electricity distribution (Decision 1431/2020). CCS legislative framework in Greece Review of draft secondary legislation 19 Tariff methodology ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 ● show how the levelised capacity tariffs translate into an annual revenue requirement for each service (handling and storage) under the cost and volume assumptions used in the NPV calculation; and ● explain, in a clear and internally consistent way, how that revenue requirement is expected to be adjusted over time in response to clearly defined events (for example, under-utilisation, capacity expansion or extraordinary changes in law), and what share of the resulting upside / downside is intended to be borne by the operator versus users. The Methodology should also rationalise the allocation of subject matter across the Tariff Methodology, the Capacity Allocation Code, and the Market Test Notice & Guidelines, so that the tariff regulation focuses on economic parameters and risk-sharing, while access rules and detailed contractual terms are handled consistently in the other instruments. The more detailed thematic and clause-specific comments that follow are intended to support such a clarification and re-balancing of the chosen NPV model, rather than to reopen the question of model choice itself. 2.2 Treatment of costs, pass-through items, and reconciliation The Tariff Methodology devotes significant space to defining cost categories (Devex, Capex, Opex, Variable Opex, ABEX and closure/post-closure related costs in clause 6) and to distinguishing between costs that are recovered via the levelised Capacity Tariffs for handling and storage and those that are treated as “Pass-Through Costs” (eg clauses 9.4 and 12). Comparing the version submitted by EnEarth with the consultation text issued by HEREMA / RAAEY, the latter contains more detailed wording in certain places (for example, around maintenance capex and fixed versus variable operating costs, and by specifying that reconciliation of pass-through items takes place every three years). However, when the two versions are read together, the underlying approach to costs and pass-throughs remains largely unchanged and, in our view, does not yet provide a robust framework for efficiency, cost control and risk-sharing. 2.2.1 Cost categories and classification Both versions of the Tariff Methodology list the cost items included in Devex, Capex, Opex and Variable Opex. However: ● In several places, cost schedules are still described as “indicative” or “organised in a typical fashion for information.” This is not appropriate language for a binding regulatory methodology. For regulation, the cost taxonomy must be as exhaustive and definitive as possible, with any exceptional items subject to explicit approval, otherwise there is a permanent ambiguity about what can be included in the NPV calculation. This is particularly relevant for items such as financial guarantees or similar instruments, which are not clearly located in any category and could otherwise give rise to ambiguity as to whether they are recovered through general cost allowances, through specific contractual arrangements, or both. CCS legislative framework in Greece Review of draft secondary legislation 20 Tariff methodology ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 ● The consultation draft also introduces references to Capex and Opex of the “relevant asset” (clause 11.3), apparently to distinguish between the handling and storage cost bases. However, “relevant asset” is not a defined term and may obscure the fact that what matters for tariff-setting is the cost base of each regulated service (handling and storage), rather than the physical asset in isolation. Defining the term or referring explicitly to the handling and storage services would be clearer. ● The methodology places significant emphasis on normal accounting practices, and in a few places also refers to “International Standards” or industry standards. While alignment with accounting and industry standards is desirable, statutory accounting is not designed to answer the regulatory question of which costs should be borne by users. In good practice, regulatory frameworks apply explicit tests of whether costs are: • necessary to provide the regulated service; • efficiently and prudently incurred; and • properly allocated to the regulated activity (as opposed to unregulated or value-added services). These concepts are largely absent or only weakly implied in the current text. ● The Methodology does not require the Operator to follow transparent, competitive procurement processes (or an approved procurement policy) for major contracts, including intra-group service-level agreements. Given the scale of the project and the potential for related-party arrangements, a requirement for demonstrably competitive or benchmarked procurement would be a natural complement to prudence and efficiency tests. ● References in clauses 7.3 and 8.3 to “regulatory risks” as a factor to be considered when developing the pre-FID and FID cost schedules are also problematic. By the time the FID cost schedules are set, the core regulatory framework (CCS Law, State aid decision, Tariff Methodology, Capacity Allocation Code) should be in place. Any residual uncertainty about future regulatory change should be addressed, if at all, through a clearly defined return allowance, not through open-ended ‘regulatory risk provisions’ in the cost base. Leaving such provisions undefined risks double counting the same risk both in the allowed return and in the cost allowances and sits uneasily with the idea that the tariff regime itself is the primary instrument for allocating regulatory risk between the operator, users and the State. ● There remains some ambiguity around the treatment of closure, post-closure and long-term liability costs. In the consultation draft, the drafting of clause 6.2.2(

1. e)runs together Variable Opex items (including “Special Levies / Fees for Local Communities”) and “Closure and Post-Closure Costs” in a single sentence, while ABEX remains as a separate heading and the defined term Post-Closure Costs still refers back to section 6. Read in conjunction with clauses 11.5.2-11.5.5, it is apparent that decommissioning, post-closure monitoring and financial contributions into the Special CCS Account are intended to sit within the NPV cost base. However, the relevant obligations are spread across several provisions (the CCS legislative framework in Greece Review of draft secondary legislation 21 Tariff methodology ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 definition of Post-Closure Costs, the description in 6.2.2, ABEX and clause 11.5) and there is no single, internally consistent map of: • which closure and post-closure cost elements are to be recovered via the levelised capacity tariffs; • which elements are expected to be financed via payments into the Special CCS Account and through the “Financial Contribution” under the CCS Law (and how those payments are reflected or netted off in the NPV model); and • whether any residual exposure remains with the operator beyond those funding channels and, if so, how that residual risk is treated in the tariff framework. For a CCS storage regime, it is important to be explicit about the intended funding route for these obligations. One practical example, consistent with the CCS Directive and the CCS Law, would be to treat the Article 25 financial contribution as a ring-fenced operating provision: the total discounted obligation would be determined ex ante, and an indexed annual provision would be included in allowed Opex over the Operating Period, accumulating (in a segregated account or verified balance sheet provision) until the target amount is reached. No regulatory return would be earned on this balance, as it is funded by users, and any surplus or shortfall at the end of injection would be reconciled transparently (for example, via a one-off adjustment or specific pass-through), so that users finance the efficient closure and post-closure costs, but not more. The Financial Guarantee required under the CCS Law is a security instrument for these obligations, not a cost-recovery mechanism in itself: the Tariff Methodology should therefore clarify how the underlying expected costs that the guarantee secures are funded over time through tariffs (for example, via provisions in Opex), and how any re-assessment of those obligations interacts with the tariff framework. The treatment of monitoring and verification costs illustrates the current lack of clarity: they are associated with long-term obligations and listed in clause 11.5.5, but are also referenced in section 6 in a way that aligns with Variable Opex, creating uncertainty as to their precise categorisation and risk-sharing. These are not insurmountable drafting issues, but given the importance and long horizon of closure and post-closure liabilities, a clearer and consolidated treatment in the Tariff Methodology would be desirable. It would also be helpful to distinguish clearly between: • costs of corrective measures and remediation arising despite full compliance with the Operator’s monitoring and operational obligations; and • costs, penalties or damages resulting from the Operator’s breach or negligence. Only the former should, in principle, be eligible for recovery through tariffs, and even then within defined limits. Administrative fines and penalties are not recoverable through tariffs, and corrective measure costs arising from CCS legislative framework in Greece Review of draft secondary legislation 22 Tariff methodology ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 operator fault or non-compliance shall be borne by the operator. Where corrective measures and long-term liabilities are insurable, the Methodology should require the Operator to demonstrate that appropriate insurance or risktransfer arrangements have been sought, and that only net costs (after insurance recoveries) are included in the cost base. ● The Methodology should also distinguish clearly between decommissioning obligations associated with legacy oil and gas assets (which should remain the responsibility of the operator under its existing arrangements with the State) and incremental decommissioning / closure costs attributable to the CCS project, so that pre-existing liabilities are not inadvertently socialised through CCS tariffs. Finally, the Tariff Methodology does not yet define a transparent process for verifying and approving pre-FID and construction-phase expenditure. The operator essentially supplies cost schedules, and while there is reference to “confirmation” of actual costs once construction is complete, there is no structured mechanism for regulatory review, benchmarking, and disallowance of clearly uneconomic, avoidable, or speculative costs. Clause 9.2.3, which disallows recovery of pre-COD capex overruns in excess of 5% relative to the FID Capex Cost Schedule, is a blunt volume-based safeguard rather than a true prudence and efficiency test. It points to an underlying recognition that cost overruns should not automatically be socialised, but it does so in a way that can both disallow efficient expenditure above the 5% threshold and leave inefficient costs within the 5% band entirely unchallenged. This is a significant weakness in a framework that is otherwise asking users to accept a levelised NPV tariff based on those cost schedules. 2.2.2 Pass-through items The concept of “Pass-Through Costs” is important in a CCS context, where certain exogenous cost elements (for example, specific taxes, some types of compliance charges, or potentially European Union Allowance (EUA)-related charges) may legitimately need to be passed through to users. For certain pass-through categories, such as EUA costs linked to leakage or venting, it would be helpful to define an ex-ante ‘efficient’ loss or leakage factor (analogous to technical loss factors in electricity and gas networks). EUA costs up to that factor could be treated as passthrough, while costs arising from leakage above the benchmark (absent force majeure) would be for the Operator’s account. This would align incentives and avoid users bearing the cost of avoidable inefficiency. Across both methodology versions, however, pass-throughs are treated in a way that is both broad and under-specified: ● The definition of pass-throughs is open-ended. The texts provide examples but do not set a closed list (with limited regulatory discretion to add items), nor do they clearly distinguish between: • genuinely exogenous items that are largely outside the operator’s control; and • costs where the operator retains meaningful discretion over quantity, timing, or procurement method. CCS legislative framework in Greece Review of draft secondary legislation 23 Tariff methodology ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 ● In other regulated energy contexts, “pass-through” is typically reserved for charges that are legally levied directly on operators (for example, certain regulated surcharges), not for generic operating inputs such as electricity and EUA costs that are incurred by the operator and can, at least in part, be managed through efficiency, procurement and risk-management strategies. The current drafting largely treats these input costs as pass-throughs, with limited discipline. ● In several places (for example, clauses 4.3.1, 4.4.1 and 9.4.1), compliance with technical thresholds or requirements in the Storage Code appears to be treated as sufficient to justify the recovery of associated costs. While alignment with the Storage Code is clearly necessary, it should not substitute for a separate regulatory assessment of whether such costs are efficient, proportionate and appropriately allocated before being recognised in the tariff model. ● Pass-through items appear to be recoverable at cost, without an explicit requirement to demonstrate that they were incurred efficiently or that reasonable steps were taken to mitigate them. There is no explicit prudence or efficiency filter, and no reference to competitive procurement, benchmarking or ‘least-cost strategies’ for pass-through items that involve purchasing goods or services (for example, energy). ● The Methodology does, on its face, draw a distinction between the levelised capacity components and pass-through / variable costs: clause 11.3 specifies that capacity Opex excludes the cost categories covered by section 12, and section 4 states that costs included in the variable component of the handling and storage tariffs cannot also be included in the respective capacity component. These safeguards help avoid formal double-counting between capacity and variable charges. In substance, however, the drafting tends to treat almost all material variable costs for both services as pass-through items that are charged at cost and reconciled every three years, rather than as part of a regulated variable charge derived from an efficiency-tested cost base. This appears to cover, for example, energy for compression and liquefaction, injection-related costs and post-injection monitoring and integrity activities. In our view, such a broad passthrough treatment of virtually all variable costs is not justified: it exposes users to a wide range of cost risks which could, in principle, be subject to efficiency and procurement disciplines, and the Methodology does not set out specific mechanisms to ensure that these costs are efficiently incurred and competitively procured. In combination, these features risk turning the pass-through category into a broad, weakly controlled channel through which significant variable and exogenous costs can be shifted to users with limited regulatory scrutiny. 2.2.3 Reconciliation mechanisms The consultation version of the Tariff Methodology specifies that actual cost reconciliation of pass-through items will take place every three years throughout the Operating Period (clause 12.3). This provides more detail than the earlier EnEarth draft, but the reconciliation framework as a whole remains very high level: CCS legislative framework in Greece Review of draft secondary legislation 24 Tariff methodology ● ● ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 The Tariff Methodology does not specify: • how differences between forecast and actual pass-through costs are quantified and recorded (for example, whether they are accumulated in a separate regulatory account); • whether the time value of money on under- or over-recoveries is recognised and on what basis; • any materiality thresholds below which reconciliation is not pursued; or • whether, and how, the regulator will subject the reconciled costs to prudence and efficiency tests before allowing recovery. The three-year reconciliations are defined only for pass-through items (clause 12.3) and, as drafted, sit alongside the NPV-based capacity tariffs in section 11 rather than being integrated with them. The Methodology does not explain: • whether the outcome of the reconciliations will affect only the variable / pass-through components of the handling and storage tariffs; • whether any part of the reconciled differences might, in some circumstances, feed back into the capacity tariffs; or • how the timing and magnitude of reconciliation adjustments are constrained so as to avoid very sharp year-on-year changes in overall user charges. This distinction is not purely technical. To avoid a growing share of total charges being recovered through opaque ex-post pass-through adjustments, the Methodology should: ● either integrate reconciled amounts into periodic re-runs of the NPV model on a clearly defined schedule (for example, at pre-set checkpoints) so that the ‘NPV = 0’ principle and the intended risk-sharing are maintained on a whole-life basis; or ● if reconciliations are to feed only into separate variable charges, set clear rules on how they are calculated, discounted, time-profiled and, where appropriate, capped or smoothed, so that their impact on users is predictable and proportionate. Beyond pass-throughs, the Tariff Methodology should also define explicitly how other adjustments (for example, extraordinary tariff reviews following material changes in law, regulation or taxation) interact with the NPV model and any implied allowed revenue path. In practice, this means specifying when an event triggers a full recalculation of the NPV with updated inputs and when only targeted surcharges or credits are applied, how the time value of money is treated, and under what conditions adjustments may be downward as well as upward. Without these elements, users and the operator cannot, ex-ante, form a clear view of the cumulative effect of all adjustments on tariffs and on the operator’s risk / return profile. We note also that, given the volatility and scale of some pass-through items (for example, energy costs), there is a case for more frequent reconciliation (for example, annually) to avoid large step changes every three years. CCS legislative framework in Greece Review of draft secondary legislation 25 Tariff methodology 2.2.4 ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 Summary In summary, while both versions of the Tariff Methodology attempt to list relevant cost categories and to distinguish between base and pass-through items, the current drafting leaves too much discretion with the operator and too little structure around cost verification, efficiency, and reconciliation. For an NPV-based tariff model to be credible and acceptable to users, it would be important to: ● convert the cost taxonomy from ‘indicative’ to definitive, subject to clear regulatory approval for exceptional items; ● embed explicit prudence and efficiency tests for all significant costs, including pass-throughs; ● develop a more granular reconciliation framework, with defined mechanics, timelines, and interaction with the NPV model; and ● introduce robust reporting and verification obligations (for example, regulatory accounts and standardised cost schedules), so that the CCS Authority and RAAEY can monitor costs, scrutinise the cost base used in tariff-setting and ensure that the regime operates in line with its stated principles. These enhancements would not be at odds with bankability; on the contrary, they would improve transparency and predictability for all parties, while protecting users against uncontrolled cost transfer through the tariff mechanism. 2.3 WACC and financial matters The Tariff Methodology gives the WACC a central role: it is the discount rate used in the NPV / levelised tariff calculation and therefore has a disproportionate influence on tariffs over the entire life of the project. The consultation version issued by HEREMA / RAAEY removes the earlier explicit WACC ‘floor’ (clause 7.5.1) and slightly refines some of the wording around the cost of debt and the timing of WACC change requests. Substantively, however, the overall structure and parameterisation of WACC remain largely unchanged, and several important methodological issues persist. 2.3.1 Overall approach to WACC Both the EnEarth and HEREMA / RAAEY drafts distinguish three phases: a pre-FID WACC; an FID WACC, used as the key input to the NPV / levelised tariff calculation; and a third phase in which, in the EnEarth draft, the operator could seek changes in WACC after COD in case of substantial movements in financial market conditions, whereas in the consultation draft this possibility has been moved to the pre-COD period (between FID and COD) and is subject to a one-year notice requirement. In the EnEarth draft, the pre-FID WACC was explicitly tied to the State-aid decision. In the consultation text, this explicit link has been largely removed, except for a reference in the context of the cost of debt. More generally, the Tariff Methodology now treats the State aid CCS legislative framework in Greece Review of draft secondary legislation 26 Tariff methodology ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 return assumptions and the regulatory WACC for tariff-setting as largely separate, with only a residual link via the description of the cost of debt. The State aid decision was taken on the basis of a largely unregulated risk profile, including significant demand risk (risk of not contracting sufficient emitters), whereas the Tariff Methodology, through store-or-pay and various re-openers, substantially socialises that risk onto users. It would therefore be inappropriate simply to transplant State aid risk premia into the regulated WACC. The upshot is that WACC is treated as a core ex-ante parameter of the NPV model, but the methodology does not set out a clear, rule-based framework for: ● how the initial WACC is to be determined (beyond broad statements about market parameters and risk premia); and ● under what conditions, and according to which criteria, WACC may be revisited between FID and COD. The Methodology also confirms that there is no explicit mechanism to revisit WACC after COD, even if market conditions or project risks change materially. This provides certainty but also makes the regime relatively inflexible. In practice, where there is no structured, symmetric process for revisiting the allowed return, proposals to reopen WACC are typically initiated by the operator when its actual or expected returns worsen (for example, because financing costs rise or demand is weaker than expected). There is no equivalent built-in process under which improvements in financing conditions or risk profile would automatically trigger consideration of a lower WACC for users, so any ad hoc discussions are more likely to be prompted by adverse developments than by favourable ones. Moreover, the Methodology does not explain whether different risk characteristics across the three identified phases justify distinct WACC parameters, or how any such differences are to be reflected in the single FID WACC used in the life-cycle NPV calculation. 2.3.2 Parameterisation and risk premia – methodological concerns The WACC is built up in familiar regulatory finance terms: the cost of equity is described using capital asset pricing model (CAPM) concepts (risk-free rate, market risk premium, and equity beta), and then combined with gearing, the tax rate and a cost of debt margin to derive the overall WACC. However, several additions and descriptions depart from standard regulatory and finance practice: ● There is a basic notational inconsistency in the CAPM expression used for the cost of equity. The formula is written as Re = Rf + β (Ε(Rm) – Rf) + SP, but Ε(Rm) is not defined in the Methodology, while a separate “Market Risk Premium (MRP)” parameter is defined. If Ε(Rm) is intended to represent the total expected market return, then (Ε(Rm) – Rf) is itself the MRP and there is no need to define a separate MRP parameter; conversely, if Ε(Rm) is meant to denote the alreadydefined MRP, subtracting Rf within the bracket is incorrect. In either case, the current formulation is ambiguous and should be clarified. If a CAPM framework is retained, the core relationship should be expressed in the usual form Re = Rf + β x MRP. Any size or technology premiums (such as SP) should be treated explicitly as additional uplifts outside the CAPM term and justified on their own merits (as discussed further below). CCS legislative framework in Greece Review of draft secondary legislation 27 Tariff methodology ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 ● Beta (β) is described in 8.5.2(
2. c)by reference to “peers” rather than to the market portfolio. In standard CAPM, β measures the covariance of returns with the market; peer data can be used to help estimate β, but β is not defined as a ‘peerrelative’ parameter. If β is not clearly defined as a standard market β (estimated using peer data but relative to the market portfolio), there is a risk that additional uplifts are introduced under the label of ‘peer’ or ‘sector’ risk, effectively compensating twice for the same underlying risk. ● Market Risk Premium (MRP) is, by definition, a generic, market-wide parameter, specifically, the expected excess return of the market over the risk-free rate. It should not be inflated with project- or firm-specific premia (as per 8.5.3). In a CAPM setting, differences in systematic risk between sectors or projects are reflected through beta (ie through how strongly the project’s returns co-move with the market) and, where strictly justified, through clearly identified additional adjustments. The current drafting risks blurring this distinction by suggesting that the MRP itself can embed CCS or project-specific elements, rather than keeping such considerations separate from the market-wide premium. In addition, “regulatory risks” are referenced both in the construction of the cost schedules (clauses 7.3 and 8.3) and in the description of WACC premia, further increasing the scope for multiple layers of compensation for essentially the same source of risk. ● The methodology introduces a Size Premium (8.5.2(d)) as a separate stipulated parameter, linked to the operator’s “scale and market position.” This goes beyond standard CAPM practice: size effects are not a distinct CAPM parameter, and where regulators recognise them at all, it is usually in narrowly defined circumstances and on the basis of clear evidence (for example, very small entities with demonstrably higher financing costs). The reference to “market position” is particularly vague and risks conflating size with other factors (such as perceived commercial strength or bargaining power) that should not automatically justify a higher allowed return. ● The text also contemplates additional uplifts for technology, innovation, commercial and regulatory uncertainty within the description of the MRP (8.5.3). As noted above, the MRP is a market-wide parameter and should not itself be adjusted to reflect project- or sector-specific risks. If, exceptionally, CCSspecific, or regulatory uncertainties are to be recognised in the allowed return, they should appear as explicit, separately identified adjustments, justified by evidence and, where appropriate, time-limited, and not be embedded implicitly within the MRP. To the extent that specific risks (for example, construction risk, demand risk or certain regulatory risks) are already addressed through insurance, pass-through provisions or extraordinary review mechanisms, they should not also be used to justify higher premia in the cost of equity or cost of debt, otherwise the same risk is compensated more than once. Taken together, these features tend to stack multiple risk premia on top of one another (MRP, β, size premium, technology premium), with a real risk of double counting essentially the same project and technology risks. This is particularly problematic in a regime where other parts of the methodology (pass-throughs, reconciliations, extraordinary adjustment mechanisms) already shield the operator from a significant portion of downside risk. This is compounded by the wording in clause 8.5.2, which presents the CAPM-based formulation of CCS legislative framework in Greece Review of draft secondary legislation 28 Tariff methodology ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 the cost of equity as merely “illustrative.” For a parameter that has such a material impact on tariffs, the methodology would be expected to commit to a clear formula and process, rather than treating it as an example. 2.3.3 Cost of debt – efficient cost vs embedded premia The treatment of the cost of debt raises a similar concern. In both versions, the cost of debt is described as a margin over the risk-free rate which may include, among other elements, a technology or “innovation” premium reflecting the perceived riskiness or novelty of CCS (8.5.4). From a regulatory perspective: ● The cost of debt should reflect an efficient financing cost for a well-managed operator with a reasonable capital structure, and should not automatically mirror the specific margins agreed in individual financing transactions, where these may reflect project-specific or transitory factors. ● If, in practice, lenders require a higher margin for CCS-related risks or projectspecific factors, this should be demonstrated by the operator and assessed by the regulator, using market evidence, rather than being ‘baked in’ ex-ante as a fixed, methodology-level premium. ● Leaving a technology premium hard-wired in the textual description of the cost of debt, without clear evidentiary requirements or limits, creates a risk that the cost of debt is set at systematically high levels, regardless of actual market outcomes or of how risk is allocated through other elements of the regime. In short, the methodology should commit to setting the cost of debt at an efficient benchmark level, with any CCS- or project-specific uplift to be evidenced by the operator and approved by the regulator, rather than enshrined as an automatic feature of the tariff framework. In addition, clause 8.5.4 states that the cost of debt “should also reflect the reduction in risk by the maturation of the project over the time elapsed since the State Aid Decision for the project funding through RRF.” Recognising that financing risk should fall as the project is de-risked is, in principle, directionally sound. However, using the State Aid Decision as the reference point for this adjustment is problematic. The State aid assessment reflects the specific financing package for this project at that time, including construction and delivery risk, first-of-a-kind / technology risk, and sponsor- or structure-specific factors, as well as conservative lender views; these idiosyncratic premia are not an appropriate benchmark for a long-term regulated allowed return, which should be based on the efficient cost of capital for a notional well-run storage operator and compensate primarily for systematic market risk in a CAPM-type framework. The Methodology also still does not specify how and when any reduction in the cost of debt would actually be implemented in the tariff, or why a similar principle would not apply, at least conceptually, to the cost of equity. Without a clear, CAPMconsistent mechanism for translating project maturation into changes in the allowed cost of debt, the reference to the State Aid Decision risks importing project-specific premia into the regulatory WACC and remains largely aspirational. CCS legislative framework in Greece Review of draft secondary legislation 29 Tariff methodology 2.3.4 ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 WACC change mechanisms and asymmetry The consultation text removes the earlier explicit WACC floor, which is an improvement compared to the EnEarth draft. However, the mechanism for changing WACC over time remains asymmetric and weakly specified: ● The operator may request a change in WACC between FID and COD in the event of “substantial” changes in financial market conditions, subject to a one-year notice requirement, but there is no explicit mechanism for revisiting WACC once COD has been reached. ● There is no corresponding provision that would trigger or guide a decrease in WACC if financing conditions improve materially, project risks fall, or the actual cost of debt and equity support a lower allowed return. ● The methodology does not define what counts as “substantial” change, which indicators will be used (risk-free rates, credit spreads, equity premia, etc), or how such a change in WACC would be implemented within the NPV framework (full recalculation of the levelised tariff vs partial adjustment). As drafted, the WACC re-opener operates primarily as a one-way protection for the operator, rather than as a symmetric mechanism for aligning allowed returns with evolving risk and financing conditions. 2.3.5 Interaction with the NPV model and risk allocation In an NPV-based regime, WACC is not simply one parameter among many: it is the discount rate that balances the present value of costs and revenues over the entire project horizon. Small changes in WACC can therefore produce substantial changes in tariffs. At the same time, the Tariff Methodology: ● permits extensive pass-through of certain cost categories; ● provides for three-year reconciliations of pass-through items; ● includes extraordinary tariff adjustment mechanisms for legal, regulatory and tax changes; and ● defines various re-opener scenarios (for under-subscription, capacity expansion, and extraordinary events, plus a WACC change mechanism between FID and COD). Taken together, these provisions mean that a substantial share of cost, volume and regulatory risk is, in practice, shifted to users via pass-throughs and adjustment clauses, while the operator benefits from multiple protections on the downside. At the same time, the WACC and cost of debt formulations allow for several layers of risk premia (including CCS- and sizerelated premia and a technology / innovation uplift), calibrated on a largely fixed, ex-ante basis. The overall regulatory compact implied by this combination is therefore tilted towards the operator: users absorb much of the variability in costs and utilisation, while investors receive a return that appears high relative to the residual risks they actually CCS legislative framework in Greece Review of draft secondary legislation 30 Tariff methodology ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 bear. In our view, any assessment of the appropriate WACC for Prinos needs to be made in the light of this broader risk allocation framework, rather than treating WACC as a stand-alone parameter. Project-specific technical, regulatory and demand risks that are already mitigated or socialised via pass-throughs and re-opener clauses should not be compensated again through WACC premia. 2.3.6 Summary Taken together, the WACC and financial parameter provisions in the Tariff Methodology: ● give WACC a central role in the levelised tariff calculation, but do not provide a clear, disciplined methodology for its initial setting or subsequent adjustment; ● employ a parameterisation that departs from standard CAPM practice and tends to stack multiple risk premia, creating a risk of double counting project and technology risks; and ● contain a WACC change mechanism that is asymmetric and operator-initiated, with no clearly defined downward adjustment logic and no explicit mechanism after COD. A more robust approach would: ● anchor the cost of equity in a transparent CAPM framework, with any CCS- or size-related premia clearly identified, evidenced and, where appropriate, timelimited; ● set the cost of debt at an efficient benchmark level, with any technology or project premia to be demonstrated by the operator and approved by the regulator; and ● design any WACC re-opener as a symmetric, rule-based mechanism, integrated into the NPV model and triggered by objective indicators, so that both investors and users have a predictable understanding of how allowed returns may evolve over time. 2.4 Under-subscription, capacity expansion, and extraordinary reviews Beyond the core NPV / WACC structure, the Tariff Methodology includes several mechanisms that allow tariffs to be revisited during the life of the project, in particular: ● provisions addressing under-subscription of capacity (clause 15.2); ● provisions addressing capacity expansion (clause 15.3); and ● extraordinary tariff reviews (for changes in law, regulation, taxation, or other “extraordinary” events) (clause 15.4). CCS legislative framework in Greece Review of draft secondary legislation 31 Tariff methodology ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 These tools are important in any long-lived infrastructure regime, and they are particularly relevant in an emerging CCS context. However, in both the EnEarth and HEREMA / RAAEY versions, they are drafted in a way that leaves their operation and interaction with the NPV model unclear and, in some respects, one-sided. 2.4.1 Under-subscription and demand risk The Tariff Methodology contains a specific provision for under-utilisation. Clause 15.2.1 provides that, if for any continuous period of six

(6)months the aggregate utilised capacity falls below 85% of System Capacity, and if the associated costs cannot be covered by the store-or-pay mechanism, the System Operator may submit a revised tariff proposal to the regulator for approval. Any revised tariffs are to “ensure the financial viability of the System” while safeguarding remaining users from “prohibitive tariff increases,” and if the tariff increase exceeds 10% per annum in real terms, users may withdraw from their Standard Storage Agreement at no cost (15.2.3). Clause 15.2.2 requires the System Operator to notify users, provide details of under-utilisation and its impact on cost recovery, and consult with the regulator on the proposed approach to tariff revision. Under-utilisation may arise for different reasons, including contract expiry, weaker than expected demand growth, or the default of individual users. The Methodology does not distinguish between these cases, nor does it indicate whether idiosyncratic counterparty default risk is intended to be borne by the Operator, or to be socialised onto remaining users via tariff uplift. Given the small number of expected users at Prinos, this distinction is important: a single default could have a disproportionate impact on the remaining user base if treated purely through the under-utilisation re-opener. “System Capacity” is defined (clause 2) as the maximum throughput of the System, either as built or planned at COD, to accept, inject and store CO2, determined with regard to system integrity and operational needs and measured in tonnes per year. The trigger is therefore framed in terms of utilised capacity relative to System Capacity, rather than booked capacity. However, the Methodology does not explain, in operational terms, how this test is intended to work in a regime that also features long-term store-or-pay arrangements: ● It is not clear what exactly is meant by “aggregate utilised capacity” in this context (for example, whether this refers to physical injected volumes, nominated flows, or some other metric, and whether it is assessed strictly on a rolling six-month basis or over an annualised period). ● The Methodology does not indicate how System Capacity is expected to be sized at FID/COD relative to expected long-term utilisation (for example, whether the system is designed to match forecast committed demand, or with headroom above that level). In the absence of such guidance, it is difficult for users to anticipate in which practical circumstances the 85% threshold might be met. The second condition, that “the associated costs cannot be covered by the store-or-pay mechanism,” is also high-level. The text does not specify: ● which cost base is being tested (for example, whether this refers only to the costs in the NPV/capacity model, or to a broader set of costs); CCS legislative framework in Greece Review of draft secondary legislation 32 Tariff methodology ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 ● whether the assessment is based on historical data over the six-month period, on forward-looking projections, or both; or ● whether any prudence or efficiency checks are applied before concluding that costs “cannot be covered,” particularly where part of the shortfall may be attributable to avoidable design or commercial decisions. In our view, a utilisation test framed in terms of booked capacity under Store-or-Pay contracts, rather than physical injections alone, would be more consistent with the underlying allocation of demand risk and with the use of booked capacity as the volume driver in the NPV model. In a regime with firm store-or-pay obligations, a large part of demand risk is already shifted to users through fixed capacity payments, regardless of short-term fluctuations in physical utilisation. An additional under-utilisation re-opener that can lead to upward tariff revisions therefore operates as a further layer of protection for the operator. If such a mechanism is to be retained, the Methodology should more clearly specify: ● the exact utilisation metric and time window used for the 85% test; ● the cost base and evidence required to demonstrate that costs cannot be covered by store-or-pay; and ● whether any part of the demand risk is intended to remain with the operator (for example, through thresholds, caps or partial absorption of shortfalls) rather than being fully socialised onto users. The Methodology is also silent on the mirror case of sustained over-performance. There is no provision addressing scenarios where utilised capacity and associated store-or-pay revenues turn out to be materially and persistently higher than the levels assumed in the original NPV model, for example, if more users enter under long-term contracts within the same physical capacity, or if reservoir performance allows higher utilisation without additional investment. Even if such scenarios are expected to be limited in practice, it would be helpful for the regime to indicate whether, in these cases: ● any downward tariff adjustments or other user benefits (for example, rebates) are envisaged; or ● higher-than-assumed utilisation is simply retained as additional margin for the operator. In addition, the Methodology does not explain how a tariff review triggered under clause 15.2 is intended to interact with the NPV framework. In particular, it does not clarify whether: ● a material under-utilisation event leads to a full recalculation of the NPV and levelised capacity tariffs using revised utilisation assumptions over the remaining life; or ● any shortfall is addressed through more limited, incremental adjustments (for example, surcharges or correction factors applied for a defined period), without reoptimising the overall life-cycle profile. CCS legislative framework in Greece Review of draft secondary legislation 33 Tariff methodology ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 This distinction is important. In an NPV-based regime, a full re-run of the NPV with updated assumptions can, if properly designed, maintain coherence with the underlying “NPV = 0” principle, whereas incremental, one-way uplifts layered on top of the original path risk eroding that coherence and further tilting the risk allocation in favour of the operator. In our view, this under-utilisation mechanism should not be triggered merely because an individual user under-injects or defaults. The primary tools for managing such events are the store-or-pay obligation, collateral or other security arrangements, and reasonable efforts by the operator to remarket released capacity. Only where, after these contractual and commercial measures have been applied, there is a persistent, structural shortfall in booked or utilised capacity should an under-utilisation review be considered, and any resulting tariff changes should follow from a transparent re-run of the NPV model and, where appropriate, reprofiling of the remaining revenue requirement rather than ad hoc surcharges on remaining users. Finally, the consultation draft introduces a provision that, if a tariff increase exceeds 10% per annum in real terms, users shall have the right to withdraw from their Standard Storage Agreement at no cost. While this can be seen as a protection against very sharp tariff increases, the practical feasibility and system-wide impact of such a right are not addressed. In particular, if a significant number of users were to exercise this right simultaneously, the consequences for the remaining users and for the operator’s risk profile could be substantial. 2.4.2 Capacity expansion and incremental investment The Tariff Methodology envisages the possibility of expanding System Capacity, ie increasing the maximum throughput of the System beyond the level as built or planned at COD. In such cases, additional investment and operating costs associated with the expansion are to be reflected in revised tariffs. Clause 15.3.2 provides that new investments related to New Storage Capacity beyond the IESC shall be priced according to the provisions of the tariff regulation, with reference to prospective users, and other parts of the Methodology allow capacity expansion to be brought into the tariff calculation after COD. The current drafting, however, leaves several important points unclear: ● Definition and governance of “economic viability.” The Methodology states that the System Operator “shall first test the economic viability of a capacity expansion, taking into account existing Booked Capacity, technical feasibility and financial considerations. Upon confirmation of expansion economic viability, the System Operator shall calculate revised tariffs to ensure recovery of the full, efficient costs associated with the expanded capacity.” “Economic viability” is not defined or tied to any clear cost–benefit or least-cost test, the assessment is left to the operator, and there is no explicit regulatory approval role in determining whether expansion is justified. Nor is there any provision that costs arising from avoidable design choices or inefficient expansion solutions should be excluded or disallowed. In a regime where expansion costs can be added into the tariff model after COD, the absence of a regulator-led, clearly specified economic and efficiency test weakens incentives for cost control and prudent expansion decisions. CCS legislative framework in Greece Review of draft secondary legislation 34 Tariff methodology ● ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 Integration into the NPV framework. The NPV / levelised tariff is calculated on the basis of forecast costs and “forecast volume stored” over time. The Methodology does not explain how an expansion of System Capacity interacts with those original forecasts. It is not stated whether expansion: • triggers a re-estimation of the NPV over the remaining life of the project using updated cost and volume profiles; or • is treated as an incremental adjustment (for example, by adding an extra block of capacity and associated revenue without re-optimising the whole life-cycle profile). Without a defined approach, there is a risk that expansions are simply layered onto the original NPV model in an ad hoc way, further obscuring the overall riskreturn balance. ● Allocation of expansion costs between existing and new users. The text indicates that expansion-related costs will be included in tariff calculations and that new investments linked to New Storage Capacity will be priced under the tariff regulation, but does not clearly distinguish between: • expansions primarily driven by new demand, where costs might reasonably be borne mainly by new users (for example, through incremental capacity products or dedicated tariff components); and • expansions whose costs are spread across all users, including those who contracted under the pre-expansion configuration. Nor does it address the interaction with capacity allocation rules: for example, whether existing users with long-term contracts have any priority over additional capacity, or whether all incremental capacity is offered through competitive processes. While the detailed rules on allocating New Storage Capacity will properly sit in the Capacity Allocation Code and, where relevant, the Storage Code, the Tariff Methodology needs to be coherent with those access rules, because the way incremental capacity is allocated has direct implications for how expansion costs ought to be allocated between existing and new users. For example, if the Capacity Allocation Code provides that additional capacity is offered through specific products (eg shorter-term or competitively allocated capacity) or gives some form of priority to existing long-term users, the tariff framework should explain whether and how the costs of expansion are targeted at the beneficiaries of that additional capacity, rather than automatically socialised across all users. This is consistent with our comments on the Capacity Allocation Code, where we emphasise the need to align the treatment of New Storage Capacity and product design with the underlying cost allocation and risk-sharing principles. ● Consistency of capacity concepts. Related concepts such as IESC, New Storage Capacity and System Capacity are used across the CCS Law, the Capacity Allocation Code and the Tariff Methodology. The current drafting of the Methodology does not clearly distinguish between: CCS legislative framework in Greece Review of draft secondary legislation 35 Tariff methodology ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 • improvements in the performance of an existing storage site (allowing more volume to be stored within the same physical footprint); and • genuinely new storage fields or reservoirs that may require a new or amended storage permit. From a tariff perspective, it would be helpful to signpost how these different cases are expected to be treated: for example, whether additional storage capacity arising from improved reservoir performance is brought into the existing NPV model, whereas capacity associated with a new storage site is treated as a separate project with its own cost base and access rules. A more transparent and balanced approach would: ● define “economic viability” in regulatory terms (for example, by requiring an explicit cost-benefit and least-cost test for expansions, assessed and approved by the regulator); ● specify whether, and in what manner, expansions lead to a recalculation of the NPV and levelised tariff, and over which horizon; and ● set out high-level principles for allocating expansion costs between existing and new users in a way that is consistent with the access framework, and that avoids socialising the cost of avoidable or inefficient expansions onto users who do not benefit from them. 2.4.3 Extraordinary tariff reviews and change in law The Tariff Methodology allows for tariffs to be revisited in the event of “material” changes in law, regulation, taxation, or other extraordinary events. This is framed in broad terms, and the text also provides for the possibility, in extreme cases, of annulling the affected contracts (15.4.2), subject to the agreement of all parties and the regulator. From a regulatory point of view, it is legitimate to have an extraordinary review mechanism for genuinely unforeseeable, exogenous shocks (for example, fundamental tax reforms or major CCSspecific regulatory changes). However, in the current drafting: ● the concept of “material” or “extraordinary” is not defined or tied to any quantitative thresholds; ● the direction of adjustment is not framed symmetrically - the text implicitly focuses on upward adjustments to protect the operator but says little about circumstances where changes in law or regulation reduce costs or risks; and ● the methodology does not explain whether an extraordinary review triggers a full re-run of the NPV calculation with updated inputs, or whether it results in more limited, incremental adjustments layered on top of the existing tariff. More specifically, we consider that ordinary fluctuations in utilisation and the default or exit of individual users, where store-or-pay and associated credit protections are in place, should not in themselves be treated as “extraordinary events” justifying tariff increases. Those risks are more appropriately addressed through contractual tools (store-or-pay, guarantees, collateral, CCS legislative framework in Greece Review of draft secondary legislation 36 Tariff methodology ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 insurance and remarketing of capacity). The extraordinary review mechanism should be reserved for genuinely exogenous legal, regulatory or tax shocks, and applied symmetrically where such changes reduce, as well as increase, costs and risks. The clause allowing, in principle, for contracts to be annulled following an extraordinary review (if all parties and the regulator agree) is particularly strong. Even if consensual, including such a provision in a tariff methodology (rather than leaving it to contract law) blurs the line between economic regulation and commercial renegotiation, and could be perceived as undermining the stability of long-term agreements. Overall, the extraordinary review mechanism is framed broadly and qualitatively, without: ● clear triggers and materiality criteria; ● a defined process and timeline; or ● a transparent link to the NPV framework and to the sharing of upside / downside between the operator and users. In addition, some events that might trigger an extraordinary review (for example, user default or sustained under-utilisation) are already addressed, at least in part, through the store-or-pay and under-subscription provisions. The methodology does not explain how these overlapping mechanisms are intended to interact in practice, for example where the same underlying event could be characterised both as under-utilisation and as an extraordinary change. Finally, given that the Storage Management Code will define key operational parameters (for example, ramp-up and ramp-down rules, planned maintenance windows, losses and shortfall handling) that directly influence costs and capacity, the Tariff Methodology should: ● be developed in close coordination with the Storage Management Code; and ● treat any future material change to the Storage Management Code that affects these cost drivers as a clearly defined trigger under the extraordinary review / change-in-law mechanism, with symmetric treatment of upward and downward impacts. 2.4.4 Summary The provisions on under-subscription, capacity expansion and extraordinary reviews introduce important flexibilities into the tariff framework, but they remain broad in scope and only partially integrated with the NPV model. ● Under-subscription. The Methodology defines a specific trigger (aggregate utilised capacity below 85% of System Capacity over any continuous six-month period, coupled with insufficient coverage of costs through the store-or-pay mechanism). However, it does not clarify precisely how “utilised capacity” is to be measured over time, how the store-or-pay coverage test is to be applied in practice, or whether any part of demand risk is intended to remain with the operator rather than being fully socialised onto users. Nor does it address the mirror case of sustained over-performance (persistently higher-than-assumed utilisation and store-or-pay revenues) and whether this should ever lead to CCS legislative framework in Greece Review of draft secondary legislation 37 Tariff methodology ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 downward tariff adjustments or other mechanisms by which users benefit if the project performs better than assumed in the original NPV case. ● Capacity expansion. The Methodology recognises the possibility of increasing System Capacity after COD and of reflecting the associated costs in revised tariffs, but does not set out clear rules on how expansion is brought into the NPV framework (full recalculation vs incremental adjustment), how “economic viability” is to be defined and tested in regulatory terms (including least-cost and efficiency considerations), or what role the regulator plays in approving expansions. It also does not provide high-level principles on how expansion costs should be allocated between existing and new users, or how the tariff treatment of expansions is intended to interact with the access framework (including the treatment of IESC, New Storage Capacity and any additional storage fields or sites). ● Extraordinary reviews. The extraordinary review mechanism for “material” changes in law, regulation, taxation, or other events remains loosely framed, with no quantitative materiality thresholds, no defined process and timeline, and no explicit link to the NPV calculation. The possibility of annulling contracts following such a review, even if subject to agreement of all parties and the regulator, sits uneasily in a tariff methodology and blurs the boundary between regulation and commercial renegotiation. The provisions are written primarily from the perspective of addressing adverse shocks and do not explicitly contemplate circumstances where changes reduce costs or risks. Overall, these mechanisms would benefit from being recast as more rule-based and symmetric tools, explicitly linked to the NPV model, with: 2.5 ● clear definitions of triggers and materiality; ● a transparent description of whether each trigger leads to a full NPV recalculation or only to specified incremental adjustments; and ● an explicit statement of how demand and expansion risks are intended to be shared between the operator and users, including the conditions under which tariffs may move in either direction. Reporting, verification, and regulatory oversight A key element of any tariff regime is the framework for reporting, verification, and regulatory oversight. This is particularly important in an NPV-based model, where the capacity components of tariffs are constructed on the basis of projected costs and volumes, and the variable components are then adjusted over time via pass-through reconciliations and reviews. In both the EnEarth and HEREMA / RAAEY versions of the Tariff Methodology, there are references to cost schedules, audited cost data, and normal accounting practices. However, there is no fully developed reporting and verification regime comparable to that seen in other regulated sectors. CCS legislative framework in Greece Review of draft secondary legislation 38 ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 Tariff methodology 2.5.1 Existing references in the Tariff Methodology The Tariff Methodology contains several provisions that touch on reporting or verification, for example: ● requirements for the operator to maintain cost records and schedules (Devex, Capex, Opex, Variable Opex) (clause 6.2.3); ● references to normal accounting practices for recording costs (clause 6.2.3 and 7.2.1); ● the regulator’s right to request audited opex and capex data (clause 10.2.1); ● references to audited pass-through costs in the context of periodic reconciliation (clause 12.3.1); and ● general obligations to provide information in support of tariff calculations and reviews. These references acknowledge that the regulator and other stakeholders will need access to cost information. However, they remain at a high level and are largely framed in terms of underlying statutory accounting and ad hoc provision of data, rather than as a specific regulatory reporting and audit framework. 2.5.2 Gaps in reporting and verification arrangements Against this background, several gaps stand out: 1. No defined set of regulatory accounts or templates a. The Tariff Methodology does not require the operator to prepare regulatory accounts or standardised cost schedules distinct from statutory financial statements, nor does it provide for the development of standardised reporting templates under the supervision of the regulator. In particular, there is no framework for: i. consistent annual or multi-year reporting of Devex, Capex, Opex and Variable Opex for regulatory purposes; ii. systematic separation, within the operator’s regulatory reporting, between: 1) CCS-related costs and other group activities; and 2) within CCS, the costs of the regulated handling and storage services and any unregulated or value-added services that make use of the same assets (for example, optional conditioning beyond the minimum specification, bespoke flexibility products, or use of shared facilities for non-CCS customers). Even if no such unregulated or value-added CCS legislative framework in Greece Review of draft secondary legislation 39 ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 Tariff methodology services exist at COD, it is sound practice in a nascent sector like CCS for the methodology to foresee this possibility, so that future developments can be accommodated without crosssubsidy or ambiguity over what costs fall within the regulated perimeter; iii. structured reconciliation between the forecast figures used in the NPV calculation and the actual costs reported over time, or at least a clear framework for comparing them and explaining material deviations; or iv. disaggregated reporting by major project components (eg handling plant, wells, platforms, pipelines, monitoring systems), so that the cost base can be scrutinised and benchmarked by component and aligned with the distinct eligibility and clawback rules of different public funding streams. Even in an NPV-based regime without periodic revenue resets, the absence of such regulatory reporting arrangements makes it harder for the regulator to interpret and test the cost assumptions underpinning the levelised tariff, to assess subsequent pass-through reconciliations and adjustment requests, and to monitor whether costs are being allocated in line with the rules set out in the Tariff Methodology. 2. Limited specification of audit and assurance a. b. 3. While some provisions refer to “audited” costs (particularly for pass-through items), the Methodology does not state explicitly: i. whether this refers only to the statutory financial audit, or to a separate regulatory audit of cost allocations (in the absence of clarity, there is a risk of differing interpretations as to the depth and purpose of the audit that supports tariff-setting); ii. the scope and frequency of any such audits; or iii. whether the regulator has the right to commission additional assurance work on specific cost items or categories (for example, major contracts or related-party transactions). The inclusion of clause 10.2.1, which allows the regulator to request audited opex and capex data, is a step in the right direction, but it does not, by itself, amount to a defined regulatory audit framework. For a project that benefits from public support and regulated tariffs, a more explicit assurance framework would normally be expected. No structured cost verification mechanism a. As noted in the cost section, pre-FID and construction-phase expenditure is taken largely from operator-supplied schedules, with only general references to “confirmation” of actual costs after construction. CCS legislative framework in Greece Review of draft secondary legislation 40 ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 Tariff methodology b. c. 4. i. material project costs are tested for efficiency and prudence; ii. uneconomic or avoidable expenditures can be disallowed or partially disallowed; and iii. major contracts (including with related parties) can be scrutinised from a regulatory perspective. This is a notable omission if tariffs are to be based on a levelised NPV of costs that have not been subject to any structured regulatory challenge. Weak linkage between reporting and adjustments a. b. 5. The Tariff Methodology does not define a cost verification process under which: The Methodology provides for three-year reconciliations of pass-through costs, and for various tariff reviews (under-subscription, capacity expansion, extraordinary events), but it does not spell out: i. what reporting obligations are triggered in each case; ii. what minimum information must accompany a request for a tariff adjustment (and, where applicable, any WACC change); or iii. how the regulator is expected to test and validate the information provided before deciding. Without a clearer linkage, there is a risk that reviews and reconciliations become discretionary and opaque, rather than rule-based processes grounded in transparent, verifiable data. No explicit monitoring / compliance provisions a. b. The Tariff Methodology includes a short section on “Monitoring and Reporting” (clause 10), but this is very brief and high-level and does not amount to a comprehensive monitoring and compliance regime. For example, it does not specify: i. whether the operator must submit regular performance and cost reports to the CCS Authority / RAAEY; ii. whether there are deadlines and consequences for late or incomplete reporting; or iii. whether there are mechanisms for users or other stakeholders to raise concerns about cost trends, allocation practices, or tariff implementation. In established regulated sectors, such provisions are often complemented by guidance or secondary instruments, but their absence here leaves a significant gap in the overall governance framework. CCS legislative framework in Greece Review of draft secondary legislation 41 Tariff methodology 2.5.3 ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 Why stronger reporting and verification matter in an NPV regime These gaps have particular significance given the choice of an NPV / levelised tariff model and the use of pass-through and adjustment mechanisms: ● Tariffs and allowed returns are derived from a discounted view of future costs and volumes, yet the Methodology provides only limited structure for checking and challenging the costs that enter that view. ● Pass-throughs and periodic reconciliations are designed to address uncertainty, but without robust reporting and verification they can become channels through which large cost items are shifted to users with little scrutiny. ● From a bankability perspective, clear reporting and oversight arrangements are not an obstacle; rather, they underpin the credibility of the regime. Investors generally prefer a framework where the rules are clear and applied consistently, even if that involves a higher standard of cost justification. In short, an NPV-based regime with relatively generous adjustment tools but only generic reporting references risks being perceived as tilted towards the operator, because there is no visible mechanism through which regulators and users can test whether costs are reasonable and efficiently incurred. 2.5.4 Summary In summary, the Tariff Methodology: ● recognises that cost information must be recorded and, in some cases, audited, but stops short of establishing a comprehensive regulatory reporting and verification framework; ● does not require the preparation of regulatory accounts or standardised reporting templates, separate from statutory financial statements; ● leaves the scope, frequency and focus of cost assurance largely undefined; and ● does not clearly link reporting obligations to the various reconciliation and review mechanisms that can materially affect tariffs. To support both effective regulation and investor confidence, it would be important to complement the current drafting with: ● clear obligations to prepare and submit regulatory cost schedules and accounts, in a standardised format, at least at the FID / COD baseline (when the levelised capacity tariffs are set) and whenever material adjustments (for example, major expansions or extraordinary reviews) are requested; CCS legislative framework in Greece Review of draft secondary legislation 42 Tariff methodology ΣΥΝΗΜΜΕΝΟ Ρυθµιστική Αρχή Αποβλήτων Ενέργειας και Υδάτων 29/12/2025 Α. Π.: I-408177 ● explicit provisions on regulatory audit / assurance, including the regulator’s rights to seek additional information and independent review of significant cost items; ● a defined cost verification process for pre-FID, construction, and major expansion expenditures, with scope for disallowance of clearly inefficient or unjustified costs; and ● a tighter connection between reporting and decision-making, so that any tariff review or reconciliation (and any WACC adjustment, where applicable) is grounded in transparent, verifiable data. Such enhancements would align the Prinos regime more closely with regulatory practice in other infrastructure sectors and would provide a more solid foundation for the NPV-based tariff model envisaged in the Tariff Methodology. 2.6 Drafting and interpretation issues In addition to the substantive points discussed above, a number of drafting and interpretation issues in the Tariff Methodology may give rise to ambiguity or inconsistent applica