Monday, June 04, 2012

Greece Financial Lesson No. 324: Not Paying Your Bills is Bad

You see when you owe several hundred million Euros to suppliers (of things like natural gas) those suppliers tend to cut you off. Eventually. Greece debt crisis mutates into energy crunch | Energy | News | Financial Post
According to an energy industry source who declined to be named, DEPA has no cash to settle gas supply bills worth a total 120-million euros (US$148.4-million) with Italian gas firm Eni , Turkey’s Botas and Russia’s Gazprom, which fall due this month.

DEPA CEO Haris Sahinis declined to comment on the company’s cash position but told Reuters: “DEPA is taking every action to avoid owing anything to its suppliers.”
The gas company can't pay the foreign suppliers because the electric utilities can't pay the gas company.

Lot's of reasons, but one of them is government interference into the marketplace.
The account went into deficit because its receipts have not matched the generous subsidies it pays out to renewable energy producers, particularly for solar panels.
Don't get me wrong, I love solar panels. I have 2 on my boat. But I didn't get a subsidy for buying them. They solved a problem. I don't know why I should expect taxpayers to solve my problems. But apparently the socialists can't leave the market alone.
[Hat tip: Small Dead Animals]

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