Today marks the final day of operation for the large lignite-fired power station of Agios Dimitrios, operated by Greece’s Public Power Corporation (DEI), located in Kozani. With five units and a maximum capacity of around 1,600 MW, the plant served for decades as a cornerstone of Greece’s energy system.
A pillar of regional employment
The Agios Dimitrios lignite plant began operations in the 1980s, directly or indirectly employing thousands of workers and serving as a major employer across Western Macedonia. After 42 years, its furnaces are being switched off for good. In a later phase, its cooling towers will be demolished — in a highly dramatic fashion: local media report that controlled explosions are planned.
The end of an era driven by climate policy
The decision to phase out lignite was first announced in 2019 by Prime Minister Kyriakos Mitsotakis as part of Greece’s accelerated energy transition. Once responsible for the majority of national electricity generation, lignite has now reached its nadir. Today, renewable energy sources supply nearly half of Greece’s electricity, while natural gas has taken the lead in conventional generation.
A decisive factor behind the retirement of lignite plants has been European climate policy — particularly the EU Emissions Trading System (EU ETS), introduced at the start of the century. The system placed a price on every tonne of CO₂ emitted by fossil-fuel power plants. Initially low, this carbon price has steadily risen — reaching nearly €73 per tonne today — rendering lignite economically uncompetitive against cleaner alternatives.
In recent years, these plants have largely functioned as backup capacity during peak demand periods or for district heating. Despite limited operation, last year the Agios Dimitrios plant remained Greece’s most polluting energy facility, emitting 2.7 million tonnes of CO₂ — costing an estimated €200 million at current carbon prices.
What comes next?
With Agios Dimitrios now offline, only one lignite unit remains operational: Ptolemaida 5 — scheduled to cease operations by the end of this year. Once it shuts down, Greece’s lignite chapter will be definitively closed.
However, the planned explosive demolition of the cooling towers has drawn opposition from many current and former employees. Trade unions have organized a work stoppage to protest the closure and are calling for an extension of the plant’s operation. DEI’s management has stated unequivocally that no extension is possible — instead, the company has launched a €5.75 billion investment plan for Western Macedonia. This includes solar parks, pumped-storage hydropower facilities, data centers, battery storage systems, and other infrastructure aimed at transforming the region’s economic future.