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Bulgarian TSO defends electricity ‘system tariff’ despite investment fears

01 May 2012 15:11:59 | edem

Bulgarian grid operator ESO has defended the country's electricity export fees, despite concern that the measure is withholding investment in new power generation assets.

The fees are necessary to guarantee system safety, a spokeswoman for the transmission system operator (TSO) said, adding that an "actual export fee" in Bulgaria "does not exist".

"The fee associated with electricity export is in fact a system tariff comprised of components for access, flow and green energy. This is paid by the system users at the border for the quantities of electricity which have left the country," she said.

According to a member of the European Federation of Electricity Traders (EFET), the operator's view was accurate, but in most European countries system tariffs are paid by consumers, not by electricity traders or producers.

"These tariffs are putting off future investors who would be willing to build new generation in the country," the EFET member said on Monday.

"If Bulgaria wants to be an export-orientated country it has to find a way to deal with this problem. Putting the burden on electricity producers is not the solution," the EFET member added.

He said Bulgarian electricity producers are disadvantaged because they cannot compete with producers in countries that do not have to pay such tariffs.

ESO view

If electricity producers were no longer obliged to pay the tariffs, then industry and households would have to pick up the tab and the end-user electricity price would have to be increased, ESO said.

"There has to be balance and set priorities, but the grid operator cannot go without the income required to invest in the system and maintain system safety," the spokeswoman said.

In 2011 more than 25% of Bulgaria's net production was exported. The export-associated tariff stands at €11.70/MWh.

However, Bulgarian state-owned incumbent NEK is seeking a large increase in the renewable energy component associated with the tariff from 1 July, pushing it to €16.00/MWh (see EDEM 7 March 2012).

In March the Association of Traders with Electricity in Bulgaria (ATEB) sent a letter to Bulgarian energy regulator DKER asking for the fee associated with electricity exports from Bulgaria to be scrapped on the grounds that it flew against Europe's push for a single electricity market.

Market participants said that the free, price-sensitive flow of electricity around the power transmission system was impossible because the fee deterred potential investors (see EDEM 15 March 2012). IP

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