No plans for Bulgarian electricity export tariff rise- regulator

Irina Peltegova

28-Apr-2015

There are currently no plans to increase Bulgaria’s electricity export tariff, according to the Bulgarian energy regulatory commission EWRC.

Earlier this month comments by Bulgarian prime minister Boyko Borisov suggested that the existing export tariff could more than triple from the current €4.08/MWh by adding a fee called “public obligations” to it (see EDEM 8 April 2015).

The news made traders at the time uneasy considering that the export tariff had seen plenty of last minute changes in the past.

“EWRC has no concrete plans to increase the export tariff,” Svetla Todorova, commissioner at EWRC told ICIS on Tuesday.

“These were some political announcements, nothing has been discussed by the institutions,” Todorova said referring to the prime minister’s remarks. Nevertheless, the potential increase of the tariff was the main discussion point during an industry event in Sofia on Tuesday.

Participants maintained the view expressed over the years that the tariff is pricing Bulgarian electricity out of the central and eastern European markets.

Previously, in July 2012, a 50% rise was applied to the tariff pushing it to €17.52/MWh. The figure was adjusted down to €6.37/MWh as of 1 August 2013, then to €3.53/MWh as of 1 January 2014.

The last adjustment was made from 1 July 2014 when the tariff was increased by 15% to €4.08/MWh.

Since the tariff was substantially reduced from the beginning of last year Bulgarian electricity exports have almost doubled, according to Martin Georgiev, chairman of the Bulgarian electricity traders association ATEB.

Thus another increase would only mean lack of exports of Bulgarian electricity which would translate into around Bulgarian lev 1bn annual loses by generators, mining industry and the grid operator.

He noted that at times when the export tariff was higher some 500MW were being transited via Bulgaria compared with only 25MW under the lower tariff.

An increase of the tariff would lead to a financial crisis for the Bulgarian producers and also a political crisis as was the case when the tariff jumped a few years ago, according to Nikolay Kiskinov, representative of the Bulgarian free market association (ASEP).

“Even if the fee is imposed it would last only for several months, the fee is simply incompatible with the way the Bulgarian system works,” Kiskinov said. irina.peltegova@icis.com

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