Bulgarian exchange IBEX aims for 8 December launch date

The long-awaited Bulgarian day-ahead electricity exchange IBEX is aiming to launch on 8 December, provided energy regulator EWRC finalises some changes to the trading rules in time, IBEX head Konstantin Konstantinov said on Wednesday.

IBEX is partnering with Nordic exchange Nord Pool Spot which will deliver the trading system and operate the day-ahead market as a service provider. The exchange is expected to provide a market-based reference price for the underdeveloped Bulgarian power market.

The exchange held its first workshop on Tuesday informing future market participants of how the exchange will operate.

“Our target launch date is 8 December, we would be ready but it doesn’t depend only on us. The trading rules need to be changed,” Konstantinov said, adding that while the changes were rather cosmetic they were a precondition for the launch.

“We submitted the necessary papers to the regulator on 13 July but EWRC has been busy with the regulated tariffs. However, EWRC promised it won’t cause delays to the exchange launch,” Konstantinov said.

Next steps

IBEX will publish trading fees on 10 October on its newly established website www.ibex.bg.

Registration for market participants is expected to start in early November followed by a testing phase as of 24 November.

In addition, state-owned producers such as utility NEK, the Kozloduy nuclear power plant and the Maritsa East 2 coal-fired plant are likely to become market makers by signing contracts to sell certain quantities on IBEX and ensuring liquidity.

Traders who attended the workshop said things were finally moving in the right direction after years of delays.

Nevertheless, one of them noted that the targets that both IBEX and the government have set were quite ambitious given the short time frame.

Full market liberalisation is a priority for the government and is expected from the beginning of next year, the energy ministry said in a statement on Tuesday.

Currently 42% of Bulgarian consumers source their electricity from the open market while the rest – which comprise of low voltage businesses and households – remain supplied under regulated tariffs.

However, the country’s energy law needs to be amended before the market opens fully, which would take time. And these amendments would depend on a new market model which is not yet finalised. The World Bank is advising the government on the matter but concrete details are yet to be revealed.

“It looks like they [the government] want to do it all in one go – to launch an exchange and liberalise the market fully. But there’s really no need [to rush],” the trader said. irina.peltegova@icis.com