LONDON (ICIS)--Bulgaria’s electricity export tariff rose by 6.5% to leva (Lv) 9.84/MWh (€5.03/MWh) as of 1 July, according to a decision published by energy regulator EWRC on Sunday, 1 July.
While the final increase was lower than previously expected, market participants were kept on their toes until the very last moment, creating an uncertain trading environment.
“Up until yesterday [Sunday] there was no information at all. It is hard [to trade in such an environment],” one Bulgarian trader said on Monday.
Bulgaria is a net exporter in the region but the existence of the export tariff and the fact that it can change more than once a year creates a risky environment for cross-border traders.
The tariff comprises a fee for accessing the transmission system and a fee for transmission through the electricity system.
Back in April, Bulgarian grid operator ESO asked for a 37% increase of the tariff which traders deemed overdone at the time.
Then towards the end of May, EWRC proposed an 11% rise to (Lv) 10.24/MWh (€5.24/MWh) from 1 July but it took the regulator over a month to publish the final decision on the day when it comes into force.
In the weeks running up to the decision, Bulgarian market participants told ICIS that they were expecting that the regulator would approve the 11% increase but many also said that there had been plenty of examples in the past when the tariff had been increased well above expectations at the last minute.
While the new 6.5% increase is not substantial enough to affect Bulgarian exports in the coming months, traders have been reiterating their view that the tariff should be scrapped all together to bring Bulgaria in line with the other EU countries.
Bulgaria has announced ambitious market coupling plans with neighbouring Serbia, Romania and Macedonia in 2019.
These cannot materialise if the export tariff remains. It would be up to the government to make the necessary legislative changes first, however.