Way open for electricity prices in Bulgaria to fall in March, but by how much remains unknown

Written by on February 28, 2013 in Bulgaria, Business, News - No comments

The amendments to the Energy Act approved by Bulgaria’s Parliament on February 27 2013 could open the way for a reduction in electricity prices from March 1, but by how much remained unknown in the first hours after the decision was taken.

Amid the national protest crisis that sparked the resignation of Boiko Borissov’s government, Borissov responded to the demands of those up in arms over their electricity bills by speaking of an eight per cent cut in electricity prices from March.

Whether this would be possible became the subject of debate amid the national uncertainty that followed Borissov’s decision to quit, but with electricity bills having been the signal issue that later grew into mass protests for wider reforms, pressure to at least deal with an issue that has been hitting people hard in their pockets is considerable.

After Parliament approved amendments changing the rules so that the energy regulator can adjust the price of electricity more than once a year, Economy, Energy and Tourism Minister Delyan Dobrev – who like all his cabinet colleagues is in an acting capacity pending the formation of a caretaker government – declined to predict what would happen to the price of electricity and referred questions to the energy regulator.

That regulator is also serving in an acting capacity after its entire membership submitted their resignations soon after the government did. Its recently-appointed chief, Yuliana Ivanova, earlier tabled her resignation at Borissov’s request after it emerged that she owned a company that had been illicitly trading online in cigarettes.

The State Energy and Water Regulatory Commission, in turn, declined on February 27 to engage in forecasting what the electricity price would be.

As a special measure, the amendments approved by Parliament were scheduled to be rushed into print in the State Gazette on February 28.

Dobrev said that the regulator could hold hearings soon on changing the price of electricity.

Whatever the regulator decides, the change will enter into force on the day that it is adopted.

Dobrev said that the government’s earlier statement on an eight per cent reduction in the electricity price had been based on preliminary estimates. He said that the two main ways to reduce costs of electricity were to change the quotas of energy taken from more expensive sources and increasing the quota from Bulgaria’s Kozloduy nuclear power station; the other main way would be to reduce the permissible losses of the electricity distribution companies.

Responding to a request from Prosecutor-General Sotir Tsatsarov to intervene to reduce the price of electricity, Dobrev said that if he made an order of this kind, it would not reduce the price itself but only defer the payment of part of the cost of electricity – lost income and additional costs incurred – to a later date. Tsatsarov said that he made the request to Dobrev to cut the cost of electricity against the background of the widespread national protests on the issue. Dobrev said that the best option was for the regulator to review the price.

 

(Photo: Clive Leviev-Sawyer)

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