Bulgarian utilities regulator approves lower electricity prices

Written by on March 5, 2013 in Bulgaria, Business, News - No comments

Bulgaria’s State Energy and Water Regulatory Commission (SEWRC) said on March 5 that it approved the proposed electricity price cuts that will go into effect immediately, Bulgarian news agency BTA reported. The price cuts will average between 6.2 per cent and 7.3 per cent, depending on the geographic location of end-customers.

The decision comes as nationwide protests – initially against the high prices of electricity and sudden jump in electricity bills in January – continue into the fourth week.

The regulator’s meeting on March 5 happened with another rally outside its headquarters, although this one featured about 2000 miners and railway workers protesting against any last-second changes to the SEWRC proposal and the prospect of decreasing the amount of more expensive electricity generated by thermal power plants that goes to households.

Despite initial statements from acting Economy and Energy Minister Delyan Dobrev that cutting the weight of electricity produced by thermal power plants and replacing it with cheaper electricity produced by Kozloduy nuclear power plant, SEWRC’s proposal envisioned no such changes.

Instead, the price cut would come from reducing the price of electricity generated by gas-powered plants – a move SEWRC could afford because of the 20 per cent cut in the price of gas bought from Russia starting January 1 – and reducing the margin of “technological losses” afforded to the three private electricity distribution companies from 15 per cent to 12 per cent, the regulator said on March 4.

The electricity distribution companies are allowed to bill customers for the electricity “lost” through their power grid on the way to end-users, with SEWRC setting the maximum level of acceptable losses. In return, the electricity distribution companies are required to spend the revenue generated this way on investment in grid upgrades and improved energy efficiency – a reduction in the “technological losses” level would leave them with less money to carry out their investment plans.

Bulgaria’s three privately-owned electricity distribution companies – Czech Energo-Pro and CEZ, as well as Austria’s EVN – said on March 5 that they were prepared to take measurements from all electricity meters as soon as possible, so that their customers are billed using the new prices approved by the regulator.

SEWRC approved an average price cut of 6.2 per cent for customers of Energo-Pro (which owns the distribution company servicing northern and northeastern Bulgaria), 7.2 per cent for customers of CEZ (which services western Bulgaria, including capital city Sofia) and 7.3 per cent for customers of EVN (which owns the distribution company servicing southern and southeastern Bulgaria).

Some customers might see different figures, depending on the time when they use the most electricity – the regulator’s decision envisions reductions ranging between 5.3 per cent and 5.8 per cent during daytime and 8.8-14.6 per cent at night.

SEWRC said that the new prices will remain in effect until July 1, at least, and did not envision an upward revision at that time.

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