Bulgarian President lodges constitutional challenge against renewable energy tariff fee

Written by on January 13, 2014 in Bulgaria - No comments

Bulgarian President Rossen Plevneliev has submitted a formal challenge to the country’s Constitutional Court, asking it to strike down the new fee on the feed-in tariff paid to solar and wind power electricity producers, the presidency’s media office said on January 13.

The 20 per cent fee was tabled in December 2013 as an amendment to the 2014 Budget Act before the second reading vote and was passed by Parliament. At the time, Plevneliev said it was yet another example of lack of transparency in Parliament.

Plevneliev’s challenge argued that the new fee breached the principles of free enterprise (by imposing the fee selectively on solar wind and power producers, rather than all renewable energy producers) and rule of law (by failing to observe the guidelines of the statute on lawmaking).

Additionally, the challenge argues that fees can only be imposed in exchange for a service rendered by the state – which is not the case in the current situation.

Although the proposal has been billed by the media as a 20 per cent tax on the revenue of renewable energy producers, the country’s Economy and Energy Ministry pointed out on December 2 that this was not in fact so.

Instead, solar and wind power producers would be asked to pay back 20 per cent of their preferential feed-in tariff as a fee, meaning that any electricity produced for own consumption, sold on the liberalised market or exported would not be subject to the fee, the ministry said.

The solar and wind power industry groups estimated that the amendment would raise – or save, depending how one looks at it – about 170 million leva for the Budget, but put many of the smaller renewable energy producers on the verge of defaulting on their bank loans.

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