Bulgaria’s government adopts plan for transition for coal-mining regions when production ends

Meeting in special session on September 29, Bulgaria’s government adopted Territorial Just Transition Plans for the country’s coal-mining regions, envisaging the mines being allowed up to operate up to the year 2038 and with strategies to attract investment and secure incomes as the country’s coal industry shuts down.

The plan is to be sent to the European Commission ahead of the September 30 deadline to do so, Prime Minister Nikolai Denkov told a joint news conference with Finance Minister Assen Vassilev.

The plan concerns a just transition after the closure of coal plants in Stara Zagora, Pernik and Kyustendil.

The Cabinet meeting took place against a background of the latest protests by coal and energy workers opposed to the eventual closure of the coal industry in Bulgaria. The protests caused serious traffic disruptions on some major motorways.

Denkov said that much of the demands of the protests were based on false and distorted information.

Referring to demands by unions to postpone the submission of the plan, he said that postponement was not possible because it would put Bulgaria at risk of losing 3.5 billion leva in funding.

There were no dates for closing specific coal plants, Denkov aid.

“Gradually, step by step, some of them will fall out of the energy system, simply because it will not be economically possible for them to function anymore,” he said.

That is why it was extremely important to create mechanisms by which people who have the necessary qualifications can find employment in the same region . “We are already working on this topic,” Denkov said.

The plan is that by the end of 2023, a state enterprise will be set up to transform the territories of the mines into industrial zones. This enterprise will not take away functions from the mines, but will complement them, according to the government.

“We expect modern companies that need qualified labour to appear there. We had to check what the interest is and it is extremely high”.

There will be social packages for people affected by the changes in the sector.

Finance Minister Vassilev said that if people from the sector wanted to leave it, they would be able to receive benefits equivalent to 36 months of salaries.

“Salaries in the mines are quite high, this means that such a package would be between 140 000 and 150 000 leva per person,” Vassilev said.

He said that the date of 2038 for Bulgaria to close its coal production had been set in energy legislation in 2019.

Vassilev said that through the plan and state co-financing, what was being done was to handle the transition so that people kept their incomes, no one fell into financial difficulties and sufficient investors are attracted to the regions.

Ahead of the Cabinet meeting, Denkov held talks with the heads of Bulgaria’s two trade union confederations.

Asked at the post-Cabinet briefing for details how the 36-month-salary compensation payment would be calculated, for instance by taking into account length of employment, Vassilev said that this was a matter for negotiation with the unions.

In Parliament, three minority opposition parties called on September 29 for the postponement of the submission of the plan. For years, left-wing and populist parties have insisted that the ending of coal production in Bulgaria would result in “thousands” of job losses and drive up costs for consumers.

The plan also was the subject of tensions within the ruling coalition earlier this week, after Boiko Borissov’s GERB accused We Continue the Change of pre-emptively listing companies who would benefit from the transition, with the implication that they had been listed because of allegedly being close to WCC.

Vassilev told the September 29 briefing that the companies listed were those who had expressed an interest in investing the regions, and the list had been compiled to assess how many jobs could be created.

As a consequence of the row, at the proposal of GERB-UDF and the Movement for Rights and Freedoms, a parliamentary sub-committee on overseeing the management of EU funds was upgraded to the status of a fully-fledged standing committee. The committee will monitor the distribution of more than 3.4 billion leva in the energy sector in line with the plans for a just transition.

(Photo: John Nyberg/sxc.hu)

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