Legislative Revisions Envisage Producers of over 4 MW Electricity to Sell on Energy Exchange

Sofia, March 6 (BTA) - Parliamentary Energy Committee Chair Delyan Dobrev Tuesday said that energy producers making over 4MW of electricity under preferential conditions (power stations, cogeneration plants, thermal and hydroelectric power plants) will sell their energy on the energy exchange at freely negotiated prices. Dobrev was speaking during a discussion in Parliament on upcoming amendments to the Energy Act.

Thus far the law envisaged only the producers of over 5 MW of electricity to be selling on the energy exchange. The change is necessary because a very large number of producers make just under 5 MW of electricity in order to avoid the licensing procedure at the Energy and Water Regulatory Commission (EWRC), Dobrev explained. In this manner, the total amount of electricity to be sold on the free market will be over 4 TWh. Dobrev also said that the technological losses bought by the electricity distribution companies will no longer be received by the National Electricity Company (NEK) but will be bought on the energy exchange at freely negotiated prices.

Dobrev added that the upcoming revisions to the Energy Act have been coordinated with the recommendations of the World Bank, which proposes a change in the model of the Obligation to Society fee. The latter is planned to be collected by the Energy Security Fund, which will compensate NEK for the hydroelectric power plants producing under 4 MW of electricity. He noted that the upcoming amendments to the Energy Act, as a step towards the complete liberalization of the electricity market in Bulgaria, will not influence the final price of electricity.

EWRC head Ivan Ivanov said that the increase in the amount of electricity to be traded on the energy exchange should be accompanied by a thorough change in the EWRC's powers. He insisted that the regulator, in implementation of Regulation (EU) No. 1227/2011 on Wholesale Energy Market Integrity and Transparency (REMIT), should be delegated powers to investigate suspected market abuse in wholesale trade on the energy exchange in two areas: trade in internal information and price manipulation.

Outgoing Energy Minister Temenouzhka Petkova explained that the electricity market's full liberalization is aimed at achieving a market principle in pricing and competition, which would give consumers the opportunity to choose their electricity suppliers. According to Petkova, full liberalization requires an ever decreasing share of the regulated market, a process forecast to take Bulgaria around 5 years. In her words, one of the main emphases is to protect consumers experiencing energy poverty.

Source: Sofia