site.btaNational Decarbonization Fund to Replace Energy Efficiency Fund, Parliament Decides

The National Assembly has passed at second reading amendments to the Energy Efficiency Act establishing a National Decarbonization Fund, which will replace the Energy Efficiency and Renewable Energy Sources Fund.

The new fund will serve as the main financial mechanism supporting the building stock in Bulgaria, providing financing for energy efficiency improvements and promoting the use of renewable energy in buildings. It will also function as a "one-stop shop" offering technical assistance and coordination of projects. 

Funding for the National Decarbonization Fund will come from donations by international financial institutions and funds, Bulgarian and foreign individuals and entities, interest income, loans and credit instruments, contributions from energy companies, EU programmes and mechanisms, public allocations, and revenues from the auctioning of greenhouse gas emission allowances, among other sources.

The new fund will inherit all assets, liabilities, archives, and obligations of the current Energy Efficiency Fund. Its management structure will include a Donors' Assembly, a Management Board, and a Fund Manager.

The governance will be two-tiered. The Donors' Assembly will represent contributors’ financial participation and oversee the fund’s operations. The Minister of Energy must convene the first meeting within 30 days of the law’s entry into force, at which members of the Management Board will be elected and operational rules adopted.

The Management Board will consist of nine members including four representatives of ministries, as well as members from government and non-governmental organizations. The Chair of the Management Board will be a representative of the Ministry of Energy, joined by the Executive Director of the Sustainable Energy Development Agency and a representative of the National Association of Municipalities in Bulgaria. The board members will serve five-year terms.

The board must appoint the fund’s first manager by April 30, 2026. The manager’s term will be five years, except for the first regularly elected manager, whose mandate will last three years. Until the appointment, the chair of the Management Board will perform the manager’s duties.