Bulgaria energy watchdog proposes cut in preferential purchase prices of wood biomass energy Bulgaria’s State Energy and Water Regulatory Commission (SEWRC) proposes a decrease in the preferential purchase prices of electric energy produced from wood biomass, it became clear at Thursday’s sitting of the institution, which was dedicated to a public discussion of a report on setting preferential prices of electric energy produced from renewable energy sources. The reason behind the proposal id the fact the price of wood, which is the main material of the power plants, dropped by about 10%, according to data presented by the Ministry of Agriculture and Food at the end of last year. If the proposal is approved, the end purchase price of electric energy produced under the technology of direct combustion will be BGN 49.13 per tonne, and the price of electric energy produced under the technology of thermal gasification will become BGN 78.60. These prices include the expenditures on baling the material used. The decrease in the preferential purchase prices of electric energy from power plants employing the technology of direct combustion of biomass will amount to 33.77% for the plants with up to 5 MW of biomass. The decrease will be some 32.49% for the plants of up to 5 MW that produce both heat and electricity and 34.22% for the plants of over 5 MW. Speaking during the discussion on the report of the SEWRC’s working group Andrey Bachvarov, chair of the Bulgarian Biomass Association, said all the power plants in the country included in the system at present did not represent more than 25 MW. In his words, the real expenditures of the plants exceed the expectations and all the expenditures on rendering them safe are such that each producer of electric energy would like the purchase prices to remain unchanged. According to him, there is some confusion in the society as the biomass power plants are constantly mistaken for RES power plants. He remarked the Bulgarian Biomass Association was currently recruiting people in Smolyan, was making investments and was attempting to provide heat for the town in practice for free. Nikolay Yalamov, manager of a firm, commented there were lapses in the report that had not been considered, there were also figures not corresponding to reality. He said further when the report was analysed the fact the prices presented by the Ministry of Agriculture and Food were the initial prices at wood auctions was neglected. In his view, the real price in real agreements could differ significantly. SEWRC members explained some things in the report and details on some prices were missing but they would be added. SEWRC Chairperson Svetla Todorova stated the producers of energy from biomass, and from wood waste in particular, took up a very small share from the RES energy. She commented their prices could not influence the average energy price.
Source: Standart (09.01.2015)

Arbitration case brought by Worley Parsons Services Nuclear against the National Electricity Company (NEK) is worth EUR 54 mln, Deputy Minister of Energy Anton Pavlov said to energy committee in parliament. The information was disclosed in connection with the discussion of the proposal for the resumption of construction of NPP Belene. The arbitration case was brought a little more than half a year ago. According to Bogomil Manchev, who is a major shareholder in Risk Engineering, former subcontractor of WorleyParsons as a consultant for the Belene project, the cause of the case is the unilateral termination of the contract for architect-engineer by NEK.
Source: Capital (19.01.2015)

Bulgaria Hopes to Revise Contracts with AES, ContourGlobal Units by end-March Bulgaria hopes to renegotiate by end-March its contracts with US-based AES Corporation and ContourGlobal for the purchase of electricity from their power plants AES Maritsa East 1 and ContourGlobal Maritsa East 3, Energy Minister Temenuzhka Petkova has said. Under contracts signed more than a decade ago Bulgaria's National Electricity Company has been purchasing electricity from the two thermal power plants at prices higher than the average market prices paid to other producers. Bulgaria's energy watchdog DKEVR in May 2014 sought changes to the contracts with the two power plants. AES owns a majority stake in Maritsa East 1, while ContourGlobal is majority owner of Maritsa East 3. Darik radio quoted Petkova as saying on Tuesday that urgent measures were needed to address the deficit at the National Electricity Company which exceeded BGN 3B. An audit was underway in the energy sector and checks were carried out in all energy companies, Petkova added. At present negotiations were being held with AES Corporation and ContourGlobal which have expressed support for the initiative of the Energy Ministry. Petkova expressed hope that a positive outcomes of the negotiations will become evident soon.
Source: Sega (21.01.2015)

Life Extension of Units 5, 6 of Kozloduy NPP Proceeds as Planned- Watchdog Chair The life extension of units 5 and 6 of the Kozloduy nuclear power plant proceeds according to plan, according to Lachezar Kostov, Chair of the Bulgarian Nuclear Regulatory Agency (BNRA). Kostov informed that the BNRA had received all necessary documents for the procedure by November 2014 and had approved the life extension of the two N-plant units. He said that parallel to that Worley Parsons was estimating whether the recommended measures were sufficient. Kostov noted that the contract with the consultant was worth around BGN 150 000. He made clear that Worley Parsons was expected to present its evaluation of the program by April 2015, adding that the life extension plans for the two N-plant units could include additional measures. Kostov said that the Kozloduy NPP could launch the implementation of the plan approved by the BNRA immediately. Borislav Stanimirov, Deputy Chair of BNRA, claimed that the life extension of the two N-plant units was a a purely technical question and there was no politics involved.
Source: Standart (22.01.2015)

Bulgaria's State Electricity Co 'Sells Energy Below Market Prices' State-owned National Electricity Company (NEK) is suffering losses worth millions of BGN due to "lobbyist" legislation amendments and a practice to sell electricity below market prices, a Bulgarian MP has claimed. In December 2014, NEK sold some 650 MW of energy, nearly 50% of Bulgaria's total annual export, at BGN 70-71 per MW, which is ten percent below market princes. Kadiev's estimates suggest NEK is running a BGN 30 M loss just from these activities. amendments to the Energy Act are forthcoming which include changes a "liabilities to society" tax of BGN 15/MW/h. The latter levy replaced in August the "green energy" tax introduced by the previous elected socialist-liberal government that was revoked by the Constitutional court in end-July. Kadiev alleged that the "lobbyist" amendment envisaged a cap on the new tax which would benefit bigger industrial consumers of energy, with the move depriving NEK of nearly BGN 40 M in revenues. "The loss... will be dispersed among households and will increase consumer [electricity] bills by BGN 1 a month," he argued. Electricity bills are set to go up in the next years, as energy watchdog officials maintain. At the same time NEK is actively exploring measures to tackle its massive debt worth about BGN 3 B (in an economy of about BGN 80 M), according to government estimates.
Source: Dnevnik (26.01.2015)

From 2016 all electricity to be sold on the Exchange There will be an energy exchange through which will undergo the whole amount of electricity, announced the Chairman of the Parliamentary Committee on Energy and MP Delian Dobrev and added that the stock exchange in Bulgaria will work on the Romanian model. The amendments to the Energy Act (EA), which is currently under discussion, envisages full liberalization of the electricity market in Bulgaria by 2016. According to Dobrev, from the beginning of next year there will be no energy mix sold by the National Energy Company (NEK) but preferential prices and a fund to cover the cost of green energy.
Source: Standart (06.02.2015)

US-Owned TPPs Agree to Cut their Electricity Prices Bulgaria's National Electric Company (NEK) has signed memorandums with each of the two US-owned coal-fired electric power plants in the Maritsa Basin, AES Maritza East 1 and ContourGlobal Maritsa East 3, under which the long-term agreements on purchase of the electricity generated by the plants will be renegotiated and its price will be reduced, Energy Minister Temenouzhka told a news conference here on Friday. For its part, NEK guaranteed that it will pay its overdue debts to the two power plants. "We hope that the renegotiation on the terms and conditions for the long-term purchase of the electricity produced by the plants will be finalized by the end of March 2015," Petkova said.
Source: Standart (23.02.2015)

Bulgarian co Chimco up for sale at starting 11.7 mln euro The assets of insolvent Bulgarian fertiliser plant Chimco have been put up for sale again, this time at a starting price of BGN 22.8 million. Bids for the fertiliser's properties, buildings, and production facilities can be submitted until March 6, newspaper Capital Daily reported. The plant was put up for sale in the first quarter of 2014 at a starting price of nearly BGN 29 million, without attracting investor interest at the time. According to the daily, despite the lower price, Chimco's assets are amortised and their purchase would not prove lucrative, hence they will probably not attract investors on this occasion either. It also said that Chimco, which was declared insolvent in mid-2012, has about BGN 81 million in debts, mainly to state-operated electricity company NEK and gas monopoly Bulgargaz.
Source: Monitor (23.02.2015)

BG market faces significant electricity price hike from 2016 due to market liberalization Despite the accumulated deficit in the National Electric Company there will be no significant rise in the electricity prices from July 1 this year, the Bulgarian regulator's representative Evgenia Haritonova informed. 2016, on the other hand, will bring a serious price hike due to the deregulation of the electricity markets. Haritanova refused to predict how much the current prices will jump in this summer, saying that the first estimates of the EDCs will be submitted to the Commission by 31 March. The significant jump in the electricity prices is expected next year due to the full liberalization of the market from 1 January 2016. The prices for households users, however, will remain regulated until June 30, 2016.
Source: Standart (26.02.2015)

S&P downgrades Bulgaria's NEK to B Standard&Poor's Ratings Services (S&P) lowered Bulgarian power utility National Electricity Company’s (NEK) long-term corporate credit rating to B+ from BB- and has removed it from CreditWatch. The outlook on NEK remains negative, S&P said in a statement last week. “The rating action follows the completion of our review of our assessments of NEK's stand-alone credit profile (SACP) and BEH's group credit profile (GCP), taking into account our expectations for full-year 2014 results and the Bulgarian government's announced reforms to the country's ailing power sector,” the agency said. NEK is a fully-owned subsidiary of state-run Bulgarian Energy Holding (BEH).
Source: Capital (06.03.2015)

Bankrupt Fertilizer Plant Chimco AD Fails to Attract Bidders in Second Tender No candidates to buy the bankrupt Vratsa-based fertilizer plant Chimco AD, also known as Himko AD, showed up in the second open tender. The price tag, at BGN 22.8 M, had been reduced by slightly over BGN 6 M from the previous tender held in 2014, according to reports of the Bulgarian Telegraph Agency. The bid increment had been set at BGN 1 M. The liquidator, Rositsa Tomova, announced that the tender had been held valid, despite the fact that no bidders had participated. She made clear that the creditors were to decide on the date of the next tender and the manner in which it would be organized. Tomova informed that the decision was to be taken at a general meeting of creditors to be assigned and to be held at the Vratsa District Court. The largest creditors of Chimco are state-owned gas supplier Bulgargaz, the National Electric Company (NEK), and the National Revenue Agency (NRA). The first tender for the sale of Chimco was held in the spring of 2014 and no participants showed up. Then-Economy Minister Dragomir Stoynev had included Chimco in the plan of the government for the reindustrialization of the Bulgarian economy, the idea being that the state would buy the plant and stabilize it and then sell it to a foreign investor. However, the Economy Ministry did not take part in the first tender as the price was considered to be too high.
Source: Capital (09.03.2015)

Pleven Heating Utility’s debts to Bulgargaz reached BGN 50 million Pleven Heating Utility’s debts to Bulgargaz have accelerated by BGN 27.994 million in 2014. In that way the company’s overall debt to the national gas distributor has reached BGN 50 million. The heating utility’s business plan for the present year says that money owed to Bulgargaz has to be covered by direct payments made by National Electrical Company for the power it gets from the company. Due to NEC’s bad financial state, part of these transfers are retarded which finally affects Bulgargaz. The largest heating utility in the country, the one based in Sofia also has BGN 20 million current obligations to Bulgargaz. For the period 2015-2019 Pleven Heating Utility has envisaged BGN 13.610 million investments, which is by BGN 8 million less as compared to the preceding four-year period. Money will be used mostly for projects focused on reduction of production costs. Repair work will take up another BGN 12.704 million. The company plans growth in generated electrical energy by 7% annually.
Source: Capital (11.03.2015)

Bulgaria’s National Electric Company Spends Most on Green Electricity Bulgaria’s National Electric Company (NEK) spends the most on renewable energy and the least on electricity produced by the Kozloduy Nuclear Power Plant (NPP), according to Petar Iliev, Executive Director of NEK. Iliev appeared Wednesday at a hearing before the ad hoc parliamentary committee on establishing the current situation in the energy sector. Iliev made clear that 3% of NEK’s expenses went to the cheapest electricity generated by the Kozloduy NPP, while renewable energy plants accounted for a share of 26% of the company’s spending. He pointed out that the deficit at NEK increased further due to the obligation of the company to buy all the electricity produced by certain power plants, regardless of the fact that in some cases the output exceeded the quotas set by the energy watchdog. Iliev, as cited by the Bulgarian National Radio (BNR), condemned the quotas as unrealistic, stressing that in some cases overproduction amounted to 74% and the surplus had to be bought at preferential tariffs. He noted that the situation in the energy sector was expected to improve as a result of Energy Act amendments adopted by Parliament recently under which NEK was to buy electricity from factory power plants and thermal power plants only if the output was high-efficiency electricity and did not exceed the quotas set by the energy watchdog. Iliev argued that a potential new increase in electricity prices in July would be immoral. He specified that the price of electricity on the free market was BGN 70/MWh, while household consumers, who were supposed to be protected consumers, paid BGN 125/MWh on the regulated market.
Source: National radio (12.03.2015)

The plant for tires of the largest Vidin-based company Vidachim stopped work indefinitely. The company’s office refused information on the case, but workers said that layoffs are to start. The tire plant will release the current 50-60 people. The factory for tires and the TPP employ a total of 500 people. Since the plant operates only with Ukrainian coal, in recent months it has difficulties with the supply. Since the beginning of the hostilities in that country, their supplies are irregular. NEK also owes Vidachim. Currently the plant continues to operate. There is no notification of upcoming layoffs in the chemical company, announced Milcho Tzokov - head of the labor office in Vidin.
Source: Standart (13.03.2015)

Bulgarian Car Tyre Maker Vidachim Axes 314 Workers Over 300 employees of Bulgaria’s Vidin-based car tyre maker Vidachim will be unemployed as of Monday. Vidachim, one of the largest companies in Bulgaria’s poorest northwestern region, will issue redundancy notices to 314 of its 446 workers amid a lack of orders. The company is resorting to staff cuts because it cannot provide work for its employees and pay their salaries and social security contributions. Milcho Tsokov, head of the Vidin-based employment office, said that the chance of the axed Vidachim workers to find jobs immediately was negligible. The Vidin-based car tyre maker has implemented staff cuts in the past four months, downsizing its headcount by nearly 100 people. According to the local unit of the General Labor Inspectorate, the January salaries of Vidachim workers have been paid.
Source: Duma (16.03.2015)

Fitch downgrades Bulgarian Energy Holding to 'BB', places on RWN Fitch Ratings said it has downgraded Bulgarian Energy Holding's (BEH) long-term foreign and local currency issuer default ratings (IDR) and its foreign currency senior unsecured rating to 'BB' from 'BB+', and placed the ratings on rating watch negative (RWN). "The rating downgrade reflects a substantial deterioration of BEH group's credit metrics driven by a wider tariff deficit at its subsidiary Natsionalna Elektricheska Kompania EAD (NEK) amid an unfavourable regulatory and market environment," the ratings agency said in a statement on Wednesday. Fitch Ratings also said in its statement: "The RWN reflects the risk of a further rating downgrade if NEK's and BEH group's financial results fail to materially improve in 2015-2016 from weak 2014 preliminary levels. The speed and scale of results improvement depends on the implementation of planned regulatory and legislative changes as well as on NEK's long-term power purchase agreements renegotiation. We expect a deterioration of the BEH group's liquidity in 2015 due to working capital outflow projected by Fitch, which together with capex will result in negative free cash flow (FCF). Based on preliminary numbers for 2014, BEH expects to meet a debt incurrence covenant, as defined in the EUR500m eurobond documentation, albeit with limited headroom. In our view, failure to meet the eurobond covenant resulting in limitation to raise debt would substantially worsen BEH group's liquidity position.
Source: Dnevnik (20.03.2015)

Bulgaria grid operator inks landmark changes to contracts with American TPPs Bulgaria’s National Electricity Company (NEK) inked an agreement on changes to the long-term contracts with TPP AES Maritsa Iztok 1 and TPP Kontur Global Maritsa Iztok 3 on Wednesday. The papers were signed by Executive Director of the National Electricity Company (NEK) Petar Iliev; Chief Commercial Officer of AES Bulgaria Ivan Tsankov; and Garry Levesley, Chief Executive Officer of TPP Kontur Global Maritsa Iztok 3. The signing ceremony was attended by f Bulgarian Prime Minister Boyko Borisov and Minister of Energy Temenuzhka Petkova. “We agreed on cutting the price of available electricity, which the National Electricity Company (NEK) is obliged to purchase during the entire period of the contracts. The total decrease, which we managed to agree on, is 30% for both contracts,” Bulgarian Minister of Energy Temenuzhka Petkoca said after the signing ceremony. “This is a serious step forwards in the attempt to save the energy sector from the financial collapse it finds itself in. The price cut is not bound to extension of the deadlines of the contracts,” the minister explained. “The general effect, which we expect the NEK to realise until the expiration of the contracts, is around BGN 1 billion, or in other words the company will manage to save around BGN 100 million a year as a result of the renegotiation of the contracts,” Temenuzhka Petkova said further. She added that NEK agreed to pay off its debts to the American partners. “Today is one of the important days for the Bulgarian energy sector because the need of looking for options for revision of the long-term contracts with the American partners has been discussed for two years. Our government managed to renegotiate the conditions in the contracts in just a few months,” the minister remarked. “Currently the National Electricity Company (NEK) owes around BGN 700 million to the two American plants,” Temenuzhka Petkova said. “One of the debts is of BGN 300 million to TPP Kontur Global Maritsa Iztok 3 and the other – BGN 388 million to the TPP AES Maritsa Iztok 1,” the minister remarked. “Things should happen by the end of June. NEK does not have any resource to pay off these debts. What we achieved with the American partners is connected with decrease of the availability price. I do not want anyone to expect that this will affect the electricity price. This will allow NEK cut the deficit and keep the price in some way,” Minister Petkova said further. “We will secure a credit that will allow us to pay off the debts owed to the two American power plants,” Minister Temenuzhka Petkoca said. “Today’s agreement will come into force by June 30. The loan in question has nothing to do with the BGN 16 billion state debt. This will be a credit which the Bulgarian Energy Holding (BEH) will take to make it possible for NEK to pay its debts,” the minister explained. “We had the vision that Bulgaria will be the Switzerland of the Balkans,” said Julian Nebreda, AES Corporation President for Europe. “The country has much potential and opportunities. Electricity will be one of these competitive advantages. We believe that this is a positive step and it requires much of work in the future. The negotiations were hard but we reached an agreement because we place trust in the government of this prime minister, and namely – that it will stabilise the sector,” Nebreda remarked. He commented that while signing the contract the company was certain that the government would successfully implement its programme and that there would a stable energy sector soon. “This will be one of the engines that will give a push to Bulgaria for becoming Switzerland of the Balkans,” Julian Nebreda remarked. “I am happy that I witnessed the signing of this agreement,” US Ambassador to Bulgaria Marcie Ries said. “These two companies together make the biggest American investment in Bulgaria. We hope that the signing of these agreements will contribute to the establishment of positive image for the business environment in the country and will attract more American investors in Bulgaria,” the Ambassador remarked.
Source: Duma (09.04.2015)

Bulgaria's Mini Maritsa Iztok gets 25.6 mln euro loan Bulgarian coal mining complex Mini Maritsa Iztok has signed a BGN 50 million loan agreement with two banks, local media reported. The coal mining company will use the proceeds from the loan to partly cover its debts to suppliers, state-owned Bulgarian National Radio reported on Tuesday, quoting Mini Maritsa Iztok's executive director Andon Andonov. Under the agreement, the loan will be repaid by the state-owned Maritsa Iztok 2 thermal power plant (TPP) which in turn owes the coal mining company BGN 59.2 million. According to Andonov, the Bulgarian units of US companies AES and ContourGlobal owe Mini Maritsa Iztok a total of BGN 206 million, and local power producer Brikel owes it a further BGN 47 million. AES operates the Maritsa Iztok 1 coal-fired plant in Galabovo and ContourGlobal operates the Maritsa Iztok 3 TPP. Earlier this month the two companies agreed with state-owned power utility NEK on a decrease by 14% and 17%, respectively, in the capacity price for electricity produced by their coal-fired plants in the southeast of the country. For its part, NEK will pay all arrears to the two companies amounting to a total of BGN 700 million. These agreements, however, have no bearing on the US companies' debt to Mini Maritsa Iztok, Andonov said.
Source: mediapool.bg (15.04.2015)

Bulgaria's NPP Kolzoduy to sell power online NPP Kozloduy intends to introduce an online platform for the sale of its power, which is “developed with own funds and resources”. In January this was done by Maritsa East 2 TPP, which was the first to begin using this trade mechanism, while the National Electricity Company (NEK) took advantage of the bilateral agreement practice in end-2014. It would seem that state companies have started to orient towards growingly flexible mechanisms for sale, such as the online trade of power. The changes are dictated by the further liberalisation of the power market and the necessity for participants to be as adequate to the new market conditions as possible in spite of the lack of an energy exchange.
Source: Capital (20.04.2015)

Bulgarian Energy Holding Reports Declining Income, Profit in 2014 The operating income of the Bulgarian Energy Holding (BEH) EAD dived by 64.16 per cent in 2014 from 2013, and the profit before tax plummeted from BGN 414.8 mln to BGN 285.9 mln, according to the company's Annual Report for 2014 that has been published. On March 20, 2015,Fitch Ratings downgraded BEH's long-term foreign and local currency issuer default ratings (IDR) and its foreign currency senior unsecured rating one level to 'BB' from 'BB+' and placed the ratings on rating watch negative (RWN), the report recalls. "The rating downgrade reflects a substantial deterioration of BEH group's credit metrics driven by a wider tariff deficit at its subsidiary Natsionalna Elektricheska Kompania EAD (NEK) amid an unfavourable regulatory and market environment," the ratings agency said. Fitch views the Bulgarian regulatory environment as less developed and far less predictable than in western Europe. "Several legislative and regulatory changes aimed at narrowing NEK's deficit are planned by the government, parliament and the regulatory office for 2015, but may be subject to delays or may yield lower-than-expected positive impact as happened in 2014 with some planned changes." A substantial narrowing of NEK's deficit and increased predictability of cash flows at BEH group could lead to a positive rating action, the report points out. The company's principal sources of income are dividends received, interest received on loans extended to subsidiaries, and services provided to subsidiaries in financial management, project management, corporate governance and business planning, legal and regulatory matters, public relations and communications.
Source: econ.bg (11.05.2015)

Bulgargaz and Bulgartransgaz held over 25% of their money in CCB The total amount of cash in the CCB of the Bulgarian Energy Holding (BEH) and its subsidiaries amounted to BGN 132.839 million, said Minister of Energy Temenuzhka Petkova. "In particular, the holding’s current accounts in CCB amounted to BGN 44.073 million at the time of placing the bank under special supervision. On June 20, 2014 NPP Kozloduy had cash in the CCB of over BGN 4 million. The requirement for a net concentration is observed as of June 30, 2014. NEK had BGN 14 million in CCB. The company has a contract with the bank following a procedure of public procurement law. Minister Petkova pointed out that the choice of bank is approved by resolution of the Board of Directors. Cash of ESO in the bank amounted to over BGN 3 million.
Source: Presa (27.05.2015)

25% of BEH put on the BSE Bulgaria will offer 20-25% of the shares of Bulgarian Energy Holding (BEH) on the capital markets, Deputy Energy Minister Nikolay Nikolov announced. This will happen after stabilization of the holding, which will facilitate the liberalization of the market, he said. Following the liberalization, BEH subsidiaries will improve their financial results, will refinance their obligations, and through sales of shares will fund modernizations, Nikolov said. Meanwhile, BEH is about to take BGN 800 million government guaranteed loan, Deputy Minister Nikolov said. It will be used to pay the obligations of the BEH’s subsidiary NEK to both US TPPs in the Maritza Iztok complex.
Source: Standart (27.05.2015)

NEK obligations to the two US plants in Maritsa - Iztok grows within the hours, CEO of BEH Jaklin Cohen said during a parliament hearing on the energy situation. Cohen said he led tough negotiations with the plants for final signing of the contracts with which to reduce the cost of availability, which NEK pays. The effect of this measure will save BGN 1 billion for the remaining 10 years of the contract, or BGN 100 million per year. The condition to reduce the price is the payment of NEK’s debt to two companies - AES Galabovo Maritsa East 1 and Contour Global Maritsa East 3. Initially it was announced to be 700 million. Yesterday, Deputy Minister of Energy Nikolay Nikolov said the debt is BGN 800 million and that Bulgarian Energy Holding seeks to draw government loan to be repay the obligations.
Source: Dnevnik (28.05.2015)

Heavy industry insists concessions in the price of electricity to be fact until July Looming increase in electricity prices from July 1 by an average of 1.9% for households and 22% for business consumers becomes more and more of a worry to the heavy industry, which for years insisted on concessions in the price. Reason is that the ordinance, which should enable the introduction of discounts for large energy consumers, is not yet ready. Under the amended Energy Act, adopted in early March, that order had to be drawn up jointly by the Ministries of Energy, Finance and Economy within 6 months from the entry into force of the amendments. It must determine the mechanism by which to apply the facilitated regime. According to experts the idea of concessions is to benefit mainly large metallurgical enterprises, which due to their very nature, are among the most energy-intensive industries despite introduced energy efficiency measures. As a result for them the resolve for in the price of energy to be finalized by July 1 is vital, as then the regulator should define the new electricity prices for the next year.
Source: Capital (04.06.2015)

Businesses want resignations because of the price of electricity BICA, BIA and the CEIBG demand an urgent meeting with Prime Minister Boyko Borisov regarding the price of electricity. The three national representative organizations report that they will demand the resignation of Energy Minister Temenuzhka Petkova and President of KEVR Ivan Ivanov, if no measures are taken for the introduction of European pricing of electricity. "In addition to our protests against the planned rise in electricity from July 1 - between 13% and 20% for the majority of active enterprises in Bulgaria and between 4% and 13% for the largest energy intensive production – we again categorically insist that Bulgaria implement EU policies and best practices in the energy sector," the organizations wrote in a letter to PM Borisov. The refusal of reforms in the energy sector and the decision all accumulated imbalances to be paid by local businesses are the main reason that makes BICA, BIA and the CEIBG request the two resignations. The business organizations point out that the decision has been taken without an impact assessment on the economy from the increase in the price of electricity for business use, as required by European directives. The three organizations will approach the prosecution for inspections on how were signed long-term contracts for power purchase, are received preferences for renewable energy eligible and whether the production of cogeneration is high-effective.
Source: Standart (16.06.2015)

BG factories to oppose 20% electricity price hike from July 1 with strike The decision of the State Energy and Water Regulatory Commission / KEVR / to increase electricity prices by up to 20% from July 1 is truly angering local producers. As a result, four employers' organizations have announced a one -hour protest strike on June 26. According to the industrial employers, the intent of the Energy Ministry to partially offset electricity costs for about 30 enterprises that have an electricity consumption over 30 GWh per annum does not solve the problems in the sector which have been accumulating for years. Our questions were left unanswered, said CEIBG BICA, BIA and BCCI in a declaration. The production will be suspended for one hour in the enterprises that are members of the Confederation of Employers and Industrialists in Bulgaria / KRIB / Association of Industrial Capital in Bulgaria / BICA / Bulgarian Industrial Association / BIA / and Bulgarian Chamber of Commerce and Industry / BCCI /. The only exceptions are those with a continuous production cycle. Although employers' organizations recently issued a position on the appreciation of the current for business, they say that many of their questions stayed unanswered. One of them is why the amount of the fixed (respectively regulated by KEVR) final price of electricity in the country is among the highest ones in Europe. The data indicate that the fixed price is only higher in Denmark - yet compared to all others Bulgarian fixed industrial electricity prices are between 2 and 8 times higher. According to the business organizations the other main unanswered question is about green energy. They ask why the "green energy" supplement was raised by 43.4% (from BGN 11.1 / MWh. to 15, 92 lev / MWh.)
Source: Standart (22.06.2015)

Bulgaria utilities regulator postpones electricity price hike Bulgaria’s Energy and Water Regulatory Commission (EWRC) said on June 29 that it has decided to postpone the implementation of a new electricity pricing formula by one month to August 1. The decision comes against a backdrop of opposition from large industrial consumers, who have opposed the sharp hike in the “social responsibility” fee – introduced in 2013 to replace renewable energy and power grid loss surcharges – from 18.9 leva/MWh to 40.2 leva/MWh, which would result in a 20 per cent hike in the electricity bills paid by industrial consumers, according to the estimates from the companies affected by it. The one-month delay will give the Cabinet, which asked earlier for the price hike postponement, additional time that it should use to “find reserves to optimise expenditures”. The government is expected to publish new regulations in July, which would lessen some of the impact of the higher “social responsibility” fee on industrial consumers. Last week, during a hearing in Parliament, the regulator’s recently-appointed chief Ivan Ivanov said that the new pricing formula would create enough savings and additional revenue for state electric utility NEK to break even and stop accumulating debt. The sharp increase in the number of renewable energy producers over the past several years, spurred by the generous feed-in tariff approved by the government, is often blamed for the poor state of NEK’s finances because the state utility is required by law to buy all such electricity despite it being more expensive than electricity from older coal-powered plants.
Source: Standart (30.06.2015)

Lukoil is ¹1 in the ranking of the largest companies Lukoil Neftochim Burgas topped the list of Capital of the 100 largest Bulgarian companies again this year. Revenues of the refinery in 2014 is BGN 6.5 billion. Second is Aurubis Bulgaria with BGN 4.1 billion and commercial company Lukoil Bulgaria is third with BGN 3.2 billion revenue. The first four places (the fourth is NEK) ranking of companies is the same as in 2013, with the difference that the income of the four companies were higher than in 2014. The results show that the 100 largest companies in the country have total revenue of BGN 58 billion, which is 20% of all declared business turnover in 2014. Despite economic growth of 1.7% for the year, the revenues of big business decline. Debut among the top 10 companies in the ranking makes the NPP Kozloduy, which rose from 14th to 10th position. Other companies in the top 10 were Bulgargaz, CEZ Electro Bulgaria, OMV Bulgaria, Kaufland Bulgaria and Saksa.
Source: Standart (02.07.2015)

Bosch sold its photovoltaic parks in Bulgaria for EUR 10 million Bosch solar energy, a property of the German giant Bosch succeeded in selling its five photovoltaic parks, which until recently it had in Bulgaria. Their total installed capacity is nearly 25 megawatts. The buyer is the manager of the company’s subsidiary in Bulgaria, called BCI Kazanlak holding, Nedko Mladenov. His company is managing the projects located near the unanimous town. The deal took place in April 2015. The value of the acquired shares is symbolic. A loan to the amount of EUR 10 million has been drawn by Investbank. As collateral the company was pledged to the bank at the end of May. Five solar parks are connected to the July 2, 2012 the power of each of the projects is 4.98 megawatts. Bosch solar energy is producer of solar panels and has subsidiaries in Australia, India, and the US. The bough business has annual turnover of slightly over BGN 8 million. Tangible fixed assets in each of the five companies were valued at BGN 14 million, i.e. a total of BGN 70 mln.
Source: Capital (13.07.2015)

NPP Kozloduy lost its long-term sales due to ambiguity in electricity prices Due to ambiguity around electricity prices NPP Kozloduy has lost part of its long-term contracts for sale of electric energy. At the same time NEC began to delay payment of its debts to the power plant and do not repay the amount indicated in the repayment plan between the two companies. Nearly BGN 40 million, which NPP Kozloduy will have to submit in future fund "Security" of the power system, the plant hopes to find by optimizing its work. All conventional plants that will pay 5% of its turnover in the fund will actually calculate this cost in the price at which they sell energy on the open market and thus, in the chain, this cost will reach the final cost to consumers.
Source: Duma (13.07.2015)

Maritza East 1 Electricity Price Cut Approved by Creditors An arrangement between the National Electricity Company (NEK) and the AES Maritza East 1 Thermal Power Plant to modify the agreement under which the plant sells its electricity was approved by the energy regulator and by all 24 European and Bulgarian banks which are creditors to AES Maritza East 1, as well as by the European Bank for Reconstruction and Development, the World Bank and the export credit agencies of France and Germany, the plant said in a press release on Monday. The arrangement, concluded on April 8, entails an immediate reduction of NEK's expenses, the plant's CEO Olivier Marquette said. The change consists in reducing the availability price charged by Maritza East 1 by 14 per cent as soon as the plant collects all its overdue receivables. This will save NEK around 50 million leva annually, or 550 million leva until the sale agreement expires in 2026, the press release said. Marquette was quoted as saying that the reduction of the price charged by the plant, along with a legislative package aimed at stabilizing NEK financially, are the right steps forward in addressing the difficulties in the Bulgarian electricity sector. According to him, the electricity sale agreement is not an obstacle to liberalizing the national electricity market, because European practice shows that such a formula is successful on many markets. Marquette said Maritza East 1 is part of the solution to the problems of the electricity sector and will continue to support the government's desire for deep and massive reforms.
Source: Dnevnik (14.07.2015)

A Bulgarian Parliament commitee has adopted changes to the Energy Act meant to reduce chronic financial deficits at the state-owned National Electricity Company (NEK). The changes approved on second and final reading by the Energy Committee on Monday call for the creation of a Electricity System Security Fund. Producers and importers of electricity will make monthly contributions into the new fund equal to 5% of their sales revenue. Another change provides for cutting the expenses of NEK by capping the purchases of electricity from renewable sources at preferential prices at volumes agreed in advance between NEK and the renewable operators.The Parliament is expected to vote on the changes to the Energy Act on Wednesday. If approved, they could take effect from next month.
Source: Darik Radio (21.07.2015)

Parliament Establishes Electricity System Security Fund Parliament Wednesday established an Electricity System Security Fund by voting some amendments to the Energy Act on second reading. The financial resources in the Fund will be used to offset the shortage of financing in the National Electric Company (NEK) for purchase of electricity under the long-term agreements with renewable source power plants, high efficiency cogeneration of power and heat, and the two US-owned TPPs in the Maritsa East basin. Payments to the public supplier will be on a monthly basis. The chairperson will be nominated by the Minister of Energy, and the Environment and Water Minister and the Finance Minister will nominate one member each. The Fund is to raise 5 per cent contributions on the monthly revenues of all energy producers. The proceeds from the sale of greenhouse gas allowances will also go into the Fund. The funds will be used to maintain the operation of the Fund and to offset the costs of the public supplier. The monthly 5 per cent contributions will be based on electric power producer revenues from sold electricity (VAT excluded); as well as of importers of electric power for the domestic market (VAT excluded). MP Ramadan Atalai of the Movement for Rights and Freedoms said they were concerned this Fund could prove anti-constitutional. He recalled that NEK's deficit stands at 70 million leva for this month alone in which the new electricity prices were put off. MP Delyan Dobrev of GERB pointed out that currently obligations to the public go to NEK because that is the figure of the public supplier. When the market is liberalized NEK will no longer be public supplier and will not collect these revenues from obligations to the public. They will be collected by the Fund and will be paid to all producers who, for one reason or another, have preferential prices.
Source: Monitor (23.07.2015)

Bulgaria’s Maritsa Iztok 2 Thermal Power Plant Reports BGN 28.6 M Net Loss in H1, 2015 State-owned thermal power plant Maritsa Iztok 2 closed the first half of 2015 at a net loss of BGN 28.634 M, compared to a profit of BGN 1.440 M for H1, 2014, according to a report of the company. Although the company registered a profit of BGN 5.186 M for the first quarter of 2015, it warned that its financial result was going to deteriorate due to the decrease in revenues from services to the Electricity System Operator (ESO) such as the cold reserve, according to dnevnik.bg. The main reasons for the downward trend in H1, 2015 are said to be the increased greenhouse gas emissions costs, which the energy watchdog did not include in the calculation of the price for the past 1-year pricing period, and the decrease in revenues from sales of cold reserve quantities. The revenues of the state-owned thermal power plant go up by nearly BGN 10 M in H1, 2015. However, the emission quota costs increased by nearly BGN 19 M and depreciation expenses went up by around 6 M. The total expenses of the company added BGN 28 M in H1, 2015. The net financial expenses increased from nearly BGN 3 M to BGN 16.711 M. At the same time, state-owned Maritsa Iztok Mines closed the fist half of the year at a net profit of BGN 28.063 M, according to the H1, 2015 financial statement of the coal mining company. The profit of the Maritsa Iztok Mines for 2014 stood at BGN 4.340 M. The main reason for the positive development was the increase in sales revenues by nearly BGN 90 M to BGN 296 M.
Source: Capital (05.08.2015)

Bulgaria's NPP Kozloduy H1 net profit jumps 46% The operator of Bulgaria's sole nuclear power plant (NPP) Kozloduy said its net profit rose 46% to BGN 67.4 million in the first half of 2015. Total revenues edged up 0.17% on the year to nearly BGN 424.6 million through June while electricity-related revenues decreased by 0.4% to some BGN 413.3 million, the NPP operator said in a financial report. The company’s operating expenses stood at 349.8 million levs through June, up 2% compared to the first half of 2014. Kozloduy’s own investments for the period totaled BGN 40.3 million compared to BGN 53 million worth of investments in the first six months of last year. Kozloduy NPP, a subsidiary of state-operated Bulgarian Energy Holding, remained with two operational reactors - Units 5 and 6 - of 1,000 MW each after the country closed down four units of 440 MW each to address nuclear safety concerns of the European Union prior to its accession to the bloc. Bulgaria joined the EU in 2007. In April 2012, the government in Sofia decided to add another 1,000 MW unit to the plant. The NPP's planned Unit 7 is seen operational after 2025 due to the project's long synchronisation procedures, the country's electricity transmission system operator said in March.
Source: Capital (06.08.2015)

World Bank to Audit Bulgaria’s Energy Market Prior to Full Liberalization The World Bank will draft a comprehensive review of the financial state of Bulgaria’s energy sector and identify steps towards full liberalization of the electricity market by the end of the year under a deal signed on Friday. The Bulgarian Energy Holding (BEH) signed a consultancy services contract with the World Bank in Sofia, under which the World Bank will make a financial analysis of the sector, 3e-news.net reported. The value of the deal was not disclosed. World Bank experts will analyse in particular the financial state of the state-run National Electricity Company NEK, which has been persistenly plagued by deficits.The analysis will serve as the basis for choosing a model for a Bulgarian energy exchange, Energy Minister Temenuzhka Petkova explained at a news conference following the signing of the deal. Finding a compensation mechanism that will prevent the accumulation of deficits at NEK at the opening of the energy exchange will be a key part of the assignment. By November the government should be ready to introduce changes to the Energy Law that will provide the legal basis for the complete liberalization of the electricity market. A target date for the liberalization to take place is early 2016, Petkova said. Looking ahead, BEH CEO Jacklen Cohen commented they have the ambition to achieve the liberalization of the market in a very short time span. “The next step after the liberalization will be to connect our market to the already existing markets,” Cohen said
Source: investor.bg (10.08.2015)

AES and ContourGlobal thermal power plants and renewable energy producers will remain the primary sources on our energy market, recent data show. The latest data of energy watchdog KEVR show that AES Maritsa East 1 and ContourGlobal Maritsa East 3 set their share in Bulgaria's energy system at 20% and 25.2%, respectively. Renewable energy sources, which currently produce the most expensive energy (and which have been purchased under preferential conditions since the government passed laws to this end in early 2010) form 18.8% of the market. State-owned Maritsa Iztok 2 TPP and Kozloduy NPP have seen a substantial decrease in their respective shares, which now stand at 4.1% and 6.7%. This comes right after the government issued a statement that it would be bringing Maritsa Iztok 2 out of the regulated market. The rest of the energy is generated by heating utilities (16.3%) and the hydropower plant owned by the National Electricity Company (8.75%). Bulgaria is trying to tackle the BGN 3.7 billion debt of the NEC through a number of measures, including an increase in power prices for businesses, as well as to gradually move toward energy market liberalization.
Source: Capital (11.08.2015)

Bulgaria to forego dividend from state energy holding Bulgaria’s Energy Ministry will not seek any dividend from the Bulgarian Energy Holding (BEH) for 2014, using the money instead to bolster the group’s equity capital as it seeks to borrow money to pay back debts owed by its electric utility subsidiary to two power plants owned by US private investors, reports in Bulgarian media said on August 12, citing filings with the country’s trade register. According to the reports, the ministry was due to receive 239.5 million leva, or about 122.4 million euro, in dividend from BEH, the umbrella structure set up by Bulgarian government in 2008 to consolidate state-owned companies in the energy industry. BEH is currently seeking to borrow at least 800 million leva for its subsidiary NEK, the state electric utility, which needs the money to pay back the debts owed to AES Maritsa Iztok 1 and ContourGlobal Maritsa Iztok 3 power plants as part of an agreement under which the two coal-powered plants would reduce the price at which they sell electricity to NEK. (sofia globe)
Source: Sega (13.08.2015)

NEC restarts project for Yadenitsa dam After 10 years of interruption, NEC again began with the construction of dam Yadenitsa that may significantly increase the capacity of the operation the largest countervailing facility in Southeast Europe - PSPP Chaira. In the middle of last week, the state company announced a contract update of the detailed design and preparation of technical documents for the award of construction works for the construction of the dam Yadenitsa. The procedure includes a second stage, which provides exercise of supervision during the construction and preparation of project operation. The value of the contract is BGN 3.57 million. 50% of the funds for the overall completion of the dam Yadenitsa will be financed by European funds. In April this year, the Agreement between NEC and the Executive Agency Innovation and Networks at the European Commission came into force by which EUR 3.213 million for the renovation costs of the assessment of environmental impact (EIA) of the project was allocated and thus a permit for construction of the dam was rendered. The winner must provide a bank guarantee for performance of the contract to the amount of 2% of its value, or BGN 70 thousand, while at the same time will receive a 15% advance payment. The deadline for submission of bids is September 25th, and they will be opened on September 28 in the building of the NEC.
Source: Capital (17.08.2015)

Mines Maritsa Iztok will ask for a loan of BGN 50 million from Bulgarian Development bank Mines Maritsa Iztok is looking for a chance for a fast loan to the amount of BGN 50 million with direct negotiations. We have been analyzing banks, and it turned out that the only one that may give us money now at the fastest way is Bulgarian Development bank. The money will be purposely directed solely to paying off our obligations to the state and the companies we are working with, Mines Maritsa Iztok’s CEO engineer Andon Andonov said at a press conference on Monday. The state company looks for a bridge funding for BGN 20 million in parallel, with which salaries of employees will be paid. If Bulgarian Development bank renders loan to the mines, it’s will be the second case of huge funding by a state bank, which is otherwise was set up to lend to small and medium-sized private companies. The state company is the second largest corporate employer in the country with its 7130 employees and the largest in the region of Stara Zagora. Money is needed so that three mines are prepared for the autumn-winter season. The company has signed a tripartite agreement with NEC and Brickell, as the settlement between them becomes as follows: NEC settles 90% to Mines Maritsa Iztok and 10% to Brickell.
Source: Capital (18.08.2015)

List of Bulgaria’s CorpBank creditors published A list of creditors of Corporate Commercial Bank (CorpBank) has been published in the Commercial Register. The 173-page list contains the names of individuals and firms with recognised claims. The biggest creditor is the Bulgarian Deposit Insurance Fund (BDIF), which paid BGN 3,647,600,000 to 109,230 depositors from December 4, 2014 to August 17, 2015. The list contains the names of depositors with deposits of BGN 196,000, which is guaranteed by the state. The biggest bank creditors are the Bulgarian Development Bank (over BGN 46 million), Societe Generale, Paris (over BGN 44 million), Commerzbank AG, Frankfurt (almost BGN 12.5 million), the Privatisation and Post-Privatisation Control Agency (PPCA) (BGN 10.7 million), and the National Revenue Agency (NRA) (over BGN 3.2 million). Toplofikatsiya Sofia heating utility is the biggest creditor among companies with over BGN 90 million. It is followed by the Dunarit military plant (over BGN 85 million), the Telish winery, NURTS, and others. Hospitals are also among the CorpBank creditors. The list also contains the names of physical persons but Minister of Culture Vezhdi Rashidov and former prime minister Ivan Kostov are not among them. They had themselves said they had money in the bank. The list contains the name of Ahmet Dogan, honorary chairperson of the Movement for Rights and Freedoms (MRF). He had BGN 694,000 in CorpBank. The list was compiled on June 22 and does not include claims that had been paid because they were covered by the state guarantee. The list can be appealed against in up to 14 days, after which the assignees will have their say on claims in 7 days.
Source: Agency Focus (19.08.2015)

More than four months after signing an undertaking to pay the huge debt of a little under 900 million leva to the two US-owned TPPs in the Maritsa East basin: AES Maritza East 1 and ContourGlobal Maritsa East 3, the Bulgarian Energy Holding will at last seek a nearly 1,000 million leva loan in a procedure that will be announced in the "Official Journal of the European Union" on August 27, said Energy Minister Temenouzhka Petkova. The loan, which will be without a State guarantee, postpones the reduction of payments to the TPPs until November, even though this was initially expected to happen in July.
Source: Monitor (19.08.2015)

More than BGN 2.4 million collected for 5 days in NEC’s rescue fund Funds are already being accumulated in the fund Security of the electricity system and as of 17th of August raised money reach over BGN 2.4 million. This what energy minister said. Just in a few days between 24th and 31sy of July the sum was accumulated from the 5% tax on sold power. By the end of this year, NEC has to pay off its obligations to AES Galabovo Maritsa East 1 and ContourGlobal Maritsa East 3. Meanwhile, the Cabinet decided yesterday over 130 hectares of forest lands for the expansion of coal mining from the mine Troianovo 1-site 2 will go to the state mines. Mines Maritsa Iztok has to pay BGN 1.2 million for the change of land utilization has, while the price for compensatory afforestation is set at BGN 1.3 million
Source: Monitor (20.08.2015)

17 Bulgarian companies fall in among the largest 500 in Central and Eastern Europe 17 Bulgarian companies are shortlisted in the rating of the largest companies in Central and Eastern Europe for 2014. A year earlier their number was 13. The Bulgarian companies’ total turnover reaches EUR 17.99 billion, which is a growth by 4.24%. This is what rating of the International credit insurer Coface - Coface CEE Top 500 shows. It is published for the seventh consecutive year, Companies in the entire region generate total turnover of EUR 572 billion, which exceeds almost half of the total sum of the nominal GDP of these economies. The chart ranks companies, as it takes into account as a key indicator their turnover as well as additional indicators such as number of employees and net profit. Number of Bulgarian companies in the rating is growing, which is definitely a positive sign. As a whole, their turnover also goes up, but at comparatively lower pace, which moves them at lower places in the chart. The leader’s position is occupied by Lukoil Neftochim Burgas again, though the company holds the 23rd place. Aurubis is the industrial company that takes the highest position-52 of all Bulgarian participants. The company registers the most serious growth in profit among Bulgarian enterprises-by nearly 216%. The largest ten local companies in the charts are as follows: Lukoil Neftochim BEH, Aurubis Bulgaria, Lukoil Bulgaria, NEC, Bulgargaz, CEZ Electro Bulgaria, OMV Bulgaria, Kaufland Bulgaria and Saxa
Source: investor.bg (27.08.2015)

US-owned TPP AES Bulgaria Finalizes Agreement with National Power US-owned thermal power plant AES 3C Maritza East I and Bulgaria’s National Electric Company (NEK) have finalized the agreement on amending the long-term contract for purchasing electricity generated by the TPP. The agreement was negotiated in April and it concerns the capacity price of AES 3C Maritza East I, according to a media statement of the US-owned TPP. Once the agreement enters into force, the capacity price will drop by 14%, thereby allowing Bulgaria’s state-owned power utility to save around BGN 50 M a year, or a total of BGN 550 M by 2026, when the contract with the US-owned TPP expires. However, the power purchase agreement (PPA) with AES 3C Maritza East I, as well as the PPA with the other US-owned thermal power plant, TPP "ConturGlobal Maritza - East 3, cannot enter into force before the state pays its debts to the two entities. The state-owned power utility owed nearly BGN 800 M to the two TPPs in April, according to reports of investor.bg. AES 3C Maritza East I informs in a media statement that it will immediately cover its liabilities to the Maritsa East Mines, currently at around BGN 60 M, once it receives full payment of NEK arrears, currently at around BGN 500 M. Bulgaria’s Energy Ministry is still looking into opportunities to take out a loan to pay the two US-owned TPPs.
Source: expert.bg (27.08.2015)

Watchdog OKs Agreement between Bulgaria’s National Power Co, ContourGlobal Maritsa East 3 TPP Bulgaria’s Commission for Energy and Water Regulation (KEVR) has approved the power purchase agreement between US-owned thermal power plant ContourGlobal Maritsa East 3 TPP and the National Electric Company (NEK). KEVR Chair Ivan Ivanov announced Thursday that the agreement signed on August 14 between the two entities on amending the existing PPA had been approved at a closed meeting of the watchdog. Ivanov, as cited by the Focus news agency, said that the move paved the way for the entry into force of the new terms of the contracts with the two US-owned TPPs, ContourGlobal Maritsa East 3 TPP and AES 3C Maritza East I. In order for the two agreements to take effect, Bulgaria’s national power utility needs to pay its debt to the two TPPs first. Ivanov made clear that a tender would be announced via the Official Journal of the European Union for a bank to provide NEK with the resources necessary for the purpose. NEK needs a loan of around BGN 1 B to settle its debts to the two US-owned TPPs.
Source: Capital (28.08.2015)

Bulgarian Energy Holding Looking for EUR 650 M The Bulgarian Energy Holding (BEH) has launched a procedure to pick a lender that would help it pay off part of its debts. BEH, a structure managing state-owned assets in the energy sector, is now committed to make the payments under a deal with the AES and ContourGlobal thermal power plants which was reached in the spring. Earlier estimates suggested the sum amounts to EUR 450 M. The move, if successful, could help the state-owned National Electricity Company (NEK) partly solve its debt crisis which has been posing risks to Bulgaria's energy system. April's deal between the state, AES and ContourGlobal was one of the arguments for the national energy regulator to increase prices for household consumers from August 1. In return, when debts have been settled, fixed prices for electricity generated by the AES Maritza East 1 and ContourGlobal Maritsa East 3 TPPs will go down over the next years, allowing NEK to save some EUR 500 M (BGN 1 B) over ten years. Preferential pricing contracts were signed under the administration of PM Ivan Kostov (1997-2001), and some experts have argued financial imbalances in the energy system should be partly attributed to the contracts.
Source: Dnevnik (07.09.2015)

Companies do not want to pay "political costs" in the price of electricity Business will again protest against the new electricity prices. The protest will be on September 30 in Sofia, if DKEVR does not change its decision on the electricity hike for businesses by 15-20% since the beginning of August. The news was announced yesterday by the nationally represented employers' organizations - BIA, BICA, BCCI and CEIBG. Resentment of the business is due to increase by over 100% in charge 'obligation to society’, which is paid by the companies on the free market. Revenue from it goes to cover the deficit of NEK. Employers set five demands with which to overcome the looming crisis. The first is electricity prices to return to levels prior to August 1, i.e. no increase of the additive 'obligation to society’. Bulgaria also needs a roadmap for reforms in the energy sector. "We demand legislative changes and change of the last amendment to the Law on renewable energy, which again expands the purchase of energy on preferential prices. We demand disclosure of the information on the owners of RESs," Bojidar Danev, Executive Chairman of BIA, said.
Source: Sega (11.09.2015)

Bulgarian gas company asks for price reduction Bulgargaz demands a reduction of the price of natural gas of just over 14 percent in October, announced company CEO Petio Ivanov. A slight decrease may be approved early next year. Bulgargaz reported a decrease of financial losses to 27 million leva and also of the debts of district heating companies, which currently total about 150 million, BNR reported. According to Ivanov lower oil prices and US dollar depreciation could result in cheaper natural gas and have a positive effect on the NEC. Another drop of the price of natural gas should lead to some adjustment in the cost of electric power that the NEC buys from heating companies, i.e. a reduction in the price of natural gas is indirectly helping the NEC. Petio Ivanov said that no problems with the supply of natural gas are expected in the winter. By mid-October Bulgargaz plans to supply the gas storage facility in Chiren with about 300 mcm. The company will do so with its own funds. Bulgaria is not currently producing any gas itself.
Source: Sega (11.09.2015)

Business to address Brussels on the electricity issue Bulgarian business sent a complaint to the European Commission because of the electricity issue. The four employers' organizations – CEIBG, BICA, BIA and BCCI, addressed Brussels on breached Community law on state aid. Namely, purchasing electricity by the National Electricity Company from the two American power plants - AES Galabovo and Contour Global - Maritsa East 3. The state buys electricity at fixed prices that are higher than the market prices because of the contract from 2001. Similar findings have also been established by the Commission for Protection of Competition (CPC) in its judgment of 3 July 2013, and by the State Energy and Water Regulatory Commission (KEVR), which also addressed the European Commission. Employers insist that the Commission establishes the infringement and provides information about the procedure on the same signal by KEVR. This will enable the Bulgarian side to renegotiate conditions on purchase of electricity from the two power plants. The four organizations, which plan a large protest against high electricity prices for business on 30 September in Sofia, want a moratorium on the compulsory purchase of electricity at preferential prices.
Source: Standart (14.09.2015)

Deficit in the National Electricity Company (NEK) amounts at BGN 3.7 billion, as some BGN 2.3 billion is generated from unreturned investment expenses on Belene NPP and Tsankov Kamak HPP,” Bulgarian Minister of Energy Temenuzhka Petkova said during her visit to the district of Burgas. Tariff deficit generated by the national grid operation as a result of the regulatory policy amounted at BGN 1.4 billion. The regulatory policy is based on the normative regulation and under it NEK purchases electricity from the two American power plants, the factory plants, the heating utilities, and the RES operators on higher than the market prices. This is a set deficit in the system, which makes NEK unable to pay to the electricity producers.“Fortunately, we managed to negotiate a cut in the availability price. This is the price we pay when these power plants are not loaded and are not working. As a result of this price cut, by the end of the contracts deadline NEK will save up to BGN 1 billion, or BGN 100 million annually,” Minister Temenuzhka Petkova explained. “Current situation Bulgaria’s National Electricity Company (NEK) finds itself in will be overcome and the accumulation of deficit should stop after the full liberalisation of the energy market,” the Minister said.
Source: mediapool.bg (14.09.2015)

Price of Natural Gas in Bulgaria to Drop by 14.26% as of October Bulgaria’s energy watchdog has proposed a 14.26% reduction in the price of natural gas to a rate of BGN 484.26 per 1000 cubic meters, VAT excluded, excise duty excluded, as of October. The proposal of the working group of the Commission for Energy and Water Regulation (KEVR) in connection with the quarterly change of prices of state-owned gas supplier Bulgargaz was discussed at an open meeting of the energy watchdog on Wednesday. During Wednesday’s meeting, the CEO of Bulgargaz, Pepi Ivanov, as cited by dnevnik.bg, expressed his agreement with the proposed price change. Bulgargaz initially sought a 13.65% decrease. However, the Chair of KEVR, Ivan Ivanov, suggested one month ago that the price drop would exceed 14%. As a result, the total gas price decrease for 2015 will reach 30%, as compared to 4.3% for 2014. The final decision on the price of natural gas as of October is to be adopted by the energy watchdog on September 30. The prices at which Bulgargaz will buy gas from Russia’s Gazprom are 15% lower than the Q3, 2015 rates. As is usual in the winter period, the quantities of gas purchased by Bulgargaz go up by 56% from the amount bought in the period July-September. The price of heating as of October will also drop, with the largest increase of 7.2% to apply to customers of the Sofia heating utility, Toplofikatsiya Sofia. Other towns and cities across Bulgaria will experience a reduction in heating tariffs by 1.5%-4.3%, the only exception being Plovdiv, where heating prices will go up by 0.19%. Asked to comment on the matter, KEVR Chair Ivan Ivanov was unable to specify the reasons behind the increase.
Source: Sega (24.09.2015)

Term for seeking of loan for NEC extended Bulgarian energy holding extended the term in which banks that want to lend the state company a loan of EUR 650 million may hand out their offers. The new deadline expires on Tuesday. The energy holding announced the procedure for a new loan on the 17th of September. With the sought EUR 650 million debts of National electricity company (NEC) to the two American thermal power plants – AES Maritsa East ² and ContourGlobal Maritsa East 3 JSC will be covered. They are assessed at BGN 1 billion. That is the requirement if negotiated drop in prices is to enter into force. From them NEC has to save BGN 1 billion in the coming ten years.
Source: Monitor (29.09.2015)

Bulgaria to fully liberalise power market in early 2016 - energy min Bulgaria is scheduled to have a fully operational free power market by the beginning of 2016, the country's energy ministry said on Tuesday. The liberalisation of Bulgaria's power market is a top priority for the government, the energy ministry said in a press release. In the beginning of 2014, the state-owned Bulgarian Energy Holding (BEH) set up the Independent Bulgarian Energy Exchange (IBEX) which holds a licence to operate the electricity exchange in Bulgaria for a period of 10 years. In April, IBEX and power market operator Nord Pool Spot signed a cooperation agreement aimed at setting up a day-ahead power exchange in Bulgaria. In August, the World Bank Group signed a deal with BEH to consult it on the liberalisation of country's energy market.
Source: Capital (30.09.2015)

Prices of Natural Gas, Heating in Bulgaria to Decrease from October 1 At its meeting on Wednesday, the Energy and Water Regulatory Commission (KEVR) adopted the planned decrease of the prices of natural gas and heating from October 1. The price of natural gas will drop by 14.26 % on Thursday, meaning that the total decrease since the beginning of the year will exceed 30 %, private bTV station reports. The prices of heating generated from power plants operating on natural gas will also drop considerably. The calculations of KEVR show that compared to the last heating season, the prices will decrease by 16.4 % in Sofia, 16.8 % in Veliko Tarnovo, 15.3 % in Vratsa, 10 % in Varna, 14.4 % in Burgas, 12.8 % in Pleven and 17.06 % in Razgrad. The lowest drop in the prices of heating on an annual basis will be registered in Plovdiv, where it will amount to 9 %. A reserve of 5 % is left in order to prevent customers from being harmed in case the prices of natural gas increase during the heating season. The chairperson of KEVR, Ivan Ivanov, said that there is a seasonal practice for the prices of natural gas to increase in the fourth quarter of the year.
Source: econ.bg (01.10.2015)

NEK deficit is BGN 3.7 billion The deficit of NEK is BGN 3.7 billion, of which BGN 2.3 billion generated by projects devoid of economic logic, said Minister of Energy Violet Petkova. These are investment costs, which currently have not been recovered, she said, pointing to projects NPP Belene and Tsankov Kamak. She said BGN 1.4 billion is the tariff deficit of NEK, which is the result of the regulatory framework in which the system works. The result of NEK being in such state today is definitely bad management over the years, not only of NEK, but of the whole energy system, Petkova said. According to her the way out of this situation is the introduction of market mechanisms in the sector and "stoppage of leaks" in the system. Bulgarian independent energy market will be a very serious step that puts Bulgarian energy sector into a qualitatively new situation - on a market basis, which is very important.
Source: profit.bg (01.10.2015)

2 banks apply to give EUR 650 million loan to BEH Two banks have issued applications in the BEH’s procedure of providing loan payment to the American TPPs. In the other procedure for choice of investment advisor on issuing of bonds applicants are 12. This marks completion of the first stage of the two procedures. Thus the second stage is pending. Participants who will make it to the second round will present bounding offers. After opening and assessment of offers economically most advantageous proposal for funding will be chosen. BEH is looking for a loan of EUR 650 million, as part of it will be used by NEC to pay off with AES Maritsa East ² and ContourGlobal Maritsa East 3. Obligations of the state company go over BGN 900 million. If they are not paid, negotiated agreed discount in the price of electricity will not enter into force. In addition NEC will not be able to save BGN 1 billion. This saving is planned to be realized within in the next ten years.
Source: Monitor (07.10.2015)

Bulgaria's Lukoil Neftochim Remains Third Biggest Company in Southeast Europe Lukoil Neftochim Burgas, the largest crude oil refinery in Southeastern Europe and the largest industrial enterprise in Bulgaria, retained its third position in the latest annual ranking of SeeNews released on Tuesday. The company which specialises in the production of fuel, petrochemicals and polymers retained its ranking from 2013. Its total revenue for 2014 exceeded EUR 3.3 B, the company registering a net loss of more than EUR 272 M. The Top 100 list ranks the 100 biggest companies registered in Albania, Bosnia-Herzegovina, Bulgaria, Macedonia, Moldova, Romania, Slovenia, Serbia, Croatia and Montenegro. Two Romanian companies – Automobile Dacia SA and OMV Petrom SA occupy the first two positions with the car manufacturer having ousted the oil and gas producer from the first place in 2014. The other Bulgarian companies on the list are: Aurubis Bulgaria AD (8), Lukoil Bulgaria EOOD (13), the National Electricity Company (15), Bulgargaz EAD (41), CEZ Elektro Bulgaria AD (47), OMV Bulgaria OOD (49), Kaufland Bulgaria EOOD & Co KD (61), Saksa OOD (82), AETs Kozloduy EAD (92) and the Bulgarian Telecommunications Company AD (95).
Source: Standart (07.10.2015)

China's ICBC Bank Offering Loan to Bulgarian Energy Holding The Industrial and Commercial Bank of China (ICBC) is likely to become the single company to make a binding offer th the Bulgarian Energy Holding (BEH) as the energy structure is looking for a loan of EUR 650 M to pay off debts. Capital Daily reports, citing its own sources, that ICBC, one of the world's biggest lenders, will be the only one admitted into the next stage where it will be able to place an offer, even though there was also a second candidate. BEH, a structure managing state-owned assets in the energy sector, is now committed to make the payments under a deal with the AES and ContourGlobal thermal power plants which was reached in the spring. Out of the five-year, EUR 650 M loan, some EUR 450 M will be earmarked for debts to the two companies. The holding's majority owner is the state, whose share exceeds 50 percent. Separately, BEH has launched a procedure looking for bridge financing in which 11 of the 20 candidates are expected to be shortlisted. It had made similar steps in 2013 to secure EUR 500 M in funding, but the sole bidder, Deutsche Bank, was later disqualified.
Source: 24 chasa (08.10.2015)

Large Investors in Energy Sector Lash Out Against Reform Package Proposed by Four Employers' Organizations Some of the largest companies in the energy sector in Bulgaria lashed out against a package of reforms which four employer organizations unveiled last week, including nationalization of assets in the power industry. "Organizations which claim to represent all business in Bulgaria are taking action which have not been coordinated with the sectoral representatives and which go against the logic of free market and the principle of inviolability of private property," says a declaration sent out to the news media on Monday. The declaration is signed by the Association of Heating Utilities, the Hydroenergy Association, the Bulgarian Wind Energy Association, the Bulgarian Photovoltaic Association, EVN Bulgaria, AES Bulgaria, ContourGlobal Maritsa East 3 and CEZ Bulgaria. It comes a week after the Confederation of Employers and Industrialists in Bulgaria, the Bulgarian Chamber of Commerce and Industry, the Bulgarian Industrial Association and the Association of Industrial Capital in Bulgaria put forward what they called measures for reforms in the energy sector. The said measures include purchase of the bank credits of green energy plants and their subsequent restructuring through the Bulgarian Development Bank to enable subsequent contracting of lower purchase prices for their electricity. The plan also proposes that the State buy out the shares of two US-owned power plants, AES Maritza East 1 and ContourGlobal Maritsa East 3, and then offer them to a different investor. The problem with these two power plants is that the State has long-term agreements for purchase of electricity at preferential prices. The government is now trying to lower these in exchange of paying up all outstanding debts of the National Electricity Company to the two power producers. According to the signatories to the Monday declaration, the proposed measures go against the national and international law and against the ongoing efforts of the government for stabilizing the energy sector. Furthermore, they threaten to undermine Bulgaria's reputation as a country with a stable investment climate, the declaration says. "This is why we vow our support for any policy based on clear principles, European practices, respect for private property, the law and transparency," the signatories say. They call on the government to distance itself from "such uncoordinated actions" and press ahead with the reforms in the sector aimed at energy security, diversification and independence.
Source: Sega (13.10.2015)

Miners want smaller coal mining Podkrepa union demanded that the coal production from open coal mines in the state Mini Maritsa Iztok EAD-Radnevo is sharply reduced. It already warned the Ministry of Energy, NEK and ESO that in the next six months they can count on only 14 million tons for the three thermal power plants in the complex. These amounts will go to maintain no more than 2800 megawatts of power, which will require or emergency import of electricity or power cuts. "We are forced to this step because of the huge amounts of abandoned work areas. The danger of collapsing mines and repetition of the spring of 1987, a year when Bulgaria became a huge 'disco’ is real, said the leader of Podkrepa in the company Gencho Genchev . Delay in the disclosure of the layers is due to the difficult economic situation and suspended payments by TPP AES and TPP Contour Global Maritsa East 3. Miners are due BGN 450 million, reminded Dimitar Manolov, president of Podkrepa. It is clear that the state must find a way to buy the assets of both plants. The same idea was announced by CEIBG.
Source: Monitor (15.10.2015)

Bulgarian power producer Brikel plans to invest 26 mln euro in 2015-2019 Bulgarian power producer Brikel plans to invest nearly BGN 51 million in 2015-2019. Brikel, which holds a license for the production and transmission of electricity, will invest in projects for the rehabilitation and modernization of its core power equipment in a bid to cut greenhouse gas emissions.Òhe company's investment plan put forward for review by Bulgaria's energy and water regulatory commission. Brikel also plans to build a biomass-fired unit in the next four years, which will cost about BGN 4.4 million. The company expects the preferential tariff for the purchase of its electricity output to drop from BGN 143 per MWh for 2015 to BGN 122.06 per MWh in 2019. The decrease would be the result of falling oil and gas prices as well as of the unchanged price of coal, the chairman of the energy and water regulatory commission. The outcome from the review of the company's business plan will be announced after the regulator holds a second meeting behind closed doors on October 27. The company which is owned by the British Bakar Limited has a license for generation and transfer of electric and heat power.
Source: investor.bg (15.10.2015)

We are waiting for approval from Brussels for a price ceiling of US power plants Bulgarian government expects the European Commission to recognize the state aid on long-term contracts for the purchase of electricity from the so-called US TPP AES Galabovo and TPP ContourGlobal Maritsa Iztok 3, as well as with the producers of electricity from renewable energy. Actions will be taken on this basis to change the contracts in order to reduce electricity prices for households and businesses. The energy watchdog expects to get a response by the end of the year of the complaint that contracts with both plants, as well with the producers of electricity from renewable energy, are unlawful state aid submitted last summer at the European Commission. According to representatives of the government, there are indications that the EC decision regarding the US plants will be positive and mostly in the section concerning the rate of return on capital, which was 12-13 percent higher than the 12-13 normal on the market. This, combined with the market for trading electricity launching in early 2016, would allow the government to implement the imported days ago requests from employers' organizations to introduce a ceiling on the price of electricity purchased from AES and ContourGlobal.
Source: Standart (19.10.2015)

NEK sells assets of Chimco - Vratsa for BGN 18.4 million The National Electricity Company (NEK) announced the sale of assets of Chimco - Vratsa. All land, buildings, infrastructure, production facilities, machinery and equipment are available for BGN 18,404,901. The sale will take place on 03.11.2015, at the office of the trustee in bankruptcy of the plant in Sofia. The sale is at the request of the trustee of the plant by a decision of Vratsa Regional Court and is through direct negotiations under Art. 718 of the Commercial Code - by direct negotiations with potential buyers on the basis of submitted written proposals. The fertilizer plant ceased operation in the early years of the century due to accumulated indebtness. Currently, the largest creditors are Bulgargaz and NEK.
Source: 3e-news (20.10.2015)

Bulgaria Regulator Proposes Power Price Cut for Industrial Consumers Bulgaria’s energy regulator has proposed to cut the ‘duty to society’ fee levied on power prices for industrial consumers which was increased in August. The Commission for Energy and Water Regulation, or KEVR, is proposing to cut the fee by BGN 1.07 to BGN 36.83 per megawatthour, VAT excluded, as of November 1, the head of the regulator Ivan Ivanov said. A cut in the fee has become possible due to a 30% drop in the price of natural gas since the beginning of the year, Ivanov explained. Power prices for industrial consumers buying electricity on the regulated market will be lowered by about two percent, Ivanov added. The proposal will be put to public discussion before taking effect. KEVR's decision to increase the "duty to socety" fee for industrial consumers has drawn protests from employers associations.
Source: Standart (23.10.2015)

The loss of the National Electricity Company (NEK) is expected to reach BGN 400 million at the end of the year. In the first nine months the company’s loss was BGN 311 million, said Finance Director of NEK Rumyana Krasteva within the open meeting of the Commission for Energy Regulation (KEVR) to discuss the minimum depreciation of the additive 'obligation to society’ for business from 1 November. According to Krasteva, change of additive 'obligation to society’ will positively affect the state power company. BGN 40.5 million will be saved from the cost of electricity by district heating companies as expectations are for revenues of BGN 35 million for the whole regulatory period. According to Krasteva, however, this will not lead to a lowering of the company's liabilities. NEK’s revenues decreased in August and September as the received revenues are by BGN 10 million less.
Source: investor.bg (27.10.2015)

Banks demand state guarantees for Bulgaria energy loan-sources Plans by Bulgaria's state energy holding company to raise up to 650 million euros ($713 million) in debt have hit a stumbling block after lenders asked for state guarantees, two sources familiar with the situation told Reuters on Thursday. BEH is seeking to raise bridge financing ahead of a bond issue. It has said it has received two binding offers from banks to lead manage the bond issue, without elaborating. The company needs the proceeds urgently to enforce a deal with two U.S. thermal power producers AES and ContourGlobal, under which the two will lower the price at which they sell their output to BEH's unit, public power provider NEK. After 12 banks initially expressed an interest in lending the money and organising the bond, BEH has received two offers. One is from a consortium of Citigroup, HSBC, Unicredit, Societe Generale and ING , while the other is from Banka IMI, the investment arm of Intesa Saopaolo, said the sources, who declined to be identified. The consortium has asked for state guarantees on the 500 million euros it is willing to provide as bridge financing to the bond, which should be issued nine months to a year after a deal is sealed. ADVERTISING Banca IMI has also asked for state guarantees and has offered only 65 million euros without, the sources said. Bulgaria's finance ministry has declined to extend such guarantees before the huge deficits in the energy system are properly addressed. "In this situation, either the finance ministry should agree to provide state guarantees, or BEH should re-launch the process, lifting the threshold of 500 million euros for the bridge financing," the first source said. "If the ministry allows state guarantees, the deal can be signed in a week. If not, all 12 banks, that have expressed (interest as) initial bidders may be invited to file bids again," the second source said. BEH has also sought to arrange a loan with a bank, but has not received any binding offers and has given up on that option. In September, Fitch credit ratings agency downgraded BEH's long term rating to BB- with a negative outlook, predicting weak credit ratios due to a widened tariff deficit at NEK. NEK's total dues have jumped to 3.7 billion levs, leaving a 1.4 billion tariff deficit, Energy Minister Temenuzhka Petkova said last month, pointing out that the deal with AES and ContourGlobal aimed to slash that shortfall.
Source: investor.bg (30.10.2015)

Bulgaria energy watchdog cut electricity price paid by business Bulgaria’s Energy and Water Regulatory Commission (EWRC) officially set the new electricity prices that came into force as of November 1, 2015. The new tariffs were presented at a briefing at commission’s head office on Sunday. The electricity price paid by industrial consumers was decreased a little bit, while the one paid by household consumers remained unchanged. The planned price cut is explained with the lower natural gas price, which is nearly 1/3 cheaper since the start of the year. The “obligation to society” fee paid by the business, on the other hand, which led to the price decrease for the business was cut from BGN 37.90 to BGN 36.83 per MWh. “This is some 2.8% decrease in the price,” Ivan Ivanov, Chairperson of the Energy and Water Regulatory Commission (EWRC), announced. At a closed sitting the commission decided to cut the “obligation to society” fee with BGN 1.07. The price decrease is explained with the lower natural gas price, which got 14.26% cheaper in the last quarter of 2015. “Bulgaria’s Energy and Water Regulatory Commission (EWRC) decided to keep the electricity price paid by household consumers unchanged so as to guarantee that there will not be an increase in case the natural gas price goes more expensive,” Ivan Ivanov said. Mr Ivanov commented further that the average decrease at the regulated market for non-household consumers is 2.5%. In the meantime, a hacker’s blocked the official websites of the Bulgarian Parliament, the State Agency for National Security (SANS), the National Revenue Agency, as well as of the Energy and Water Regulatory Commission (EWRC). The website of the energy watchdog remained inaccessible.
Source: Duma (02.11.2015)

BEH Loan Problems Will Not Affect Electricity Price, Regulator Says Energy and Water Regulatory Commission (EWRC) Chairman Ivan Ivanov said on Wednesday that, for the time being, there is no reason to expect an electricity price hike due to the problems with the future loans to be taken out by the Bulgarian Energy Holding (BEH). Ivanov said the government's refusal to provide a guarantee for the BEH loans should not push up the electricity price for now, "but we will watch the situation." The loans are partly intended to finance a debt settlement between the National Electricity Company (NEK) and the Maritsa East 1 and 3 thermal power plants as a condition for revising the plants' long-term electricity sale agreements with NEK, which will help NEK reduce its financial deficit. In his remarks to journalists after an open EWRC meeting, Ivanov also said the European Commission is still expected to determine whether the two Maritsa East plants have been receiving unlawful state aid. Discussing another question, he said the regulator is considering whether to let the future Bulgarian independent electricity exchange adopt Central European Time for its own purposes. On November 11, EWRC will respond to the proposals made during a public discussion on the electricity exchange. The Bulgarian independent electricity exchange is to go into operation at the beginning of 2016 after a trial period in December 2015. The World Bank is expected in the middle of November to deliver an interim report suggesting the most appropriate model for the functioning of the exchange.
Source: Monitor (05.11.2015)

The first transaction for electricity on the free market, which will go through the new energy market, will take place on December 9. A day earlier premiere of exchange has to take place. All participants will be registered there- producers, traders, consumers. There will be clarity of the prices at which energy is traded at the time. "The introduction on the stock exchange is absolutely necessary. Otherwise, the contraction of the regulated market will lead to a change in the price of electricity," warned the head of the energy regulator Ivan Ivanov.
Source: Sega (06.11.2015)

Insolvent Bulgarian fertiliser plant Chimco up for sale at starting price of EUR 9.4 mln The assets of insolvent Bulgarian fertiliser plant Chimco have been put up for sale again, at a starting price of BGN 18.4 million, a justice ministry notice indicated. Bids for Chimco's assets can be submitted by November 19, a tender notice posted on the justice ministry's website showed. An attempt to sell the plant at a starting price of 22.8 million levs failed earlier this year after no bids were filed. In 2014, the plant was put up for sale for nearly BGN 29 million but again failed to attract any buyers. Chimco, which halted operations in 2003, used to be Bulgaria's biggest area producer with an output capacity of 800,000 tonnes annually, accounting for approximately 3.5% of global production. The plant also produced ammonia, carbon dioxide, argon and various types of catalysts. It was declared bankrupt in 2004. Chimco is located in northwestern Vratsa.
Source: Monitor (12.11.2015)

Bulgarian Energy Holding to seek unsecured syndicated loan of at least 500 mln euro State-owned Bulgarian Energy Holding will seek a syndicated loan of at least EUR 500 million, to be followed by a bond issue of the same size as the loan. The decision comes after BEH decided to cancel a procedure seeking a combined EUR 650 million in a bridge loan and a bond issue. Talks with candidates to provide the funding will open immediately and are expected to be completed in two weeks. The proceeds of the loan or the bond would go to cover debt accumulated by one of BEH's units to two U.S.-owned thermal power plants. In September BEH said it is inviting preliminary bids for an investment consultant on a 650 million euro bond issue, or for a bank to provide it with a loan of the same amount. In August, U.S. companies AES and ContourGlobal signed agreements with the National Electricity Company. BEH's subsidiary, on a decrease in the prices at which it buys electricity produced by the two companies' thermal power plants. For its part, NEK pledged to pay back its overdue liabilities to the two plants. NEK owes the two plants around BGN 900 million in total.
Source: 24 chasa (13.11.2015)

The free market of electricity faces further delay The free market of electricity for citizens faces further delay and could be introduced, possibly until 1 May. According to the Energy Ministry, the reason is that the process takes time, and the World Bank recommends a smooth reform to Bulgaria. According to previous plans, delayed for about eight years, household subscribers should have been able to choose their supplier of electricity from 1 January. Subsequently, the deadline was pushed back to early March, then –to April 1. Now it seems there will be a new delay. "Whether it's April 1 or May 1, there will be an interim period to allow adaptation to the household consumers. I believe this is a reasonable decision on the full liberalization", said energy minister Temenuzhka Petkova. She participated in the joint meeting of the Energy Committee and the watchdog KEVR, which adopted the budget for 2016. Petkova noted that it will take time to adapt because "we do not need turmoil in the sector."
Source: Sega (13.11.2015)

BEH Terminates Open Tenders for Selection of Investment Consultant, Financing Institution The Bulgarian Energy Holding (BEH) announced on its website on Wednesday that it terminated procedures launched on September 3 for an investment consultant and a financing institution. BEH said it "terminated an open tender with pre-selection for the selection of an investment consultant for the issuance of corporate bonds, and an open tender with pre-selection for the selection of a financing institution(s) for raising a loan/syndicated loan." On November 12, Energy Minister Temenouzhka Petkova told Parliament's Energy Committee and Committee on supervision of the energy and water regulator that BEH would decide on that day to terminate the procedure for selection of bank institutions which can provide a loan for dealing with intercompany obligations in the energy sector. Instead, direct negotiations would be held in the next two or three weeks with the banks which showed an interest in the procedure. The National Electricity Company (NEK) needs the loan to pay off its debt of nearly 900 million leva to US-owned AES Maritza East 1 TPP and ContourGlobal Maritsa East 3 TPP, which themselves owe close to 350 million leva to the Maritza East Mines. This will make possible the entry into effect of an agreement on a 100 million leva annual reduction of the price that NEK pays the US-owned TPPs for availability. Twelve of the world's largest banks have shown interest on condition the loan is government-guaranteed. BEH and the Energy Ministry will negotiate with them to provide the required financial resources of 650 million euro.
Source: Monitor (19.11.2015)

Bulgaria Expects Offers for EUR 650 M Loan to Energy Holding Co. in 2-3 Weeks The Bulgarian Energy Holding company has invited potential lenders to extend a loan of up to EUR 650 M, BNR radio broadcaster reported on Monday. Deputy Energy Minster Zhecho Stankov told reporters on the sidelines of a gas conference in Sofia that invitations had been sent to 25 international financial institutions and loan offers were expected to be submitted within two or three weeks, according to BNR. Stankov, who is also BEH board member, said he hoped that the state-owned company will be able to secure the loan financing by the end of the year. BEH needs the money to enable its heavily indebted subsidiary National Electricity Company (NEK) to repay debt owed to the Bulgarian units of U.S.-based AES Corp. and ContourGlobal. Deputy Energy Minister Nikolai Nikolov told an energy forum in Sofia last week that BEH had decided to launch direct talks with banks over borrowing EUR 650 M after a tender to raise the funds collapsed. Bulgaria cancelled the tender procedure because both candidates, who submitted binding bids to arrange a bond issue and provide bridge financing ahead of it, had asked the government to extend state guarantees on the debt – a request denied by Finance Minister Vladislav Goranov in view of NEK's financial deficits.
Source: Monitor (24.11.2015)

Bulgaria Develops Its Natural Gas Market While Bulgaria is preparing to liberalize its electricity market completely, it is also beginning to develop a natural gas trading segment, Deputy Energy Minister Zhecho Stankov told a discussion on Monday. Stankov said this will allow the local market to improve and become integrated into those of neighbouring countries. With the construction of a natural gas distribution hub in Bulgaria, the country will acquire a functioning gas market, he predicted. The government has proposed a concept for the future gas hub in order to fulfill one of its main goals: the goal of diversifying gas supply sources and routes, he recalled. When the project is carried out, the country will have at least three different sources of gas supply and will thus fulfill one of the most important principles of the European energy market. In addition to importing gas from Russia and via the Southern Gas Corridor, it will also rely on local extraction, the Deputy Energy Minister noted. He pointed out that last week the European Commission included the Bulgarian gas hub concept on a list of projects of shared interest, which means Sofia can expect funding from the EU. Energy and Water Regulatory Commission (EWRC) Chairman Ivan Ivanov said the liberalization of the gas market is of key importance for the whole society.
Source: Dnevnik (24.11.2015)

Nine Banks Show Interest in Lending up to EUR 650 M to Bulgaria’s BEH Nine banks have confirmed interest in lending up to EUR 650 BGN to the state-owned Bulgarian Energy Holding (BEH) company, Energy Minister Temenuzhka Petkova has said. The energy group is seeking the money to enable its indebted subsidiary National Electricity Company (NEK) to repay debt owed to the local units of U.S.-based AES Corp. and ContourGlobal. The two coal-fired power plants, AES Galabovo and ContourGlobal Maritsa East 3, owe BGN 325 M to lignite coal mines in Maritza East basin. The plants’ owners have agreed to cut the price at which they sell their electricity to NEK once they get repaid by the company. The Bulgarian authorities are currently preparing a timetable for negotiations with the interested lenders, Petkova said at an energy conference in Sofia on Monday. Confidentiality agreements have been signed with the nine banks and negotiations with each of them over loan terms are about to begin. The lenders were not expected to seek Bulgarian government guarantees for the debt, Petkova added. Bulgaria decided to launch direct talks with banks over lending to BEH after BEH’s attempt to raise funds for repaying NEK’s debt to the two coal-fired power plants through a bond issue failed last month. Both candidates, who had submitted binding bids in BEH’s tender for arranging a bond issue and extending bridge financing ahead of it, had sought government guarantees for the debt. Finance Minister Vladislav Goranov, however, had rejected the demand in view of NEK’s peristent financial deficits. Petkova said at the start of the energy conference on Monday that NEK has slashed by nearly a third its operating loss for the first nine months of 2015. NEK posted operating loss of BGN 218 M for the January-September period, a decrease compared with BGN 324 M loss a year earlier, said Petkova.
Source: Monitor (08.12.2015)

Sample deals for 1074.5 MWh of electricity in the first day of the stock exchange 1074.5 MWh of electricity were traded in the first session of the energy market, which was held from 12.23 am to 13 am Friday. This is 0.9% of the winter consumption, which is an average of 120,000 MWh per day. The head of the independent Bulgarian Energy Exchange Konstantin Konstantinov said that the relatively good liquidity of the stock market will occur in the trading of 5% of the electricity used in this country. He predicted that this would happen in the first days of live trading in mid-January. The first session was a test. For the first and last time 17 companies announced public offers with prices and quantities for each hour of the day. They ranged from BGN 30 to BGN 83 per MWh. These were not the prices at which they will offer during a real session. Trading volumes were 1133.6 MWh, the only seller was the state-owned Maritsa East 2. The plant reached BGN 74.56 for MWh.
Source: 24 chasa (12.12.2015)

NEK calls for negative balancing energy prices National Electric Company (NEK) asked the energy regulator to allow negative prices of balancing electricity at times of excess production. This happened during a public discussion in the Commission for Energy Regulation (KEVR) dedicated to the marginal prices on the open energy market. A while ago, the energy regulator introduced price caps for balancing, which avoid speculative prices on the open market at times of shortage and negative prices when electricity is in excess. With this decision, the Commission for Energy Regulation set price caps of BGN 202 per megawatt hour at peak consumption and zero cost of excess. According to Ventsislav Markov from NEK, the market is already functioning normally and limits are not needed because the price is determined by the competition.
Source: investor.bg (16.12.2015)