Night Power Tariffs May Grow By 10% in Bulgaria

Prices of electricity must go up if we want to boost prospects for heating utilities, said Ilia Nikolaev, Chairman of the Association of Heating Utilities in Bulgaria and executive director of Dalkia Varna, drumming up support for a potential price hike proposal by Bulgaria's energy watchdog.

Nikolaev participated in a public discussion of the report of the State Commission for Energy and Water Regulation (DKEVR) on revisions of prices of electricity and heating produced by cogeneration plants for the second year of the regulatory period of the companies in the Thermal Energy sector.

He called for a minimum 10% increase in night electricity rates, recommending a smaller gap of around 10-15% between day and night tariffs.

In Nikolov's opinion, it is not normal for 40% of Bulgarians to use electricity for heating purposes, given that the respective percentage in Western Europe is 10%.

"Priorities are shifting very quickly- there were years when heating energy was much cheaper and people used the services of heating utilities; then heating tariffs started to catch up with electricity tariffs, making people switch to electric heating", the energy expert explained.

"Many countries have a stable long-term policy for heating utilities, which Bulgaria lacks" Nikolaev stressed, urging for an improved quality of heating utilities' services through a streamlined distribution of heating energy.

DKEVR's report, however, has drawn dissenting opinions from a number of heating utilities.

Stoyan Tsvetanov, executive director of heating utility Toplofikatsiya Sofia said that the company would not be able to sell the planned 200 000 MWh of heating energy.

"We have analyzed consumption rates for the past 3-4 years and we believe that we will not be able to sell the projected volumes of energy", Tsvetanov stated.

The company also fears it will fall short of the 930 000 MWh of electricity target.

DKEVR Chairman Angel Semerdzhiev expressed hopes that Sofia's heating utility will increase output and sales of electricity.

Valentin Terziyski, Deputy Chairman of the Association of Heating Utilities in Bulgaria, pointed out that heating utilities lack information about how members of the working group adjust every single parameter in the pricing formula.

He insisted that direct meetings among representatives of DKEVR and companies in the sector be held in connection with the report of the energy watchdog.

In the meantime, Bulgaria's energy regulatory body suggested Tuesday an increase of 0.66-10% for prices of hot water and central heating from July 1.

DKEVR plans to bring up heating rates in Sofa by as little as 0.66% to BGN 89.52/MWh, with the biggest price hike planned for Ruse. The heating utility in the Danubian city is expected to charge BGN 87.17/MWh, instead of the current BGN 79.25/MWh.

According to preliminary forecasts of state-run gas company Bulgargaz, the price of fuel should grow by 7%, but the final stance of the company is to be announced by June 10.

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