Bulgarian Energy Minister Opposes Methane Price Hike
Energy | October 18, 2011, Tuesday // 17:27| viewsBulgaria's Economy and Energy Minister, Traicho Traikov, says the budget gap is filled by economic activity, not by taxation at any price. Photo by BGNES
Introducing an excise duty on methane and natural gas in Bulgaria must be delayed as long as possible, and never be drastic, according to the country's Economy and Energy Minister, Traicho Traikov.
Traikov spoke for the media Tuesday, saying that after all the budget gap is filled by economic activity, not by taxation at any price.
The idea to impose excise on methane was the brainchild of his colleague - Deputy Prime Minister and Finance Minister, Simeon Djankov.
The plans were for the methane price to go up on January 1 over the introduction of the excise duty. The first estimates showed this increase will amount to BGN 0.7 per kilogram, which would lead to the increase of heating prices in the upcoming winter.
The Head of the State Commission for Energy and Water Regulation, DKEVR, Angel Semerdzhiev, also voiced strong opposition to Djankov's idea, saying heating prices would go up instantly after the excise is introduced.
On Monday, Prime Minister, Boyko Borisov, declared that there will be definitely no excise duty on methane in Bulgaria over the fact it would lead to a price hike of many other services which the country cannot afford in times of economic crisis.
Borisov stated that Djankov's excise idea was a good one, but cannot be currently realized over the crisis.
"This is why I have told all my ministers that when they think out loud this leads to horrible political conclusions," the PM said, adding he was ultimately responsible for the rule of the country and taxing everything would lead to a stronger budget, but also to impoverishment of Bulgarians.
Djankov explained earlier Monday, just days before debates on the budget that the decision on methane excise has not been finalized and if "this is not the right moment, the excise could be delayed."
On Tuesday, Semerdzhiev pointed out that if with the latest decision on methane Bulgarians manage to avoid a heating price hike, for sure in July 2012, there will be an increase of electric power prices for households by about 7%. The watchdog will lower green energy prices, but they would not be sufficient to compensate the increase over new eco requirements for the producers of electric power such as the need to pay for quotas which were until now free, according to Semerdzhiev.
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