Gas, Heating Rates in Bulgaria to Drop in January 2013

Energy | November 13, 2012, Tuesday // 13:33|  views

DKEVR Chair Angel Semerdzhiev has assured that gas and heating rates will drop as of January 1, 2013. Photo by BGNES

Angel Semerdzhiev, head of Bulgaria's State Commission for Energy and Water Regulation (DKEVR), has assured that heating rates will drop from January 2013 by a yet unspecified percentage.

In a Tuesday interview Semerdzhiev explained that the price reduction would depend on the gas supply contract Bulgaria was to sign with Russia.

"There are mechanisms which can prevent a dramatic gas price hike and they can be included in the next contract," Semerdzhiev noted.

The DKEVR Chair assured that gas rates would drop but refused to comment how the step would affect state-owned gas supplier Bulgargaz and the heating utilities.

Semerdzhiev voiced hopes that the price reduction would suffice to compensate for the uncollected revenues of Bulgargaz.

The head of the energy watchdog suggested that the signing of a direct contract between Gazprom and Bulgargaz would contribute to a higher reduction in gas rates.

DKEVR is to determine gas prices in Q1, 2013 on the basis of a proposal by Bulgargaz which is to be filed on December 10.

According to reports of Bulgarian mass-circulation Trud daily, the next gas supply contract with Russian Gazprom will include a discount of at least USD 13 per 1000 cubic meters of gas.

Bulgaria currently buys Russian gas at an average price of USD 478 per 1000 cubic meters of gas after the 11% discount which entered into force on April 1 and will apply by end December 2012.

According to Trud daily, Russia is ready to offer a reduction to USD 465 per 1000 cu m but Bulgaria seeks a further price cut of USD 10 to USD 455.

The publication says that Bulgaria stands some chance of obtaining an extra discount due to the signing of the final investment decision on the South Stream gas pipeline project, but the preferential tariff will only apply for a year and a half.

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Tags: DKEVR, State Commission for Energy and Water Regulation, Angel Semerdzhiev, gas price, heating prices, Gazprom, Bulgargaz


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