Bulgarian Energy Distribution Companies Accused of Illegal Price Boosting Practices

Business | March 19, 2015, Thursday // 12:30|  views

Photo: BGNES

The Bulgarian Commission for Protection of Competition issued official statement Thursday that the three electricity distribution companies in Bulgaria CEZ, EVN and Energo Pro have committed a violation to articles 21 of the Law on Competition Protection.

The law violation concerns the unreasonably high prices determined for access to the poles with low voltage grid. Thus, they are effectively restricting and even preventing the competition and subsequently negatively affecting the best interest of consumers.

The proceedings are largely related to the conditions under which the three companies have been providing rights for construction of cable electronic communication networks on low voltage pillars across the country.

According to the market analysis there are no other economically feasible ways for electricity distribution than the currently existing network that is being administered by the three companies. The alternative of building a brand new electricity distribution network has also been deemed unprofitable.

The Commission for Protection of Competition has established that the price at which the network is being lend has been appointed without a clear analysis of the factors that affect it. As seen by the price determination documents provided by the distribution companies, the same expense is being quoted in the licensing portion and in the added value component. The licensing expense seems unreasonably high thus increasing the final price to consumers artifically.

The conclusion has been made that the three companies are thus expolitating the local market.

In May 2014 similar accusations have been made with regards to the three companies' policies, but further data and analyses had been requested on their behalf so that the proceedings can become effective.

All parties invloved have the right to object to the accusations in 30 days, starting from the date of receipt of the claim.

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Tags: Commission for Protection of Competition, Bulgaria, Law, energy distribution companies, CEZ, EVN, Energo PRO, violation, price boosting, prices, access, network, claim


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