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© ICIS HEREN – Bulgaria considering power import fee from 1 August
2015-07-21

The Bulgarian government is considering imposing a 5% fee on imported electricity revenues, according to a bill currently in discussion.
Earlier this month the energy ministry said it was planning to set up a system security fund which would collect 5% of all power producers’ monthly revenue from electricity sales, revenues from sales of emissions allowances as well as revenue from the public obligations fee (see EDEM 6 July 2015).
The fund is one of the measures the government was keen to introduce in order to fight piling system deficits and to prepare the market for full opening from 1 January 2016.
The majority of the money from the fund would go into state-owned utility NEK which as a public provider is obliged to buy electricity from renewable and conventional sources.
The ministry’s proposal has been going through parliamentary debates for the last two weeks. It is expected to be included in the energy law by the end of this week and to take effect from 1 August.
During the debates the members of parliament were considering several options as to who should be paying money into the fund. The latest proposal foresees that among others, electricity traders who import power to be delivered inside Bulgaria will also have to pay 5% of the revenues from the imported electricity, excluding VAT.
Import fee
In essence this would be a 5% electricity import fee, market participants polled by ICIS on Tuesday (21st July) agreed.
It is likely that traders would avoid importing electricity from abroad as a result.
Bulgaria is a net exporter but Romanian and even Turkish power was profitable to import recently, one Bulgarian trader said. With imports facing a fee, traders are expected to buy from the local producers only. However, as local producers would also be obliged to pay 5% of their sales revenue into the fund, they are likely to increase their selling prices, the trader added.
“It will all filter down to the consumers in the end,” the trader said.
“The idea is clear – buy [electricity] from Bulgaria,” a second one added.
Meanwhile, the market is also expecting a decision by the energy regulator EWRC on the new electricity export tariff from 1 August (see EDEM 29 June 2015).

(Source: © ICIS HEREN - THE ICIS HEREN REPORTS - EDEM 19139 / 21 July 2015; www.heren.com)

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