site.btaParliament Passes on First Reading Revisions to Energy Act

Sofia, April 4 (BTA) - Parliament on Wednesday adopted on first reading two bills to amend the Energy Act.

A bill tabled by the United Patriots extends the licensing powers of the Energy and Water Regulatory Commission (EWRC). Under the new provisions, the regulator will authorize the sale and acquisition of sizable parts of the assets of companies that operate strategic energy infrastructure. Buyers should be strategic investors which can ensure the sustainable development of the country's energy system. According to the bill sponsors, the amendments will ensure transparency in the sale of energy companies assets. For violations of the new provisions the energy transmission and distribution companies will have their licence withdrawn.

A second bill sponsored by the ruling GERB aims to facilitate the liberalization of the energy market. The amendments are based on a report by the World Bank on the market reform of Bulgaria's energy sector. One of the measures introduces an obligation for transmission and distribution network operators to buy on a market principle electricity necessary for technology costs. Under another measure, electricity producers whose output is purchased at preferential prices will be integrated into the free market through the platforms of the Bulgarian Independent Energy Exchange and will receive a premium from the Energy System Security Fund. The new rule will apply to renewable and cogeneration energy produced by facilities with installed capacity of 4MW and over. The premium will be paid by the fund and will cover the difference between the preferential price and a projected market price. To this end the energy regulator will set a projected market prices for these producers based on the primary energy source by June 30 each year.

The Fund will also be able to claim and collect a public obligation surcharge for green energy.

Delyan Dobrev, chair of the parliamentary energy committee, said that a working group will be set up to discuss the changes between first and second reading.

Energy Minister Temenouzhka Petkova said she supported the amendments and that the Energy Ministry would be participating in the group. Later she told journalists that the energy regulator should be able to authorize transactions with the assets of energy companies. She said that the ministry is drawing up clear rules how the regulator will discharge its new oversight function so that it does not have excessive powers that are foreign. Petkova said that according to the bill sponsor Iskren Vesselinov the sale of CEZ's assets in Bulgaria will fall within the scope of the law. The three electricity distribution companies have opened arbitration cases against Bulgaria.

The opposition Bulgarian Socialist Party said they would abstain during the vote and would submit proposals between first and second reading. The Movement for Rights and Freedoms were against the amendments proposed by the United Patriots.