site.btaEnergy Regulator Sees No Reasons to Replace Any of Its Members

Energy Regulator Sees No Reasons to Replace Any of Its Members


Sofia, August 28 (BTA) - There are no reasons to replace any
member of the State Energy and Water Regulatory Commission
(SEWRC), given the positive effects of SEWRC's actions, the
regulator said in an official statement on Thursday.

The statement comes a day after Economy and Energy Minister
Vassil Shtonov said that SEWRC Chairman Boyan Boev and two other
 SEWRC members have been asked to resign because the regulator
has failed to discharge its duties. Meanwhile, the government
set up an Energy Board as a permanent advisory body to the
Council of Ministers in the solution of important energy issues.

SEWRC said in its statement that the problems it has encountered
 in the energy sector include overproduction of electricity from
 renewable sources and from plants operating under overpriced
long-term agreements; falling consumption of electricity due to
gradual market liberalization in the sector; and financial
deficits incurred in the past as a result of flawed
methodologies and inaccurate projection of renewable energy
outputs.

Therefore, SEWRC has drawn up a long-term strategy to address
problems in the sector and has begun to implement that strategy,
 the statement said. The positive effect of the steps taken by
the regulator will only be felt over the medium term, no sooner
than five years from now, and Bulgaria will be able to avoid a
drastic rise of electricity prices for both industrial and
household users. SEWRC has made all its decisions amid utmost
transparency and lawfulness, the regulator said.

Among the measures it has taken, SEWRC also listed audits at
electricity distributing companies which have detected many
irregularities; checks of all renewable energy operators
concerning the procedures of their connection to the power grid;
 and checks of all electricity traders. Actions have been taken
to implement EU Regulation No 1227/2011 on wholesale energy
market integrity and transparency and EU Regulation No 543/2013
on submission and publication of data in electricity markets.

SEWRC further recalled that it has sent two complaints to the
European Commission about unlawful state aid provided to power
plants which operate under overpriced long-term agreements and
about excessive state aid provided to renewable energy
operators.

It is beyond SEWRC's powers to deal with more than half of the
three billion leva deficit incurred by the National Electricity
Company (NEK), the statement said. With its pricing decision on
July 1, SEWRC established a mechanism to offset one billion leva
 of that deficit in the next five years. As for the remainder,
an appropriate mechanism will be created upon completion of an
audit at NEK so as to avoid a sharp rise in electricity prices.
Any other expenses of NEK which have no relevance to the work it
 is licensed to perform, such as the building of a nuclear power
 plant at Belene or the Tsankov Kamuk hydroelectric power
project, should not be factored into the end price of
electricity and are beyond SEWRC's competence, the regulator
said. SN/VE

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