site.btaTrade Unions, Employers Discuss Electricity Price Hike with PM Borissov

114 ECONOMY - ENERGY MINISTER - MEETING - PRIME MINISTER

Trade Unions, Employers
Discuss Electricity Price Hike
with PM Borissov


Sofia, April 22 (BTA) - Representatives of the four employer organizations and the two trade union confederations met Monday at their request with Bulgarian Prime Minister Boyko Borissov and Energy Minister Temenouzhka Petkova to discuss the expected rise in energy prices.

Emerging from the meeting, Petkova said the employers were concerned about the early April rise of electricity prices on the free market. She assured the business executives and the tradeunionists that the State is honouring its commitments to the energy exchange.

The companies of the Bulgarian Energy Holding (BEH) Group sell electricity on the free market complying with the Energy Act. Apart from that, State-owned energy companies offer over 680 MWh daily on the Day-Ahead Market at a price of 44.10 leva. "This is a price set by the European Commission, and it is a commitment we strictly adhere to," Petkova noted.

The participants in the meeting also discussed the state of the Maritsa East 2 Thermoelectric Power Plant (TPP) and concurred on the need to seek opportunities to keep the plant in operation. Petkova sees capitalization as one of the ways to save Maritsa East 2 TPP. She recalled that the BEH buys the greenhouse gas emissions for the power plant and, as result, accounts for these expenses as receivables, which prerequisites a decapitalization of the company.

"About 200 million leva keep us away from decapitalization right now," the Energy Minister explained. The European Commission has been approached to allow an increase of the capital of Maritsa East 2 TPP by this amount which would enable the company to function.

According to Petkova, this will allow the power plant to operate under market conditions and to start making a profit.

After the meeting, Bulgarian Industrial Capital Association (BICA) Board Chairman Vassil Velev said that business executives proposed that electricity import fees be abolished together with the export fees as from July 1 because the plants that produce electricity from renewable electricity (between 1 and 4 MW) will enter the energy exchange.

Velev noted that it was proposed at the meeting to add a requirement in the Energy Act for the Energy and Water Regulatory Commission to make public its decisions at least a month in advance. According to him, this will improve the predictability of prices.

The BICA Chairman insisted on a rescission of the contracts with the two US-owned coal-fired power plants in the Maritsa East basin because they, too, distort the market. "For the regulatory period ending on July 1, the US-owned plants have been overpaid 548 million leva for a year compared to the market price," Velev commented, adding that one of these plants has already recouped its investments and that is an unlawful State aid.

Confederation of Independent Trade Unions in Bulgaria (CITUB) President Plamen Dimitrov said that prices on the energy exchange were indeed slightly above the price levels on regional exchanges between April 1 and 10. He attributes this to the end-March expiry and non-renewal of contracts of big industrial users. Dimitrov said that the increased price in early April was not due to short supply because the companies of the BEH Group continue to increase their electricity supply.

In connection with the condition of the Maritsa East 2 TPP, the CITUB think that the company must be capitalized as fast as possible. Dimitrov argued that this would make it possible to retain the stability of the principal electricity producer. In his opinion, the only way to tackle the high prices of greenhouse emissions is to incorporate these prices into the price of electricity. " We realize this cannot happen too fast because it would affect the prices of both industrial and household electricity," the trade union leader added. IG/TH
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