site.bta"Bulgarian Electricity Market Liberalization Will Place Sector in Fundamentally New Situation" - Energy Minister Petkova

"Bulgarian Electricity Market Liberalization Will Place Sector in Fundamentally New Situation" - Energy Minister Petkova

Sofia, September 29 (BTA) - "The Bulgarian Government sets a key
 priority on the liberalization of the Bulgarian electricity
market, which will place the Bulgarian energy sector in a
fundamentally new situation," Bulgarian Energy Minister
Temenouzhka Petkova said here on Tuesday at a forum on
"Bulgarian Power Exchange: What, How and When?"

In her words, once liberalized, relations in the sector will be
controlled only by the market and the price of electricity will
be the fair price determined by the market. The role of the
Energy and Water Regulatory Commission (EWRC) will change, as it
 will be tasked with setting the price for transmission, the
price for access and the public obligation surcharge, but the
electricity price will depend on market supply and demand,
Petkova explained.

She noted that this country relies on a consultancy services
contract signed with the World Bank to have a very good model,
meeting European requirements, at the beginning of 2016. "The
change of this model requires legislative amendments to change
the status of the National Electric Company (NEK), which should
be a fact until the end of 2015," the Energy Minister pointed
out.

She commented to journalists that, judging from the experience
in other countries, prices have edged up after the market
liberalization, after which they have fallen below the
pre-liberalization levels. Petkova said that the liberalized
market must be a fact as from January 1, 2016, and trial runs
should begin on December 1, 2015. "We are working very hard on
this, we are on the threshold of this much-awaited process," she
 commented.

Replying to a question, Petkova said that the EWRC has proposed
an interim transitional period of two or three months, so as to
introduce full liberalization for household users as well from
March 2016. "These topics are still debatable," she added.

"The most valuable aspect of the liberal market is that it
promotes competition," Deputy Prime Minister Tomislav Donchev
said at the forum. He argued that all market participants, both
producers and customers, should be adequately prepared for the
liberalization so as to be able to exist and operate on the
market.

"We are processing the proposals submitted, and we will soon
hold a public consultation so as to find the best solution for
the electricity trading rules," EWRC Chairman Ivan Ivanov said
at the forum. Later on, he specified to journalists that the
rules should be ready by November. "With the launch of a
functioning power exchange, the EWRC will practically cease to
set the electricity prices," he confirmed.

The world's largest banks have expressed interest in providing
financial resources for payment of the amounts due by NEK to the
 two US-owned TPPs in the Maritsa East Complex, Petkova said
after the forum. Twelve banks are interested in arranging a bond
 issue, and two banks in extending a loan. They have now been
given time to draw up offers and present them. "I hope we get
good offers that will enable us to settle with the two US-owned
power plants, which in turn would settle with the coal mines,"
the Energy Minister said. She recalled that it had been agreed
that the two TPPs will immediately transfer 350 million leva
they owe the mines, which will "unblock the system".

Petkova said that she is due to hold talks with the Greek Energy
 Minister this week to sort out the last remaining details on
the gas interconnector with Greece. "We are on the point of
signing a final investment decision, which will make it possible
 to start the project which is exceedingly important not only
for Bulgaria but for all Southeastern Europe as well," Petkova
also said.