site.btaSofia Heating Utility's Debt to Bulgarian Energy Holding, Bulgargaz Exceeds BGN 1.66 Bln as of End-November

The total amount of the debt of the Bulgarian capital's heating utility, Toplofikacia Sofia, to the Bulgarian Energy Holding (BEH) and public natural gas supplier Bulgargaz stands at BGN 1,663,512,239.59 as of end-November, the district heating company's executive director Petar Petrov announced at an extraordinary meeting of the Sofia Municipal Council here on Wednesday. He said that Toplofikacia owes BGN 896 million to Bulgargas and BGN 767 million to BEH.

The agenda of Wednesday's meeting included one item - a request for a hearing of the management of Toplofikacia EAD because of the increased frequency of breakdowns in a number of residential districts during the heating season.

Petar Petrov assured that the heat supply will not stop this year. "There will be steam, there will be heat, regardless of the breakdowns and daily difficulties, the residents of Sofia will not stay cold this Christmas", said Petrov.

Petrov said that for 2023, the company had reported a loss of BGN 88.4 million at the end of the year. We have regulatory unrecognized costs in the amount of BGN 252.4 million, which includes interest to BEH, the commercial discount that the company does not receive as additional income due to the decision of the Sofia Municipal Council, other unrecognized costs from depreciation and repairs, interest to Bulgargaz, the financial effect of unrecognized costs along the network, Petrov noted. He said that interest to Bulgargaz and BEH is accumulating at a breakneck rate per year and stressed that due to the regulatory framework in which it operates, the company has no opportunity to turn a profit.

For this year, BGN 207.3 million of the company's expenses will not be recognised, its executive director said. Of these, BGN 107.2 million are interest to Bulgargaz and BGN 36.8 million interest to BEH. "We are talking about almost BGN 144 million of accumulated interest, which the company has no way to compensate on its own," Petrov said.

In the beginning of October, public gas supplier Bulgargaz EAD distrained one bank account of the Sofia heating utility company without imperiling the municipal central heating service ahead of the start of the heating season. About a week later, Bulgargaz lifted the distraint on the accounts after the two companies concluded an out-of-court settlement and the heating utility made a partial payment of its liabilities in the amount of BGN 10 million.