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17.05.2013 17:04

State Energy Companies to Cut Expenses by Some EUR 131 Million

Minister Asen Vasilev said that the rest of the participants in the electricity system, including the National Electricity Company (NEK), are still to determine how to cut their expenses

AUTHOR: Lyudmila Zlateva

Energy Minister Asen Vasilev
© Ministry of economy, energy and tourism

State energy companies could cut their expenses with BGN 229 million (about EUR 131 m), it became clear during today’s public council held at the office of Bulgarian minister of economy, energy and tourism. State thermal station Maritsa East 2 said it could spare some BGN 100 million and the same goes for Maritsa East Mines, which supply lignite coal to the power plant. Kozloduy nuclear station said it will decrease its expenses by BGN 50 million and the Electricity System Operator by BGN 9 million.

Minister Asen Vasilev said that the rest of the participants in the electricity system, including the National Electricity Company (NEK), are still to determine how to cut their expenses.

For NEK, which is obliged to buy electricity from solar and wind parks at preferential prices, as well as energy from long-term contracts with private ContourGlobal Maritsa East 3 and Maritsa East 1 thermal stations, this could come by the planned abolishing of the so-called “green” and “brown” additions in energy prices which are meant to partly cover the preferential prices. The two additions are currently calculated in the households’ bills and make up a portion of the export electricity price, which practically made Bulgarian export electricity uncompetitive compared to energy from neighboring countries.

“Cancelling the green and brown addition in energy prices is a part of a new energy price calculation model that the energy ministry is envisaging. It is aimed at offering fair and understandable prices. I believe that there will be no increase of electricity prices as of July 1”, minister Vasilev said.

Another facet of expense cutting for NEK, the system operator and the energy utilities which are obliged to connect all new renewable capacities to the grid, would become reality, if producers of renewable energy agreed to cover the expenses for grid upgrades related to new capacities. The gaps between new renewables being built and grid capacity became extremely visible when in January-June 2012 there was a boom in new PVs racing to be connected before July 1 in order to benefit from higher preferential prices. Surprisingly to previous statements, a representative of the Bulgarian Photovoltaic Association said that solar producers were ready to cover such expenses.

Preliminary estimates show that grid expenses for connecting renewables so far amount to about BGN 60 m.