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From Bulgaria

03.09.2013 14:31

Energy Regulator Could Delay License Revocation Procedure of CEZ in Bulgaria

Local authorities will have to give their input on whether electricity supply disruptions should be expected, if CEZ's electricity distribution license is revoked

AUTHOR: publics.bg

© elbrown@flickr.com

More than 6 months after the State Energy and Water Regulatory Commission (SEWRC) launched a procedure for revoking of CEZ’s operation license for Bulgaria over Energy Act and Public Procurement Act violations, it is yet unclear when a final decision will be pronounced. In a response to Sega Daily’s inquiry on the matter from the energy watchdog responded that there is no legal deadline determined in the Regulation on licensing activities in the energy sector.

The SEWRC is yet to gather all the information needed from municipal authorities and other institutions in Western Bulgaria where CEZ distributes and supplies electricity to end-consumers in order to assess the consequences on the region from a possible withdrawal of CEZ’s license. Local authorities will have to give their input on whether electricity supply disruptions should be expected. The regulator informed that the investigation will be completed once feedback and evidence is gathered.

Even though the investigation is still underway, actions towards stripping off CEZ of its license is very unlikely to be taken, as the company already complied with all the requirements of the regulator. The investigation against CEZ, Energo-Pro and EVN, which manage the electricity distribution and supply on regional principle, was launched on Jan 19 after protests over soaring utility bills swept the country. Then prime-minister Boiko Borisov orderd a crackdown on the offices of the three companies, the most severe discrepancies emerging with CEZ. The company extended the reading and billing period in December 2012 which resulted in considerably higher bills sent to customers. The company is also carrying out a plan for substituting old electric meters, during which it failed to deliver a standard protocol when replacing the old reading appliances, Sega Daily wrote.

The inspections of the Prosecutor-general’s office unveiled evidence of sever breaches of the Public Procurement Act. Financial investigators reported that CEZ contracted services and goods, such as, financial auditing, telecom services and plane tickets, worth BGN 350 million VAT not included (about EUR 150 million), bypassing the obligatory public procurement procedure.