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19.02.2013 11:54
Financial Inspection Linked Belene Project with High Electricity Prices in Bulgaria
Temenouzhka Petkova, head of PFIA, said the agency found out what is perhaps the biggest ever in Bulgaria disrespect of the public procurement legal framework
AUTHOR: Lyudmila Zlateva

  • © Atomstroyexport

The Bulgarian Public Finance Inspection Agency (PFIA) has uncovered a link between the project for building a second nuclear power plant in Belene and the soaring electricity prices, which led to increased social tension and agitated protests in the last days. While the role of state-owned companies in the calculation of electricity prices has somewhat kept a low profile, people aimed their protest against the electricity suppliers – regional monopolies, managed by privately held foreign companies.
Temenouzhka Petkova, head of PFIA, said the agency found out what is perhaps the biggest ever in Bulgaria disrespect of the public procurement legal framework. According to Petkova, the BGN 200 million (EUR 100 m) deal signed between the National Electricity Company (NEK) and Russia’s Atomstroyexport for the construction of Belene NPP was set up without a tender procedure. The project was subsequently shelved in May 2012 in favor of a cheaper new unit at Bulgaria’s only nuclear station Kozloduy.
This public procurement which never took place could be considered an indicator that the actual price of the deal is higher. As the state energy company NEK fell under the scrutiny of the financial inspection, further presumptions surfaced implying that the interests of Bulgaria might have been systematically disregarded .
The PFIA revealed also serious breaches related to the EUR 250 million-credit lent by BNP Paribas to NEK in 2007 for Belene. It was envisioned as bridge financing for the first year of the construction of the planned nuclear station, but instead went for general corporate expenses of NEK. According to Petkova this is most certainly related to the soaring electricity prices which reflect the deteriorating of NEK’s financial situation following such deals.
The head of PFIA stated that the report of the agency regarding the financial data presented by CEZ Bulgaria, electricity supplier to households in northwest Bulgaria, has been submitted to the prosecution. The other two electric utilities in the country, also managed by private foreign companies – Czech Energo-Pro and Austrian EVN, have also been scrutinized and the findings of the PFIA regarding their financial reports is expected to be ready within 20 days.     

TAGS: Bulgaria | electricity prices | Belene | nuclear energy | Atomstroyexport | public procurement | BNP Paribas | loan | financial inspection | utilities | CEZ | EVN | Energo-Pro | corruption 

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