Bulgaria wind body in reform plea

Bulgaria’s wind industry has criticised the country’s government after a row over renewable energy payments left three major power distributors facing the possible loss of their operating licences.

Officials have started procedures to suspend the licenses of CEZ, the biggest Czech utility, Austria's EVN AG (EVN) and Prague-based Energo-Pro, over a dispute between the three and the National Electricity Company (NEK), the state-owned company that controls Bulgaria’s generation and transmission infrastructure.

The dispute relates to 347.6m lev ($247m) that the three are claimed to owe NEK following a series of changes to the process for processing renewable power generation payments. The trio have yet to formally  respond to the move to suspend them.

The Bulgarian Wind Energy Association (BGWEA) criticised the government for its failure to get a grip of the country’s power sector.

“Because the energy system still suffers a financial deficit, (state regulator) SEWRC is most probably applying pressure to the end suppliers through the procedure for revocation of licenses,” says BGWEA representative Bilyana Lozanova.

“Our observation is that instead of facilitating needed reforms in the sector, the state institutions are applying policies that transfer the problems from one participant in the sector to another – from state companies to private investors,” she adds.

“In our opinion, the reforms in the energy sector in Bulgaria should be based on adequate regulatory processes, expert analysis, and dialogue with stakeholders and transparency in decision making. The current processes in the sector show lack of dialogue, lack of transparency, and sham reform measures that only exacerbate the problems rather than solve them.”

Wind accounts for 5% of total generating capacity and there is a mid-term potential for more than 3GW, according to last year’s EWEA Emerging European Wind Power Markets report.

In the past two years however, the legal framework has significantly worsened with retroactive changes to feed-in tariffs and the implementation of a grid-access levy discriminating against wind power producers, adds the report.

Bulgaria has to meet a binding target of 16% renewable energy in gross consumption by 2020 and its National Renewable Energy Action Plan (NREAP) requires 20.6% renewable energy in electricity consumption to meet the target.