Asen Lichev: EWRC is harmful for Bulgaria, the whole management model of the water supply and sewerage sector is wrong
The Energy and Water Regulatory Commission (EWRC) is harmful for Bulgaria, the whole model of management of the water supply and sewerage sector is wrong, commented at a press conference today the Minister of Environment and Water Asen Lichev. The key lies in the formula for determining the price of water per cubic meter in BGN, which is equal to the company's revenues for the year divided by the difference between the system input and the total losses of the water company, and this stimulates water companies to have higher losses, Lichev added.
To the whole scheme is added another intermediary of the Water and Sewerage Holding, which from the beginning of its work has returned only obligations of Water and Sewerage Shtumen and obligations for water abstraction fees due to the Enterprise for Management of Environmental Protection Activities (EMEPA). Charges for water intake are 2 cents per cubic meter and are added to the price of water service. People pay, not VAT. According to him, VAT of BGN 11 million is charged and stolen from the water supply and sewerage companies from water abstraction fees, which are around BGN 50-56 million per year.
The state policy in the sector is implemented by the trade companies. The absurdity is even greater because the state policy in the field of water is entrusted to the Minister of Regional Development, but the Water and Sewerage Associations do not have a mechanism to influence the quality of the service because there is an independent EWRC or the owner cannot do anything is because there is no legal mechanism in place and it is handcuffed. The proposal to create a law on water supply and sewerage, which provided for the creation of a new water regulator, did not see the light of day because it was very controversial. However, according to Lichev, a comprehensive law on water supply and sewerage is absolutely necessary, water supply and sewerage should be given the opportunity to offer services on a market basis and state subsidies should be compensated in the price of the service, not in its increase.
During the next programming period of the Operational Program "Environment" the funds will be directed mainly to the closure of old landfills, land reclamation and construction of regional systems, but also to projects that are proven to reduce losses in the water sector, he said. The water companies will not receive gratuitous financing, but 30% of the necessary investments. Now ViK Montana wants an increase in the price of water, and the company has so far received BGN 74 million for gratuitous investments in water supply. In your opinion, are there any grounds for raising the price, in my opinion it should be exactly the opposite, said Asen Lichev. But only if you look at how much money only the Enterprise for Management of Environmental Protection Activities (EMEPA) and the Operational Program "Environment" have financed the water companies, all have received approximately such funds for modernization. I hope that with the Minister of Regional Development Mrs. Violeta Komitova and the two Harvard ministers Asen Vassilev and Kiril Petkov we will start some kind of normalcy.