The Minister of Energy is not surprised by the increase in the price of gas, but transferred the responsibility to BEH

Energy / Bulgaria
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Source: press center of the Ministry of Energy

The Minister of Energy Alexander Nikolov said that he was not surprised by the increase in the price of natural gas by 30%, but rather by the fact that the formulas for reducing the increase in the price of household were not used effectively. He did not specify what he meant, focusing only on some existing possibilities. At the same time, he acknowledged that the EWRC complies with all the requirements of the Ordinance on the regulation of the price of natural gas and transferred the responsibility to the Bulgarian Energy Holding (BEH).

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The fact that BEH is under the auspices of the ministry is a separate issue. However, it became clear that at the moment the Ministry of Energy does not have a vision and idea for the management of the sector at this difficult time for the country. So now we will again wait for analyzes and forecasts.

Therefore, it is not surprising that at the moment there will be no change in the direction of assistance to household consumers of natural gas. Thus, they will continue to pay the higher price of natural gas. There will also be no help for the greenhouse business, which relies mainly on natural gas. Minister Nikolov expressed only the expectation that the decline in natural gas prices over the past two weeks and warmer weather will affect price levels in February, in the direction of decline. At the same time, he called "unserious" the assumption expressed today by Bulgargaz, according to which, while maintaining the price on the gas markets of 65 euros per MWh, the company will bet 32% in the estimated price for February this year.

The commitment that eluded Minister Nikolov was only that due to higher prices, the Ministry of Energy and the Ministry of Finance will most likely "optimize" gas prices for final suppliers. As well as the assurance that no one will be left without heating during the winter season.

It was also clear from the minister's words that the business will not be satisfied with its demands for the removal of the ceiling regarding the electricity aid. Shocking price increase for business is not a fact at the moment, given their expected prices of 700 million per MWh, said Minister Nikolov. We remind you that according to the government's decision, the December business aid is calculated as 75% of the difference between the base price of BGN 185.59 / mWh and the real average monthly stock exchange price of the IBEX day-ahead segment for the month, but not more than 30 % of the real stock exchange price for July 2021. The business is categorical - this percentage ceiling should be dropped.

There will be no repetition of the proposal of the caretaker Minister of Energy Andrey Zhivkov to reduce the price of VAT on electricity by 10%. "VAT is a function of the Ministry of Finance," Nikolov said, adding that his department focuses more on managing the energy system. However, he was adamant that reducing the VAT by 10% would not help any more, as the current scheme is three times more. The question of whether it is effective remains to be seen. However, Nikolov commented that the scheme is at the very beginning, and there will be more clarity in the future.

The wording regarding the supply of Azeri gas also remains unclear. The Minister of Energy has practically confirmed that the Bulgarian side can supply the entire amount of Azerbaijani gas via alternative routes. Thus, the question that has not been answered in space for a long time is why Azerbaijan does not agree with this option. "The supply of 1 billion cubic meters from Azerbaijan on alternative routes is not a problem." The consortium operating Shah Deniz is taking the best care of their interests," the minister said diplomatically, adding that everything was being done at a high level to increase gas supplies.

As it became clear, a meeting with the Greek Minister of Energy Skrekas regarding the Bulgarian-Greek gas connection will be awaited.



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