Society has no real idea what is happening in the energy sector

Things are going in the order we have known for 30 years, the editor-in-chief of 3eNews told BNR

Energy / Bulgaria
3E news
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In the last month and especially in the last days in the energy sector, fire after fire has been burning. Against the background of high gas prices, which on European exchanges are over 81.46 euros per MWh, in our country the price of natural gas on the exchange "Gas Hub Balkan" today, Wednesday, is BGN 153.50 per MWh.

At these price levels, businesses are exhausted and households are paying exorbitant bills. But while compensation is provided for household consumers and district heating, the state does not provide support for industry, arguing that in our country the price of gas is lower than on European exchanges and so they remain competitive in foreign markets. True, gas in our country on the free market is cheaper than the average prices on EU stock exchanges, but only about 5 euros per MWh - does this provide a sufficient advantage for Bulgarian producers over their external competitors?

Against this background, in the gas sector in our country, Petkov's cabinet replaced the management of the state public supplier Bulgargaz and the energy regulator EWRC. And all this is accompanied by a series of scandals, and society can only ask questions to which it does not receive answers.

Following reproaches from the new government for selling gas instead of keeping it for the Bulgarian market, last Friday the new management of Bulgargaz sold 37,000 MWh of residual quantities, some of which are from the Chiren gas storage facility, to the Balkan Gas Hub state exchange. , after which the buyer exports the gas to Romania. A piquant detail is that the buyer of a significant part of these quantities is MET ENERGY TRADING BULGARIA EAD, related to the new head of Bulgargaz Lyudmil Yotsov, who was executive director of MET before becoming a member of the Board and Executive Director of the state public gas supplier. Yes, it is probably not illegal, but it is also not moral ... Preliminary agreements are also possible - to agree on specific quantities and prices with certain contractors, and to formalize the deal through the stock exchange. In such cases, three seconds is a lot...

The society has no real idea what is happening in the energy sector, commented on the situation in our country the editor-in-chief of 3eNews Galina Alexandrova, the lack of transparency in the energy sector before the Bulgarian National Radio.

Whether the gas storage in Chiren is being drained, whether the political leadership should intervene in the work of the company, what quantities and when they will be sold on the free market are questions that experts and analysts comment on.

International tensions over Russian gas supplies continue to keep the market under pressure. In general, the market remains strongly influenced by geopolitical news, and as observers note, it is more in support of the upward trend in gas prices. Against this background, European gas storage facilities continue to be emptied, albeit at a slower pace, due to higher temperatures, wind energy production and other factors.

It is very difficult to find out what is happening, especially after the absurd meeting of the parliamentary committee on energy yesterday, Alexandrova said in the program "Before all".

"For unclear reasons, the meeting was closed to journalists. All calls for transparency and clarity about what is happening remain deeply buried. Society does not have real and precise information about what is happening in the energy sector. "

According to Galina Alexandrova, "things are going in the order we have known for 30 years."

There is probably a problem with Bulgargaz's financial liquidity. "As Nikolay Pavlov said, there is money, but it has been spent, given for its intended purpose and at the moment there are almost no funds in the company's coffers with which to operate," she added.

It doesn't matter if the trades are done in seconds or within a day. The problem is different - why there are no tools and opportunities to more precisely plan the quantities that are released for the market, including from the storage in Chiren, so as not to leave such large surpluses, Alexandrova said.

The software product used by the Balkan Gas Hub platform allows this, explained these days the executive director of Bulgartransgaz Vladimir Malinov. "This is a software product for retailers to meet their offers. The potential possibility of traders negotiating off-exchange is not first in our commitments. Secondly, let this be checked by the competent authorities, "he said, adding in response to a question whether information could be leaked that this could not happen if it is visible on the screen of the relevant stock segment," said Malinov.

The sale of the so-called "Surpluses" are explained by the specifics of balancing natural gas in the system. Since 2014, there is an EU regulation that addresses the issue of balancing the system. As this is a dangerous gas, under high pressure, Bulgartransgaz must protect the integrity and security of the system. Therefore, according to the rules, every user who has a transmission contract with Bulgartransgaz, in pursuance of this European regulation, the balancing rules approved by the EWRC and all other documents, is required to maintain its balance sheet portfolio close to zero. So each of the 67 users must keep their portfolio close to zero - no major positive or negative imbalances. Therefore, the mechanism is provided, which is again approved by the regulator - in case someone has a positive imbalance in the system, they can leave larger quantities, but within this margin, which is acceptable. Bulgartransgaz then buys these quantities at a price that is either approved by the regulator - minus 8%, or the weighted average price achieved on the stock exchange - minus 8 percent.

"For me, the most worrying thing at the moment is that the storage in Chiren has technical quantities of gas below 25% - gas that will reach us within 1 week, if, for example, tensions increase around Ukraine and there is a problem with gas supplies . It is not normal for the storage to be less than 25% full in the middle of winter. This is the state's reserve. "

"These are not only Bulgargaz's quantities, as we currently have 9 customers at the gas storage facility," he said. "Indeed, compared to last year, we have 14-15% less quantities," added the executive director of the transmission company. According to the Association of European Gas Operators, as of February 6, European underground gas storage facilities are filled to 35.91% or 400.8131 TWh.

The storage in Chiren is a very good regulator of the price and stock, which can save both the industry and the household gas consumers in case of supply problems, the journalist noted.

Why aren't the quantities that are being released more precisely planned? It is true that surplus sales have been made before, and this was the official reason for the dismissal of the previous executive director Nikolay Pavlov. And it is claimed that in previous periods the surplus was usually 3 to 5 thousand mWh.

A swap could also be realized - to offer the quantities from Chiren to other companies that draw from Chiren and thus return the quantities to the storage

As another problem, Alexandrova outlined the situation with the two gas exchanges.

It was not right to reduce the composition of the EWRC from 9 to 5. Only the change of people will not solve the problems if some of the rules are not changed, said Galina Alexandrova.

"There are gaps in the gas market that could be filled with new rules, with different trading instruments and access for more suppliers to compete with each other, and not everything to be in the hands of one company to choose from gas buyers."



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