Bulgaria takes steps to protect small firms from soaring power costs

Bulgaria's energy regulator will amend its regulations to lower the price of electricity for small- and medium-sized firms that buy their power from a supplier of last resort, its chairman Ivan Ivanov said on Wednesday. The European Union country has liberalised its power market for all businesses since July, but over 40% of small companies have yet to choose an electricity provider and are getting their power from a supplier of last resort.

These suppliers charge a steep premium over market electricity prices, which have soared since August in line with global energy prices as demand picks up during the economic recovery from the COVID-19 pandemic. "We are planning to change the methodology under which the suppliers of last resort calculate the electricity price and that will allow a decrease," Ivanov told reporters.

The changes will come into force from November and be effective for three months, during which time small companies will be encouraged to choose a power trader suitable to their needs, he said. The changes will allow for a 15-30 lev ($8.9-$17.7) cut in the price offered by suppliers of last resort, which are usually between 50 to 100 levs above the market price, Ivanov said.

On Wednesday, the average price on the Bulgarian energy bourse's day-ahead platform hit a new record-high of 362 levs per MWh. Bulgaria's interim government also plans financial aid to help businesses cope with rising power prices but the six-month scheme would need the go ahead from parliament, which will be convened after a Nov. 14 general election.

Electricity prices for households in Bulgaria are regulated and not expected to change until the end of the year. However, higher electricity prices and high gas prices mean they are likely to rise next year. ($1 = 1.6939 leva)

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