Amendments to the Energy Act

Amendments to the Energy Act

Amendments to the Energy Act (EA) and the Energy from Renewable Sources Act (ERSA) were promulgated in issue 41 of the State Gazette on 21 May 2019. The most important changes are outlined below.


Revocation of the preferential regime for the producers from high-efficiency combined generation and RS producers with a capacity between 1 MW and 4 MW

The electricity generated by producers from high-efficiency combined electricity and heat generation and producers from renewable sources (“RES producers”) with a capacity between 1 MW and 4 MW will not be purchased at preferential prices by the public provider and the end suppliers:

  • As of 1 July 2019 – for the producers from high-efficiency generation and
  • Not later than 1 October 2019 – for RES producers.

As from the above dates, the producers will sell their electricity at the organized electricity exchange market, either individually or through a coordinator of a balancing group.

The producers from high-efficiency generation need to conclude not later than 30 June 2019 contracts with the Electricity System Security Fund (the “Fund”) for compensation with a premium which will enter into force as of 1 July 2019. The RS producers need to conclude contracts with the Fund for compensation with a premium not later than 31 August 2019. The contracts are to enter into force not later than 1 October 2019.

The premium amount will be defined annually by the Energy and Water Regulatory Commission (EWRC) as a difference between the preferential prices and the forecast market price determined by the EWRC for the respective period. The high-efficiency producers will be compensated up to the quantities specified by a decision of the EWRC, while the RES producers - up to the net specific electricity production on the basis of which the preferential price is determined, until expiry of the term of their offtake contracts.

With the above amendments the compensation mechanism for the small producers with capacity between 1 MW and 4 MW will become identical with the mechanism introduced last year for the large producers with a capacity of 4 MW and above 4 MW.

Reducing the administrative burden for the small RES producers

The small RES producers with an installed capacity of up to 30 kW will not have to declare their revenues and to pay their contributions to the Fund on a monthly basis, but once annually – until 31 March of each calendar year.

The above producers will also provide information on their electricity generation to the Sustainable Energy Development Agency annually – until 31 January of each calendar year.

Revocation of the prices for access and transmission in the case of export of electricity

The persons who will pay for access and/or transmission to/through the respective electricity grid as of 1 July 2019 have been clearly defined. These are the producers of electricity, the operators of the distributions networks for the quantity of electricity needed to cover the technological costs of transmission, and the final customers (except for the sites of the customers supplied through direct electricity grids).

The above provision will guarantee that the prices for access and transmission will not be due by the traders exporting electricity, and thus the exported electricity will be treated equally with the electricity traded on the national market.

We are at your disposal if you need assistance in relation to the new provisions.

© 2024 KPMG Bulgaria OOD, a Bulgarian limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

KPMG International Cooperative (“KPMG International”) is a Swiss entity.  Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm.

Connect with us