The Energy and Water Regulatory Commission (EWRC) approved the price from Naturally gas for January. It amounts to BGN 133.41 / MWh. This was announced by the press center of the energy regulator. According to EWRC, increasing Naturally gas The prices urgently require the establishment of a compensation mechanism for the district heating companies so that they can continue their normal operation in the autumn-winter season.
The Regulatory Commission for Energy and Water has issued a decision in connection with the application submitted by Bulgargaz for approval of a price for January 2022, when the public provider will sell Naturally gas to final suppliers and to persons authorized to generate and transfer thermal energy. The decision was made in accordance with the contractual terms between Bulgargaz and Gazprom Export LLC, the contractual terms with the Azerbaijani company and the related agreements.
The Commission’s decision approved the price from Naturally gas proposed by Bulgargaz on 01/01/2022, updated with the European market indices gas Hubs as of December 31, 2021, with the average monthly exchange rate for converting euros to US dollars. The European Central Bank for December 2021 and the average prices of the alternatives too Naturally gas, Fuels: 1% sulfur fuel Oil and 0.1% sulfur gas Oil as of December 31, 2021. The updated price Information from the public provider includes the quantities of Naturally gas B. in the context of the exemption program, the contracts with the licensees as well as with customers at freely negotiated prices are also shown.
After analysis of the current data and documents submitted by Bulgargaz and after calculations according to price Model, with the decision adopted, the EWRC approved the price from Naturally gas from January 1, 2022 in the amount of 133.41 BGN / MWh (excluding prices for access, transmission, consumption taxes and VAT). For the previous month of December the price 102.33 BGN / MWh was approved by the regulatory authority.
The increased price from Naturally gas for January is the result of rising prices on the international gas Markets in the period following the submission of Bulgargaz’s application on December 10, 2021, in which a price of 117.12 BGN / MWh proposed. At the open meeting on December 29, 2021, the company presented data on quotations showing that during that period the prices of Naturally gas on the European gas The markets were very dynamic and reached historical values of 180 euros / MWh on certain days. According to the public provider, despite the increase compared to the price in December that price from Naturally gas for Bulgarian consumers remains 35% lower than the prices of European gas exchanges. This brings the financial benefit for private and commercial consumers to BGN 675 million for the full year 2021.
The approved price from Naturally gas of BGN 133.41 / MWh includes the component price from Naturally gas at the entrance of the gas Transmission networks, the component for the “public supply” activity according to Art. 17, Paragraph 7 of the NRCPG and the expense allowance component according to Art. 11a, Paragraph 2 of the NRCPG, which bears Bulgargaz’s costs for the underground storage of quantities gas Storage of Chiren in compliance with the obligations of the Emergency Action Plan.
The EWRC is empowered to do the price from Naturally gas at the request of the public provider. On the basis of the data and documents submitted with the application and after checking the calculations, the Commission approves the price from Naturally gas for the month from the first day of the month in accordance with Article 30 paragraph 1 point 7 of the Energy Act. When approving the price from Naturally gas, the EWRC takes into account the specified forecast quantities of Naturally gas from imports for the domestic market and from Naturally gas Reserves, the terms of the supply contracts from imports for the domestic market and the average BNB exchange rate of BGN against foreign currency, which is for the Naturally gas imported into the country. The only power of the commission is to determine whether the application of Bulgargaz meets the requirements of Regulation № 2 on the regulation of Naturally gas Prices and supply contracts.
When determining the expected delivery prices in connection with the entry formation price from gas Transmission networks according to Art. 17, Para. 3 of the NRCPG take into account the total amount of Naturally gas planned delivery in January 2022 and the relative proportion of the quantities for the public supply of Naturally gas, that Naturally gas Release program as well as within the framework of bilateral agreements.
At today’s meeting, EWRC Chairman Assoc. Prof. Ivan Ivanov commented on the price Decision that the regulator, despite his will, does not have the leverage to control the rise in price from Naturally Gas. He expressed concern that the continued increase in price from Naturally gaswhich is entirely due to external factors puts district heating companies in an extremely difficult position, the Naturally gas as their primary source of energy, and it should be noted that this is fuel makes up 60-70 percent of the price of the district heating service. Assoc. Prof. Ivanov pointed out that after the National Assembly’s decision on the moratorium on prices for heating, electricity and water supplies, these companies will continue to provide heating services Naturally gas Prices from July 1, 2021, while at the same time the price of blue fuel paid by them has almost tripled so far.
In this situation, according to the energy regulator, there is an urgent need for a compensation mechanism for district heating companies and all other consumers of Naturally gas in the country. This is particularly important for district heating companies as it allows them to continue their normal operations during the autumn-winter season and supply heat to a large number of consumers in Sofia and other major cities. Otherwise, companies may not be able to pay for the with Bulgargaz Naturally gas you buy. This in turn makes it more difficult for the public provider who, according to the delivery contract, is responsible for the quantities of Naturally Gas. As a result, a high level of corporate debt could be achieved, which poses risks for the entire energy system and the economy of the country, said the EWRC chairman.