Country: Bulgaria

Please find below latest updates as regards national policy and legal-administrative changes. For more information on these measures please contact the national association, contact details are available here

July 2013 - Revocation of the Grid access fee

On June 17th 2013 the Supreme Administrative Court (SAC) has revoked, with several decisions on last instance, the grid access fee for the producers of electricity from renewable energy sources. SAC defined the decision of the State Commission on Energy and Water Regulation (SCEWR) for introduction of grid access fee as unlawful, adopted with considerable violations in the administrative procedure rules, contrary to the substantive law and contrary to the purpose of the law. The violation is essential, since it has brought the introduction of temporal price in random, unreasonable and non-transparent way, in violation with the principle of art.31, it.1 from the Energy Act and etc.

Due to administrative specifics, the revocation of the fee is applicable only for several of the categories photovoltaic installations: 

1. Ground-mounted photovoltaic installations with installed capacity up to 30kWp, commissioned in the first half of 2012;

2. Ground-mounted photovoltaic installations with installed capacity above 30 up to 200kWp, commissioned in the first half of 2012;

3. Ground-mounted photovoltaic installations with installed capacity above 5kWp, for which the feed-in tariff was fixed with decision C-18 of the SCEWR on March 31st 2010.

For installations under these categories, the grid operators have ceased to charge the producers with grid access fee. A large part of the producers has initiated a procedure for returning the illegally taken resources in the form of grid access fee for the period from its introduction (September 14th 2012).

The photovoltaic installations under all the other categories continue to pay monthly grid access fee to the grid operators in the amount of up to 39% of their income. New SAC decisions are not expected until the end of September 2013. Until July the initiative is in the SCEWR - with its own administrative act to revoke the grid access fee for all types and categories of RES power plants. In a process of discussion is a new pricing model and new prices in the Electricity sector for the regulatory period 01.08.2013 - 30.06.2014, part of which should be the new grid access fee for the RES producers.

July 2013 - New feed-in tariffs

Since July 1st 2013 new feed–in tariffs for electricity purchase from photovoltaic installations have come into force for the period until June 30th 2014. To a great extend the new prices are consistent with the current prices of modules, investment and other costs, related to construction of PV power plants.

A summary of the feed-in tariffs for purchase of electricity from PV installations is available on the website of the Bulgarian photovoltaic association.

http://www.bpva.org/en/pages/tariffs.html

July 2013 - Electricity trading rules

Since the end of July 2013 new Electricity trading rules (ETR) have come into force. This document introduces a market for the balancing energy. Based on them, the RES producers with installed capacity above 30 kWp are obliged to send daily hourly forecasts for the generation for the next day. In case of unbalance between the forecasts and the actual generation, relevant sanctions will be imposed.

The model has not yet come into full operation, since the prices for balancing energy have to be additionally fixed, as well as the Electricity system operator has to issue instructions for opening of the balancing market.

This is expected to happen in the beginning of September 2013, but the preliminary data indicates that the RES producers will have new significant expenses for unbalancing of the generation. The question about the balancing groups, in which the RES installations will be grouped and within the frameworks of which, a model for compensation of caused deviations between forecasted and real generation from the relevant generation type will be adopted, is still left open.

July 2013 - Maximal available capacity for connection of new RES to the grid = 0.00 kW

For the second consecutive year the State Commission on Energy and Water Regulation (SCEWR) approved a decision for defining the available capacity for connecting new RES to the transmission and distribution grids for the regulatory period starting July 1st 2013 until June 30th 2014. The decision sets a capacity for all regions and grid voltage levels of 0 (zero) kilowatts. Thus, a kind of moratorium on accession of new RES to the grids since May 2011 until now is legally regulated and administratively realized.

Meanwhile, the order of the National Electricity Company (NEC) from July 2012 - that all renewable energy projects with a preliminary accession contract can actually be connected to the grid after 2016, is still in force.

An exception to these restrictions are photovoltaic installations built on rooftops and surrounding areas of residential buildings in urban areas up to 30 kWp, as well as installations on rooftops of warehouses and industrial buildings up to 200kWp. These categories do not depend on the annual capacity, set by the SCEWR or by the order of the NEC.

However, the investors continue to face enormous difficulties in the legalization of projects and plants of these segments. The Electricity Distribution Companies (EDCs) often refuse to connects such plants, stating that the electricity infrastructure in the relevant region has no available capacity or the grid connection procedure has been delayed with months or years due to a decision of the EDCs to coordinate the possibility for connection with NEC – a procedure, which is not needed for such small capacities. There are curious cases of refusing connection to the grid of a rooftop installation with a capacity of 3-4 kWp. Although a deliberate opinion of the SCEWR from February 2013, stating that plants of the two priority categories should be connected without any problems and under a simplified procedure, such investments are difficult to be implemented and such new plants are very few.

The investors also face enormous difficulties due to the cumbersome procedures under the Ordinance for connection to the grid of producers and consumers of electricity (known as Ordinance 6), which has not been updated since 2008.

Although the Energy Act and the Renewable Energy Sources Act have introduced a number of administrative reliefs for plants with small capacity, in many cases, EDCs and the local authorities decide to act in accordance with the above mentioned Ordinance. So, investors are burdened with a number of unnecessary administrative procedures, many of which are even contrary to their mandatory acts.

As of July 2013 a draft update of the Ordinance is in the process of public debate at the State Energy and Water Regulatory Commission.

May 2013 - General conditions for access to the grid

Since the end of May General conditions for access to the transmission and distribution grid, approved by the SCEWR have come into force. The documents have been adopted through an extremely nontransparent procedure in a moment of changes in the board of the Commission. As a result, new contracts for grid access have been sent to the RES producers by the EDCs, based on the controversial general conditions.

In brief, the documents give significantly wide power to the EDCs and give a number of restrictions to the RES producers, incl. possibility of unreasonable suspension of access to the grid, no obligations to pay damages in case of disconnection of the power plants, obligations for supply and installation of unnecessary equipment for remote control and etc.

Although the new board of the SCEWR gives indications that the general conditions are really problematic, until July 2013 the question is left open and in process of an unauthorized discussion. At the same time, the producers are put in the position either to sign the controversial contracts for grid access, or to be disconnected from the grid, until signing.

April 2013 - 40 % limitations of generation (curtailment)

Since the beginning of April 2013 the Electricity System Operator (ESO), the state-owned company, which is responsible for the operation of the electricity system, has undertaken an illegal limitation of the of electricity generation from PV and wind installations. Until June 2013 the company ordered such a limitation for 24 days in total. In all the cases the order is identical – for a limitation of the generation with 40% of the installed capacity for PV and wind installations in the time range 10:00h to 17:00h.

As a result the producers suffered new serious losses. The cumulative losses, including the illegal grid access fee, reached about 70% of the revenue – mostly for PV plants.

The orders for limitations of the generation were backed with an argument for incapability of operating the electricity system. This action of ESO is completely illegal, because the energy legislation provides a priority dispatch for RES plants. In practice, however, most of the conventional generation plants were not limited, as it was ordered for the RES. In addition, the precise reasons of ESO to order limitation remained unclear. In most of the cases identical climatic conditions occur, respectively identical predicted generation from PV and wind plants in several consecutive days, but for one of the days there is a limitation, and for the other day there is no such limitation.

Following an active dialog with the caretaker government and especially caretaker Minister of the Economy, Energy and Tourism, the Bulgarian Photovoltaic Association had partial success to prove the illegality of the actions of ESO. Thus, at the end of May 2013 the Minister ordered there to be no more limitations for PV and wind plants, unless legitimate threats for the operation and balance of the electricity system really exist.

A number of producers have undertaken legal actions against ESO and grid operators for a loss of earned benefits in the days of limitations.

March 2013 - Equipment for remote control and real time data transfer

Since March 2013 one of the electricity distribution companies - EVN, which operates the grid in South Bulgaria, has initiated an opaque procedure for delivery and installation of equipment for remote control and real time data transfer from the RES power plants to the EDC. According to the RES Act, the power plants with installed capacity above 30kWp should be provided with such appliances, but the text is unclear about which of the parties should bear the costs for it – the producer or the EDC.

In addition, EVN has sent notifications to the producers, connected to its grid, that it has adopted unified equipment for data transfer and remote control of the power plants, which however is significantly and unreasonably overpriced, but which according to EVN has to be paid by the producers. According to BPVA calculation, the proposed by EVN price for the approved equipment is equal to the yearly revenue of an installation with installed capacity of 40 kWp, which makes such an expense unbearable for producers with smaller capacity. 

The possibility of delivering the equipment from alternative source is controversial - the technical specification, approved by EVN, can be met only by one company for electricity equipment. Thus, the producers are put in the position either to accept the proposed equipment, or the access of their installations to the grid will be suspended.

Despite the tens of meetings between the concerned in the process parties, a large part of which initiated by the Bulgarian photovoltaic association, the question is still in process of discussion. In partnership with the other associations of RES producers, BPVA has initiated conversations - this obligation to be applicable only for producers with installed capacity above 200 kWp. Meetings with the institutions and the grid operators related to that matter are scheduled in August 2013.

March 2013: Grid retroactive access fee revoked by the Supreme Administrative Court (SAC)

By decision from 13.03.2013 the Supreme administrative court (SAC) revokes “the access fee” to the power grid for RES power plants, introduced by SEWRC by Decision Ц-33/14.09.2012. It is expected that similar decision will be adopted for the rest of the several hundred of legal proceedings, started in SAC by the RES producers.

The Decisions revoke the access fee for the following categories of objects:

1. The access fee for RES to the grid Section III – for PV power plants, whose feed-in tariffs were set by decision № Ц-18/20.06.2011 of SWERC- it.12 for PV power plants with installed capacity over 200 kWp, commissioned during the period 01.01.2012-30.06.2012. – 189,38 BGN/MWh;

2. The access fee for RES to the grid Section III – for PV plants, whose feed-in tariffs were set by decision № Ц-18/20.06.2011 of SWERC- it.10 for PV power plants with installed capacity over 30 kWp to 200 kWp, commissioned during the period01.01.2012-30.06.2012. – 221,29 BGN/MWh;

3. The access fee for RES to the grid Section I – for PV power plants, whose feed-in tariffs were set by decision № Ц-018/31.03.2010, it. 2 for power plants with PV modules over 5 kWp – 145,66 BGN./MWh.

For further information please visit: http://www.bpva.org/en/articles/article2152.html

January 2013 - Reduction of bureaucratic barriers for rooftop systems up to 200 kW

Bulgarian Prime Minister Boyko Borissov is planning to reduce bureaucratic obstacles for the installation of rooftop PV systems up to 200 kW. According to the Bulgarian Photovoltaic Association (BPVA), the Borissov has started talks with representatives of the Bulgarian energy and water authority DKEVR, as well as with renewable energy associations, in order to define new measures aimed to support the development of residential PV in the country. The government aims to simplify the authorization process and to reduce the time for the installation of residential PV systems from 40- 60 weeks to 6-8 weeks. As stated by the president of BPVA Nikola Gazdov to PHOTON, the government could take action »soon« without providing a specific time frame. According to the database providing information on the legal barriers for the development of PV in 16 European countries of the PV Grid consortium, the installation of small-sized roof-top PV systems in Bulgaria is currently »hampered by numerous complicated procedures, which pull back companies from the segment.« The consortium claims that 30-35 weeks is the average time to build a PV installation for this segment and that the administrative procedure could last up to 8-10 weeks from the first application. Sources: Bulgarian Photovoltaic Association (BPVA), PV Grid

September 2012 - Retroactive measure - Grid Access Fee adopted

By Decision C-33/14.09.2012 (Решение Ц-33/14.09.2012) the State Commission on Energy and Water Regulation (SCEWR) implemented grid access payments for all renewable installations, commissioned after 04.2010. The 'grid access payment' (GAP) is structured and functions as an additional fee. The GAP is based on applications from the operators of the Transmission and Distribution grids, who had informed SCEWR about 'increased costs for management and dispatching of the grids due to the large amount of renewable energy electricity generators'. The determined GAP are not based on calculations of the real costs for management of the energy system, but as a share of the price for purchasing the electricity from RES. In addition, the GAP are discriminatory, because:

1) They affect only RES, but no other types of energy sources;

2) They are different for the different types of RES;

3) They are different for installations with the same parameters, simply because they have been commissioned at different moment; for example, two PV installations with the same technical parameters and capacity (30 kWp) shall pay different GAP: 20% of revenue if commissioned by the end of 2011 versus 39% of revenue if commissioned in the first half of 2012.

The GAP for PV are between 1 and 39% of the relevant FiT:

1) PV installations commissioned until the end of 2011 - 20%;

2) PV installations commissioned in H1 of 2012 - 39%;

3) PV installations commissioned until September 1st 2012 - 5%;

4) PV installations commissioned after September 1st 2012 - 1%.

The GAP for Wind generators is 10% of revenue, for Hydro power plants 5%, for Biomass generators 1%. The decision duplicates the GAP, because it is already paid by all consumers of electricity (incl. the consumed electricity by the PV installations).

The decision contains no real data or calculations of the 'increased costs for management of the grids', and for this reason the GAP are determined as temporary and with no expiration date. There is also no deadline for the grid operators to submit the real calculations of the cost. The decision contradicts many national and European provisions. For this reason, the government and MPs from the ruling party submitted on November 27th 2012 a draft amendment to the Energy and Renewable Energy Acts, asking for a right to SCEWR  (State Energy And Water Regulatory Commission) to determine such GAP for RES producers (the request is still under discussion in the National Assembly). The amendment could legalize the cross subsidy between distribution and supply of electricity by providing the right to the distribution operator to transfer money to the end electricity supplier company.

Impact on the Sector: The decision is making it impossible for PV producers to pay their bank loans. Most affected by the GAP are small and medium PV producers with installations commissioned in H1 of 2012, who have to pay 39% of their income and directly face bankruptcy.

Date of adoption: Adopted on September 14th 2012, in force from September 18th 2012 

July 2012: Unplanned support reduction

Description of the measure:  SCEWR is allowed to determine FiTs more than once per year, but based on unclear conditions and without transparent methodology. By an amendment to RESA, adopted on July 17th 2012, SCEWR can determine the price for purchasing electricity from RES more than once per year. The only necesary condition, which enables this right of SCEWR, is more than a 10% decrease in the value of a price-forming element that should be observed since the moment of the last determination of FiTs. According to this provision, SCEWR determined new purchasing prices for RES in the end of July 2012 with a more than 54% cut (annual adaptation) and proposed another change of the prices only for PV - just three weeks after that - on July 21st 2012 (decreasing PV FiTs with other 39%). New FiTs for PV only were determined by SCEWR from September 1st 2012. The SCEWR motivated this second determination of FiTs on a single website of a German installer company with two completed projects, which gives a chart with the evolution of the PV module prices weekly. BPVA analysis of the website shows that there was no statistic proof of a change in the price-forming  components with more than 10%.

Impact on the Sector: No bank would agree to finance PV or RES investment, because with this competence SCEWR can change the FiT unpredictably; there is no minimum period for which a price change could not occur and there is no clear interval for price decrease.

Date of adoption: Amendments to Energy Act and RESA adopted by the National Assembly on 17.07.2012

May 2011 - Moratorium on grid connection procedure for renewable energy sources (RES).

1) The Renewable Energy Act (RESA), adopted on May 3rd 2011, implemented a moratorium on new grid connected RES. RESA provided no procedure for grid connection until July 2012, when SCEWR  determined annual maximum admissible grid capacity for new RES initiatives. By Decision EM-01/29.06.2012 SCEWR determined 0 (zero) MWp capacity for RES for the regulatory period (07.2012-06.2013).

2) By an amendment of the RESA adopted on April 10th 2012, all RES projects on stage of signed preliminary grid connection contracts were postponed by schedules, coordinated by the National Electricity Company (NEC) and the distribution grid operators, according to the 10-year Plan for Development of the Electricity Grids.

By notification of NEC from July 10th 2012 - all RES projects with signed preliminary grid connection contracts were postponed to be interconnected after 2016. According to this notification, such producers had the possibility to confirm the postponement or to deny it and nullify all grid connection documentation for the projects.

Impact on the Sector:   The only RES projects that can be developed are rooftop and façade PV installations on residential (up to 30kWp) and industrial buildings (up to 200kWp). Grid operators wrongly interpret the notification of NEC as relevant to such projects and therefore send letters to the producers with proposal for postponement of the grid connection after 2016. Large investments in PV projects, modules and equipment are stopped or nullified by these provisions.

Date of adoption: RESA adopted by the National Assembly on 03.05.2011 , Decision of SCEWR adopted on 29.06.2012 , Amendments to RESA adopted by the National Assembly on 10.04.2012, Notification of NEC from 10.07.2012

May 2011 - Cancellation of support

Description of the measure:  Ban  on the construction of PV installations on agricultural lands from 1st to 4th category. The ban affects only PV installations, not other RES technology, nor conventional energy generators, buildings, etc. The ban was implemented as amendment to the Act for Protection of Agricultural Lands (APAL).

Impact on the Sector:  Agricultural lands with category 1-4 represent more than 40% of the agricultural lands in Bulgaria. According to calculations of BPVA, not more than 0.5% of the agricultural lands in Bulgaria could be used for building of 1500MWp of PV.

Date of adoption: Amendments to APAL adopted by the National Assembly on 4.05.2011

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