Balkan Industrial Park, located on the site of the former automotive plant in the city of Lovech, in north-central Bulgaria, has been licensed by the Energy and Water Regulatory Commission (EWRC) as an operator of a closed electricity distribution grid. That will exclude it from the scope of Electrodistribution Grid West (formerly CEZ Distribution Bulgaria), making it the first such case in Bulgaria after the option was provided for in the Industrial Park Act in 2021.
The industrial park plans to generate electricity at a huge newly-built solar park on its territory, which has also been recently approved by the EWRC. More than 102 million levs (52.1 million euro) has been invested in two adjacent photovoltaic plants with a total capacity of 106.2 megawatts. The panels occupy nearly 72 ha, which is more than half of the total area of the industrial park of 131.5 ha.
The owners of the industrial park are the Domuschiev brothers, Kiril and Georgi, who acquired the former automotive plant during the mass privatization process in the 1990s. Investor in the solar park is Bul Invest Group 2009, a company connected with them. The funding is provided through a loan agreement with the Domuschievs' investment holding company Advance Properties and amounts to 168 million levs. The money has been injected as capital in Photovoltaic Plant Lovech, a newly established company for the construction and management of the solar park.
According to the agreement, the loan will be repaid with dividends from the park by the end of July 2025. Given the current prices of electricity, however, that is not very likely.
A park without plants
The photovoltaic plants are envisaged to initially provide electricity to Balkan itself and to Photovoltaic Plant Lovech, and then to potential investors, including the future e-vehicle plant of Germany's Next.e.Go. However, there are almost no manufacturing facilities on the site at present. Balkan turns some 2 to 3 million levs a year from the production of forklift assemblies and bicycles. The big jump in its revenue to 17.6 million levs last year was the result of the sale of land: 17.4 ha to Next.e.Go and 71.6 ha to Bul Invest Group 2009.
The German company had to invest 140 million euro in a new plant in Lovech and registered a local entity, Next.e.Go Bulgaria, in which Advance Properties is a partner with a stake of touch below 50%. However, the project seems to have been shelved, after last year Next.e.Go announced a decision to invest in North Macedonia.
The EWRC's decision to license the Balkan Industrial Park in practice excludes it from the system of Electrodistribution Grid West and turns it into a small closed electricity distribution grid. The company is obliged to consume at least 30% of the electricity distributed into the grid.
Closed grids are intended to ease plants' access to electricity and thus encourage investments in the industrial parks. However, that may also limit companies' choice of supplier.
Balkan has already signed a contract to connect the photovoltaic plants to the closed grid of the park. It has also presented a project for the construction of energy storage systems on the site but no details have been announced.