Next winter will be expensive
A significant electricity price increase of about 10% for households is expected from January, marking the largest rise in at least a decade if approved by the energy regulator. The proposed hike stems from high market prices and a deficit in the Energy Security Fund, which relies on revenue caps for electricity producers outlined in the 2024 draft budget.
Legally, the Energy and Water Regulatory Commission (EWRC) sets household electricity prices annually but can adjust them more frequently in cases like sharp market price increases. November saw the highest market prices since 2022, averaging 327 BGN/MWh, with December reaching even higher peaks of nearly 640 levs/MWh during some hours. Despite these pressures, a 10% hike may face political resistance, especially with possible early elections ahead.
Electricity pricing has historically been a political tool to appease voters, often resulting in financial burdens on state or private energy companies. These deficits are eventually offset through loans or state subsidies, ultimately impacting taxpayers.
New lead prosecutor, same old problems
Less than two months after pledging to remain apolitical, acting Prosecutor General Borislav Sarafov has taken actions that have deeply entangled him in political controversy. On Monday, he requested the parliamentary immunity of Kiril Petkov, co-leader of We Continue the Change (WCC), over allegations of abuse of power during his tenure as prime minister in ordering the arrest of GERB leader Boyko Borissov and two associates in March 2022.
By Wednesday, WCC reported that the driver and parliamentary aide to Assen Vassilev, the party's other co-leader, had been detained for 24 hours. The arrest was linked to a customs investigation involving testimony from a former director of the Customs Agency. This sequence of actions suggests Vassilev's parliamentary immunity may also be at risk, escalating political tensions further.
New tax is not the answer
The mining industry has called proposed amendments to the Underground Resources Act "unfounded, unlawful, and outright absurd." These changes, aimed at addressing budgetary shortfalls, sparked strong opposition, leading key enterprises to halt operations on Wednesday in solidarity with workers protesting outside the Council of Ministers during a tripartite meeting.
For the sector, the amendments effectively introduce a third tax that could double state payments at the expense of investments in innovation and modernization, potentially delaying projects and deterring investors. After mounting backlash, Finance Minister Lyudmila Petkova announced on Friday that the tax would be replaced with a one-off payment, although no further details were provided.
The initial proposal included taxing the value of extracted underground resources at rates of 15% for ores and 8% for non-metallic minerals and fuels, irrespective of profitability after processing.
Next winter will be expensive
A significant electricity price increase of about 10% for households is expected from January, marking the largest rise in at least a decade if approved by the energy regulator. The proposed hike stems from high market prices and a deficit in the Energy Security Fund, which relies on revenue caps for electricity producers outlined in the 2024 draft budget.
