The Energy Regulation and Markets Review - Stikeman Elliott

Bulgaria
regulation is that, although its purpose is to protect public interest and promote
economic efficiency, it can also induce distortions of its own that may affect pricing, cost
reductions, investment decisions.
Since the first steps of liberalisation, the government in power has demonstrated
its intention of avoiding a simple transfer of assets from public to private hands without
being able to guarantee competition or at least to adequately protect market participants
– and most of all customers – from market failures. For this reason, the market in
Bulgaria has become increasingly complex and somehow became stranded in the current
transitional state (i.e., in between competition and regulation). Notwithstanding,
the incidence of continuous state ownership and heavy regulation, the free market is
expanding along these lines as trading on the deregulated segment and electricity exports
of electricity are regular.
On the other hand, renewable energy capacity has been continuously growing.
Regardless of the policy change on renewable energy, the utilisation of renewable
potential will not be impeded; it will merely be channelled through the realities of the
market – customers are not able to carry the increasing burden of a rapidly growing
renewable sector. The expansion of renewable energy will be controlled, but certainly not
abandoned, as policymakers realise Bulgaria’s commitments on sustainable development
and the invaluable benefit of security of supply.
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