At its plenary session, the Economic and Social Council adopted a resolution calling for a balanced approach to the implementation of the European Union Emissions Trading System (EU ETS) and the Carbon Border Adjustment Mechanism (CBAM). In it, the consultative body representing employers, labor unions, and civil society organizations calls for a review of carbon policies and measures to address high electricity prices. The document states that it is necessary to strengthen protections for both industry and vulnerable households.
Bulgaria’s national positions before the EU Environment Council and the Energy Council must be reviewed in light of high electricity prices and the threat of a prolonged natural gas shortage. The ESC supports the positions expressed at the government level through a letter signed by ten countries and addressed to the President of the European Commission, requesting a revision of the ECT.
Efforts to adapt to the industry’s new operating conditions and the growing price pressure on the population should be reflected in a detailed sectoral impact analysis that takes into account the differences between export-oriented industries and those with adomestic market within the EU. The Council emphasizes that the specific nature of the regional energy system (more than a 30% share of electricity from fossil fuel power plants) means that the price of electricity in Bulgaria is directly dependent on market dynamics regarding greenhouse gas allowances. This puts price pressure on businesses, which bear both direct emissions costs and indirect costs through the price of electricity. The conclusion is unequivocal: electricity price shocks directly affect businesses and their employees and have a significant impact on employment in the country.
Residential consumers in Bulgaria are already paying the price for the regional imbalance; as of January 1, 2025, they will pay 8.44% higher electricity prices to cover the increased delivery costs. In this situation, there is a high risk that the burden of high prices will be passed on to households not only directly through electricity prices, but also indirectly through higher prices for consumer goods. This will further reduce the purchasing power of Bulgarians, which is already lower than the European average. The ESC also warns of a negative impact on workers’ incomes and an increase in the number of households experiencing energy poverty.
The resolution recommends that a permanent mechanism be established to compensate for excessively high prices and that plans to liberalize the residential electricity market be reassessed.
The advisory body emphasizes that achieving climate goals must go hand in hand with maintaining economic competitiveness and social sustainability, without allowing inequalities to deepen or the national economy to weaken.
The rapporteurs for the act are the vice-chairs of the ESC, Maria Mincheva, Plamen Dimitrov, and Bogomil Nikolov.
At its plenary session , the ESC also adopted an Opinion titled “The Shadow Economy in Bulgaria,” in which it notes that in recent years there has been a trend toward a gradual decline in the shadow economy in the country, but its share remains relatively high compared to EU countries. In the document, the Council makes a number of recommendations for more ambitious and adequate measures to significantly curb and prevent the shadow economy.
The rapporteurs for the bill are Milena Angelova from the Employers’ Group and Atanas Katsarchev from the Trade Unions’ Group.
