The advisory body representing employers, labor unions, and civil society organizations issued recommendations in its statement
The ESC emphasizes the need to update national measures to mitigate the impact of high electricity prices and to take into account the interests of consumers in Bulgaria. The Council reaffirms its position regarding the negative impact of the ongoing absence of a National Energy Strategy, which significantly hinders planning not only for energy companies but also for large consumers in Bulgaria. The electricity market is evolving amid intensified industrial competition, geopolitical instability, and recurring crises. Therefore, continuing to follow long-term policies today—which were, however, established in the pre-crisis years—poses significant risks to the national economy and leads to recommendations for a critical analysis and reassessment. The ESC expresses concern over the rapid integration of non-synchronous renewable energy sources and the decommissioning of existing lignite-fired power plants, which is reducing the security of the electricity system.
This is stated by the Economic and Social Council in its opinion on the topic: “Challenges in the Context of a Liberalized Electricity Market in the Republic of Bulgaria,” which was adopted at a plenary session attended by Energy Minister Iva Petrova.
The rapporteurs are Rumyana Georgieva—a member of the ESC from the Employers’ Group—and Plamen Dimitrov—a member of the ESC from the Trade Unions’ Group.
In a number of its analyses and position papers, the advisory body representing employers, labor unions, and civil society organizations discusses the various aspects of how energy prices affect industry and residential consumers.
In this document, the ESC notes that, with the legislative changes to be introduced in 2025, a new electricity pricing model for residential consumers, NEK EAD is no longer a public supplier, and the quota-based production model for the regulated market is abolished. This step established a regulatory framework for the introduction of a transitional mechanism toward a liberalized market and limited government intervention. ESC emphasizes the need for a broad information campaign targeting not only residential consumers but also micro, small, and medium-sized enterprises, which will be increasingly exposed to the risks of a volatile market. The ESC calls for transparency and accountability in the use of funds from the Electricity System Security Fund, given the declining financial resources available to support residential and industrial consumers.
Behind the term “electricity market liberalization” lies a specific European model that differs significantly from the theoretical concept of a free market, the ESC emphasized. Tariff policies play a major role in the electricity market, the role of regulated monopolies is expanding, and measures are being implemented to favor certain producers at the expense of others. In this sense, the existence of support mechanisms for residential and commercial consumers does not contradict the European model but reflects national socioeconomic characteristics aimed at ensuring stability. The ESC concludes that Bulgaria should uphold national measures to protect consumers, as well as to ensure the sustainable development of the electricity sector and guarantee security of supply.
The ESC expresses concern about the high proportion of energy-poor households, as well as the declining competitiveness in a number of industrial sectors. This is due to a series of global crises, but also to the inertia in implementing decarbonization policies that do not align with the dynamics of international relations. The concept of a liberalized electricity market needs to be reassessed, including at the national level.
At this stage, there is no readiness to restrict—let alone eliminate—the role of the last-resort supplier in connection with the supply of electricity to residential end customers. Proceeding with the liberalization of the residential electricity market without a comprehensive information campaign and consumer preparation would likely have a negative effect, rather than achieving the benefits that liberalization is intended to provide. Therefore, the ESC proposes specific steps to raise awareness and prepare for regulatory change within the next pricing period. The ability to choose an electricity supplier should be introduced only when the market is “mature”—fully integrated into the EU—and residential consumers are able to make an informed decision.
The ESC emphasizes that external influences of an administrative and regulatory nature translate into national challenges in ensuring the reliability of supply, industrial competitiveness, and households’ ability to meet rising costs. Among electricity producers, the changed market model primarily affects condensing coal-fired power plants, which have lost access to regulated contracts for regular supply.
The ESC emphasizes that electricity supply in the EU is closely linked to financial mechanisms for the redistribution of revenue from electricity taxation. This enables the implementation of targeted decarbonization policies and the development of corresponding new infrastructure. However, these financial mechanisms subject the EU economy to disproportionately high electricity prices. The Union’s external dependence is increasing—both because of natural gas’s decisive influence on the electricity market and because of its dependence on suppliers of raw materials and technologies.
The Council calls for the development of specific proposals to update the national position in preparation for meetings of the Council of Europe and supports Bulgaria’s position regarding the country’s accession to the joint initiative of member states to review key elementsof the European Emissions Trading Schemes and the Carbon Border Adjustment Mechanism, while emphasizing the need to ensure effective coordination between institutions and industry in developing implementable national solutions. The ESC expresses its support for the implementation of the legislation’s key objectives, which target the steel, cement, aluminum, automotive, and net-zero emission technologies, with potential expansion to other energy-intensive sectors such as the chemical industry.
It is expected that with the introduction of the ESTE II emissions trading scheme, the price impact on households will expand, as costs forCO2 emissions will be added to the fuels used in buildings and road transport. The combined effect of such a price shock is unacceptable, and steps should be taken to prevent it.
Measures are also needed to preserve the integrity of the power transmission system and prevent system failures, damage to power equipment, and disruptions to the power supply to consumers. The Council expresses grave concern over the growing risks to the stability of the power system. The very physical stability of the grid is at risk due to a lack of basic system parameters such as inertia and stability. In this regard, the ESC calls for restraint in the implementation of large-scale renewable energy projects and for efforts to be directed toward the construction of baseload capacity and long-term balancing capacity, such as nuclear power plants and pumped-storage hydroelectric plants. The ESC supports calls for the creation of a mechanism to ensure year-round operation of a minimum number of large synchronous units at coal-fired power plants. The goal is to maintain the system’s inertia, stability, and security around the clock, as the current liberalized market does not distinguish between synchronous and asynchronous generation sources.
Fossil fuels continue to account for the lion’s share of the EU’s energy needs, with oil representing nearly 37% and natural gas about 23% of total energy consumption. Moreover, consumption of these resources has increased compared to 2013, indicating that decarbonization policies have not yet led to a reduction in external dependence. As the conflict in the Middle East intensifies and instability in energy markets grows, the need to rethink energy policy and move beyond the stereotypical “Green Deal” agenda is becoming increasingly clear. “Green Deal.”
The ESC plenary session also adopted the analysis titled “Implementation of the European Digital Identity Portfolio in Bulgaria: Challenges and Opportunities,” presented by Monika Panayotova, an ESC member from the Employers’ Group.
