Heating utility Toplofikatsiya Sofia will be transferred back to the municipality along with its debts, exceeding BGN 510 M, the municipality council decided on Thursday following a long debate.

Council members from the centrist NDSV and leftist BSP parties vocally opposed the transfer, saying that the only solution to the utility problems is its privatization.

“The company is technically speaking bankrupt because its short-term takings are smaller than its obligations,” councilor Vladimir Karolev commented.

Sofia mayor Jordanka Fandakova said she is well aware of the poor state of the company, but insisted that its transfer to the municipality is the best option.

“The government has assured me that legislative amendments will be adopted in a bid to improve collectability,” she said.

Deputy Mayor Minko Gerdzhikov pointed out the government knows well that the troubled heating utility is a problem not only for the capital, but for the whole country.

“Should the operations of Toplofikatsiya Sofia be suspended, the electricity grid of the country will be overburdened,” he said.

Toplofikatsiya Sofia, which has been in the news for more than three years after it was found drained to the brink of bankruptcy, provides heating to about 400,000 households in the capital Sofia.

Until 2008 Sofia municipality was a majority owner of the plant, while the economy ministry held a 42% stake.

Toplofikatsiya Sofia returned to the government in 2008 when Bulgaria’s largest municipality transferred a 58.2% stake in a bid to curb debts.

Plans for its sale, considered to be one of the country's last big energy privatisation deals, have all collapsed.

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