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Bulgaria's DKEVR Ascribes 2690 Violations to Energy Distributors

Business » ENERGY | May 14, 2014, Wednesday // 14:52

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Bulgaria: Bulgaria's DKEVR Ascribes 2690 Violations to Energy Distributors

DKEVR's head Boyan Boev (R) and watchdog member Elenko Bozhkov (L) said Wednesday serious violations had been committed by the EDCs according to the findings of the independent audit. Photo by BGNES

Power distributors operating in Bulgaria committed 2690 infringements, as the national energy watchdog DKEVR's audit revealed Wednesday.

Czech-based CEZ and Energo-Pro and Austrian-based were also accused by DKEVR of having provided false accounts of their revenues, with the latter being "millions of BGN" more than reported, according to Dariknews.

They could be facing a minimal fine of BGN 50 M, as statements setting out their infringements are to be prepared within two weeks.

Regulator representatives added they would refer the matter to the National Revenue Agency, the Agency for State Financial Integration and, personally, to the Prime Minister.

Boyan Boev, who chairs DKEVR, explained expenses of the electricity distribution companies (EDCs) were BGN 818 M less than declared.

"Technical losses" declared by the EDCs were, on the other hand, lower that estimated.

This "secret" profit was used to increase "administrative expenses", including those for consulting services, commission or managerial services.

Some of the costs declared by grid operators are described as "groundless" in DKEVR's audit.

EVN Bulgaria Electricity Distribution, CEZ Distribution Bulgaria and Energo-Pro Grids reported to have also gone around Bulgarian legislation on public procurement by using sister companies to provide their goods and services, thus draining significant amount of money from Bulgaria, DKEVR's Boev claimed.

"Lack of quality of services" is also among the violations, in Boev's words.

The audit of activities of EVN Bulgaria Electricity Distribution, CEZ Distribution Bulgaria and Energo-Pro Grids since 2008, started in the beginning of 2014, before a dispute between DKEVR and the EDCs over debts to the National Electricity Company (NEK) broke in mid-March.

Energy regulator officials have claimed it is unrelated to the financial dispute.

However, following Wednesday's results DKEVR is still to decide whether to impose fines on the regulators instead of suspending their permits to operate in Bulgaria, as some Bulgarian media suggested.