"Bulgaria could boost its competitiveness and social welfare through the more efficient use of its energy resources," says a World Bank report entitled "Bulgaria: Energy and Environment Review (EER)."

According to the report, over the next decade Bulgaria will invest several billion dollars in the rehabilitation, replacement and expansion of its energy infrastructure to meet energy demand in an efficient manner and to comply with the environmental and nuclear safety requirements of the European Union.

The report recommends building a low-pressure distribution system for natural gas to allow consumers to avail themselves of an efficient and clean alternative energy source, and reducing the subsidy in household electricity and district heating prices. This is the only way in which Bulgaria can be an important energy supplier in the region, minimize its dependence on imported fuels, and meet its international commitments in environmental protection, the EER notes.

According to the report, Bulgaria stands out with its excessively high amount of electricity used by households. This fact will likely pose a serious public policy challenge as electricity prices are adjusted to their full cost recovery level. Well-targeted social protection programs are needed to cushion the impact of inevitable tariff adjustments on vulnerable low-income consumers.

As the World Bank report suggests, crafting a long-term cost-effective energy supply strategy, which provides adequate energy security, complements environmental objectives, and reinforces the national goals of economic growth and poverty alleviation, will be a challenge for the government.

The EER report was undertaken at the request of Bulgaria’s former State Agency for Energy and Energy Resources (SAEER), which has now been transformed into a Ministry of Energy and Energy Resources.

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