Shocked Investors: New Law Shatters Bulgaria's Renewable Energy Sector

Business » ENERGY | May 4, 2011, Wednesday // 16:50| Views: | Comments: 10
Bulgaria: Shocked Investors: New Law Shatters Bulgaria's Renewable Energy Sector Investors say not a single wind energy project will be realized in Bulgaria under the new RE Act. Photo by bgfermer.bg

Bulgaria's newly adopted Renewable Energy Act contradicts the Constitution and EU law, and will shatter the country's energy future, according to the Bulgarian Wind Energy Association.

The Bulgarian Wind Energy Association issued Wednesday a devastatingly critical statement on the highly controversial law, whose adoption had been anticipated eagerly by hundreds of local and foreign investors only to see their hopes for facilitated investments dampened.

"We are highly disappointed with the new Renewable Energy Act and we believe that it will have severe consequences for the Bulgarian economy. We want to draw attention to its three major flaws: 1) it places Bulgaria at huge financial risk in the event of a failure to reach the EU 2020 renewable energy target; 2) it is in direct violation of the Constitution of the Republic of Bulgaria and EU directives; 3) it will sacrifice the entire renewable energy sector with thousands of jobs, investment and income for underdeveloped regions, and, most importantly, will sacrifice Bulgaria's security and energy independence," the Bulgarian Wind Energy Association stated.

The wind energy investors argue that Bulgaria's meeting of the EU 2020 renewable energy goal must be the cornerstone of the country's sustainable and independent future, and a major factor in EU policies for combating climate change.

"Instead of encouraging the development of renewable energy in Bulgaria the new law is practically creating conditions for the complete freeze of the industry, and will have very severe consequences in the near future," the statement says.

The investors point out that every percent below Bulgaria's EU 2020 target will cost the country BGN 200 M per year, which means BGN 13 more for the annual electricity bill of each Bulgarian household. At the same time, the total cost of wind energy at the moment adds BGN 0.28 to the bill of every household. The Association says that even if all of the planned wind energy projects with a combined capacity of 2 500 MW start working right away, this sum will rise only to BGN 0.92 because of the preferential prices for renewable energy abolished with the new law.

The wind energy investors argue the law violates the Constitution and EU regulations by introducing post-dated measures regarding investment projects under development, which "undermines the trust in Bulgaria as an investment destination."

"What is more, while EU directives stipulate that RE projects must get a priority access to the power grid, the law places RE behind all other kinds of energy. For example, it places limits on renewable energy sources that do not exist for any other conventional energy source," the investors complain.

According to their statement, however, the worst flaw of the Bulgarian Renewable Energy Act is that the investors will be finding out the price at which they will be selling their energy only after the construction of their power generating facilities is completed.

"For each investor this means that they will have to work for years on their project, to create dozens of jobs, and invest big in equipment and construction while in the meantime the state regulator will be able to change the electricity purchasing price without any restrictions and without any predictability for the investor. This lack of clarity is an insane risk that no sane investor, a bank or a serious person, could assume. The result will be that not a single well-founded wind energy project will be realized until this law is changed. The Bulgarian Wind Energy Association will use all of its resources to dispute this law. We will not stand idly by watching how this law destroys investment and jobs, and is ruining the trust in Bulgaria," the declaration concludes.

According to its website, the Bulgarian Wind Energy Association was founded in June 2010, and currently has more than 40 members; the association unites the majority of companies active in the Bulgarian wind energy sector including manufacturers, developers, financial and technical consultants and law firms.

Detailed information about the provisions of Bulgaria's newly adopted Renewable Energy Act READ HERE in the Novinite.com news article.

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Tags: renewable energy, renewable energy sources, Renewable Energy Act, GERB, Environment Ministry, solar power, wind power, wind energy, solar energy, biomass, hydro-power plant, Nona Karadzhova, Environment Minister, Foreign investors, foreign investment, State Commission for Energy and Water Regulation, DKEVR, Bulgarian Wind Energy Association
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» To the forumComments (10)
#10
mattbg - 12 May 2011 // 08:33:17

the big difference is almost nobody wants to live within 20km of a nuclear plant - it doesn't matter how good the new technologies are compared to the 60's and 70's tech that is in some part a cause of the two biggest nuclear disasters, whatever reduction in the chances of a blowout, there is still a chance.
sure it's a lot cheaper than renewable energy at the moment, but there's reasons turkey want to build one on the border with bulgaria nowhere near any big towns, rather than just outside istanbul - these people who are pushing the nuclear cause should happily live 200 metres from the reactor if it's that safe!

just ain't going to happen.

#9
temujin - 11 May 2011 // 22:17:04

http://www.marketwatch.com/story/originoils-french-joint-venture-participates-in-large-scale-algae-projects-2011-05-11?siteid=bigcharts&dist=bigcharts

This is what Bulgaria needs. Cheap, profitable technology that creates blue collar jobs. Not a nuclear plant.

#8
Hairydave - 11 May 2011 // 14:57:13

Even the majority of enthusiasts for renewables accept that they are not suitable for long term base load generation. hence there exists a need for something else to provide that (and that equates to the majority of generation required at any one time) and that leaves us with the options of hydro-carbons or nuclear. Nuclear is a no brainer. It's now old technology and well understood and doesn't have the security of supply problems that will be increasingly prevalent with hydro-carbons.

On top of that - renewables are still heavily subsidised by very generous infeed tariffs which have warped the market for them over a long period.

When you consider that using renewables also requires a substantial investment in plant that will be, due to the vagaries of nature, not in service much of the time and not reliable to ensure frequency stability across the network it just doesn't make time to bother with them. Build nukes, use pumped storage and some other forms of renewables for peak lopping for sure - but nukes are the way forwards.

#7
sarkan - 9 May 2011 // 16:47:20

Nellie,

"If renewable energy stopped being subsidized, no one would bother with it. the only reason people bother with it is to get the government subsidies and tax credits. California is covered with abandoned wind farms."

Those turbines in California are abandoned due to decades-old inefficient technology. The wind turbines now, are far more efficient and do not need government subsidies. After all, even the government subsidizes a renewable project, as far as the environmental results are concerned, the renewable alternative is obviously cheaper.

You may burn your neighbor's house to get warm during a winter night: it is easy, it is cheap. But the next day you are in jail and eventually you feel much much colder in your cell. Not using renewable sources is something like that. lol.

#6
DrFaust - 9 May 2011 // 09:22:58

Dino,

sometimes I really have to laugh when I read your postings. You obviously try to get an award as the most stupid person on this forum.

Example:

"Try not to be an obvious ignoramus:

Renewable energy is energy which comes from natural resources such as sunlight, wind, rain, tides, and geothermal heat, which are renewable (naturally replenished)."

This as a response to my long posting on subsidies for nuclear power.

You seem to think that someone who posts a comment on subsidies for nuclear power must be an ignoramus, i.e. cannot know what 'renewable energy" is.

I wanted to call this first 'twisted logic', but it's in fact no logic at all. It's more like
'Dino's diarrhea'.

LOL

#5
Nellieherself - 7 May 2011 // 02:02:29

Faust

"And guess what, China is already the biggest investor in the field of renewable energies all over the world - and they know very well why they are investing so much in these renewable energies. "

You just validated Dino's point. China subsidizes everything. The whole Chinese economy is managed and controlled byt the Chinese communist party. Renewable energy can only exist in nations that subsidize their energy production. If renewable energy stopped being subsidized, no one would bother with it. the only reason people bother with it is to get the government subsidies and tax credits. California is covered with abandoned wind farms. Been there, done that, got a t-shirt to prove it...

#4
Dino the Athenian - 6 May 2011 // 17:21:39

Fausto:

Try not to be an obvious ignoramus:

Renewable energy is energy which comes from natural resources such as sunlight, wind, rain, tides, and geothermal heat, which are renewable (naturally replenished).

#3
DrFaust - 6 May 2011 // 11:29:01

"The sad truth is that renewables are subsidy driven and we have not yet produced the laboratory breakthrough to make the new technologies economical and efficient."

You have clearly no idea about what you are talking - as usual.

Nuclear power is an extremely high subsidized energy form in all countries in which nuclear reactors exist. A fact that supporters of nuclear energy tend to 'forget'. Profits in nuclear power production are always 'privatized', the social costs that are immense are always 'socialised'. You are obviously too naive to understand that.

In many countries the percentage of renewable energies exceeds already the percentage of nuclear power. The investment costs are decreasing drastically, even in the field of solar energy. And guess what, China is already the biggest investor in the field of renewable energies all over the world - and they know very well why they are investing so much in these renewable energies.

You better stick to to your usual field of expertise: invented facts and figures on Turkey, a country that is in almost every respect so much more successful than your paradise of crooks.

#2
Dino the Athenian - 5 May 2011 // 14:08:03

The sad truth is that renewables are subsidy driven and we have not yet produced the laboratory breakthrough to make the new technologies economical and efficient.

If these guys (see video) have problems then the rest of the world is in the Dark Ages regarding renewables:

http://www.youtube.com/watch?v=NMO07APalZ0

#1
sarkan - 4 May 2011 // 18:25:32

BB does his best to block renewable alternatives to his beloved Lukoil.

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