Cause and Effect in European Politics and Law

Cloudy Over the Solar Energy

Ralitsa Kovacheva, April 1, 2012

The Bulgarian energy sector is like a roller coaster: since 2009 onwards we have had a fourth deputy minister of energy, a fourth director of the National Electricity Company, a third director of the Bulgarian Energy Holding. With these words, Nikola Gazdov, president of Bulgarian Photovoltaic Association (BPVA), addressed the participants in the "Solar Balkans 2012" forum in an attempt to explain the complex situation of the renewable energy sector in Bulgaria. In addition, on the opening day of the conference the National Assembly voted on changes to the renewable energy law, adopted only a year ago.

The business and investment conference "Solar Balkans" took place for a second consecutive year in Sofia and euinside was again a media partner of the event. The conference focuses on the development of photovoltaics in the Balkans, while highlighting the leading markets in the region - Bulgaria, Greece, Romania and Turkey. Daniela Schreiber, Director at EuPD Research, Germany, said that the trend at European level was the photovoltaics market to become more sustainable and to develop small capacities for residential needs. The question is no more how to make money from PV but how to save money thanks to PV, Ms Schreiber said.

The sector is no longer a source of quick profit, because feed-in tariffs are being gradually reduced - for example in Germany as early as 2011 PV prices have levelled with the electricity prices for residential purposes. At the same time, the market share for small capacities for domestic consumption is increasing. In line with the general economic trend, Europe is losing its dominant role in the PV market at the expense of Asia, especially in the face of China, Japan and India, Ms Schreiber noted.

1st of July 1 2012 is the D-Day for the Bulgarian renewable energy sector, because then it will become clear if there is free capacity for connecting new facilities to the grid. The aim is not as many investments as possible here and now, but to ensure sustainable development of the sector, Nikola Gazdov said, because "when the market is developing very quickly, it is being stopped, moreover with a handbrake and we do not want this to happen in Bulgaria ". The main problem continues to be the large number of projects the total capacity of which exceeds the capacity of the grid. According to the Committee on Economy and Energy in the Bulgarian parliament, the total capacity of the projects for production of renewable energy amounts to 4700 MW, and the grid capacity is about 2300 MW. According to the Ministry of Economy, about 1000 MW are with official contracts to join the grid, about 3000 MW have preliminary contracts and about 700 MW are operational.

The huge number of signed preliminary contracts led to the amendments in the renewable energy law regarding the terms and conditions for connecting new facilities to the network. The feed-in tariffs for purchasing renewable energy will now be determined at the date of entry into operation of the facility, unlike now - when the construction stage is completed. It is envisaged all new projects to be consistent with the 10-year plans for the network's development, which however have not yet been finalised, BPVA`s Nikola Gazdov noted.

Mr Nikolai Nalbantov with the Ministry of Economy and Energy said at the "Solar Balkans" forum that in 2010 the National Institute of Statistics reported on the use of solar energy for the first time. He explained that the aim was by 2020 the share of PV to reach about 303 MW, as the system can integrate up to 600 MW. At the European level Bulgaria committed by 2020 16% of the total energy consumption to come from renewable sources, as well as 10% of transport consumption.

As the fashion in the photovoltaic sector dictates, however, the Bulgarian parliament passed legislative amendments to simplify the procedures for small capacities. This is one of the commitments enshrined in the strategic framework of the National Programme for development “Bulgaria 2020”. BPVA`s Nikola Gazdov also highlighted the opening of the roof segment as a positive step. This means individuals, as well as small and medium enterprises, to be able to invest in solar rooftops. But the question is these "simplified procedures" to mean really less bureaucracy and less administrative costs, because the investment is not small at all anyway.