Bulgaria: Gas market changes
In recent years, Bulgaria has progressed toward liberalizing its natural gas sector and aligning it with EU standards. Key infrastructure projects include interconnectors with Greece, Serbia, and Turkey, alongside expansions of the Chiren storage facility and increased capacity on the Bulgaria-Greece pipeline.
The Bulgarian parliament recently passed significant amendments to the Energy Act establishing a natural gas exchange, scheduled to launch in early 2020.
A Natural Gas Exchange
The new legislation replaces bilateral written agreements with an organized Gas Exchange. Market participants must now execute sale-purchase transactions at “freely negotiated prices.” However, regulated pricing remains for certain licensed end-suppliers and district heating companies serving thermal power generation and transmission. Household consumers will continue purchasing natural gas at regulated rates.
Thoughts
These amendments represent a substantial advancement toward complete market liberalization. A hybrid system combining regulated and market-based pricing is anticipated to persist temporarily. The regulated segment now applies exclusively to end-suppliers, heating utilities, and residential consumers. The liberalized segment encompasses traders, production firms, transmission and storage operators, LNG facilities, and all industrial consumers directly connected to the transmission network.