The protest is for secure energy at an affordable price. For several months now, we have been pushing for a secret solution to predictability and security of supply and price levels that will make us competitive in the European market.
We are exporters. The Bulgarian economy is an open economy. Over 50% of gross domestic product comes from exports, and at the same time we get energy at significantly higher prices than our EU competitors.
This was stated by the Chairman of the Board of the Association of Industrial Capital in Bulgaria Vasil Velev in an exclusive comment to BLIC, talking about the upcoming May 18 protest against the government of Kiril Petkov and in particular his policy in the energy sector.
The price of electricity has quadrupled. After the compensations this increase is 2.5 times. Our competitors are at half the price of electricity at which we are supplied. This additional uncertainty …. For example, for the month of May at this time there is no compensation. There are vague promises.
We have been working for half a month without knowing what the cost of production is. What does this lead to? Either reinsurance and an increase in prices and hence higher inflation than allowed, or, if the market does not accept this increase in prices – a reduction in production and the release of people, he continued.
Precisely because of this uncertainty and these high prices and undercompensation, both in size and timeliness – because we are always late and unpredictable – for these reasons our inflation is significantly higher than the European average, and GDP recovery is significantly lower than the European average. That is why we are protesting, Velev said.
We know that there is an easy solution that can be implemented in the long run. Namely, with part of the over-profits, from the unforeseen, extraordinary, unexpected profits in the energy sector, which are ten times higher than usual, with part of this overpaid by us, from the money made by us, our workers, to compensate all consumers , including in the social sphere, healthcare, education, culture, sports, religion. All free market consumers. They are over 633,000, Velev explained.
Prices in the foreseeable future will be on the market the next day in the range of 400 and over 400 levs. They can be halved precisely by the excess profits of energy companies, both public and private. The EU has recommended and allows the taxation of these over-profits, over-taxation. That is why a law must be passed. There are such laws in a number of European countries adopted in September and October last year, the chairman of BICA was indignant.
That is, in order for our companies to be competitive on the European and world markets, they must receive energy at relatively the same prices as our competitors abroad. And they do not receive energy for 400, but for 100 leva. Under long-term contracts, in another regulated way. We insist on that, he added.
For months, things have been patched up month by month and we do not have security and predictability. I repeat, we are not clear for the month of May in mid-May whether there will be compensation and in what amount. And a sustainable scheme can be achieved, as the EC says and recommends in its RePowerEU communication – as long as necessary. Not month after month, but in the medium term. Without such a decision, we will not return from the square.
If such a decision is not made by this protest, there will be other protests. We demand that these decisions be made now or that the government give way to someone else who can make these decisions. Because, for God’s sake, these decisions are not difficult, they are not complicated. Other European countries have done it, Velev was adamant.
They manipulate people, as you can see, the prices were the same as in other places, and the compensations were the biggest in our country. This is a complete manipulation. In our country it is overblown and seized to a much greater extent than in other countries, because in other countries the enterprises are supplied under long-term contracts at many times lower prices, and in our country everything is a day ahead market and undercompensation of these ultra-high prices .
The other request is for natural gas. We insist that the difference between the price according to the formula, as it would be for May and the one announced by the EWRC – in our opinion the difference is 30% – to be reimbursed to companies, clearly aware that they will actually be taken from us again. Where to get? From the budget, we fill the budget again, but we must not make enterprises uncompetitive.
We believe that the tolls should also be reconsidered, the intentions of the government do not have a convincing analysis to prove the effectiveness of the current activity, and such an analysis should have been made.
These excise taxes on electricity, they are rather PR. They are below 1% of the price. They are not a significant part of the price. This is a kind of crisis PR, not a pro-inflationary solution. Such a decision is the timely sustainable compensation of the extremely high electricity prices, explained the chairman of BICA.
Velev was also quite categorical about what will happen after May 18 if the demands of the business are not heard by the government of Kiril Petkov.
“If we are not heard on May 18, there will be another protest, which will be in Sofia and throughout the country. Roads, border crossings, communication facilities and so on will be blocked, people’s patience is exhausted. We are now stated that the protest is not political, but if the Council of Ministers does not do its job, it must leave so that those who will do the necessary work for the country and the people come, “he said.
–
