“Toplofikatsia Sofia“ is in a state of technical bankruptcy, and its debts are weighing not only on the company but also on Bulgargaz. This was stated by energy analyst Svetomir Nikolov from the Geo-Economics Programme at the Center for the Study of Democracy on “The Interview in NOVA News“.
According to him, the financial problem is not limited to the debts of the capital’s district heating company. Nikolov said the burden is being transferred to the natural gas supplier and from there to the Bulgarian Energy Holding.
Higher gas prices increase business costs
“Toplofikatsia Sofia“ is the country’s largest single consumer of natural gas. Bulgaria’s annual natural gas consumption is around 2.5 billion cubic metres.
The price of natural gas for November is €58.43 per megawatt-hour, excluding excise duty, VAT and fees, following a 32.52% increase compared with the previous month. The price mix also includes quantities under the long-term contract with Azerbaijan, as well as liquefied natural gas.
Nikolov said the contract for supplies from Azerbaijan is one of the reasons why gas prices in Bulgaria remain lower than those in Western Europe. The higher price will affect the costs of companies that use the fuel in their production.
The food industry could be among the affected sectors. The analyst warned that higher production costs create the conditions for some food products to become more expensive.
Heating bills do not change automatically
According to Nikolov, the increase in the price of natural gas will not automatically lead to a change in households’ heating and electricity bills. The reason is that regulated prices are set on an annual basis, while the price of gas is approved every month.
“The best energy is the energy saved,“ said Svetomir Nikolov.He recommended that households looking for ways to limit their heating costs invest in energy efficiency. The measures he cited include replacing window frames and installing external or internal insulation.
Sources: nova.bg, dariknews.bg