The measures presented by the caretaker cabinet to help deal with the crisis after the war in the Middle East are better targeted than previous ones, but in principle the subsidies remain problematic.
This was said by economist Assoc. Prof. Grigor Sariyski, Institute for Economic Research at the Bulgarian Academy of Sciences in the studio of "Speak Now".
The positive thing about the new measures is that an attempt is being made to target vulnerable groups, unlike in 2022.
However, he remains skeptical about the way in which enterprises will be supported.
„You cannot treat all energy-intensive enterprises under the same umbrella. Purely and simply, because due to the market situation, some profit, and others – not so much."
According to him, the state has been postponing the creation of clear rules for support for years, since at the beginning of 2022 all non-household consumers, including banks, received aid. Grigor Sariyski emphasized that the very logic of support contradicts market principles:
„A subsidy is something that is non-market. If we are going to talk about a market - either we leave enterprises to fend for themselves, or if we introduce subsidies, they must be granted under strictly defined criteria."
The lack of a definition of "energy poverty" also remains a problem. The economist explained that the Institute for Economic Research has developed an even broader index - energy vulnerability, which takes into account a number of factors - income, unemployment, climate and housing condition. According to him, nearly 30% of the population in Bulgaria falls into the category of energy vulnerable, and the problem is not limited to smaller settlements. He pointed out that there is also the so-called “hidden energy poverty“:
“People reduce their electricity consumption to a minimum simply because they cannot afford the costs.”, said Sariyski.
Sofia, Razgrad and Veliko Tarnovo are among the districts with the highest energy costs and struggling households, and the victims of the cold weather are nearly 4,000 each year. This is shown by data from the National Map of Energy Vulnerability of Households in Bulgaria, developed by WWF and the Bulgarian Academy of Sciences.