"District Heating – Sofia" is in free fall. The heating of Sofia residents is paid for by the taxes of all Bulgarians. If "District Heating – Sofia" stops, the energy system will not last. The company is probably being deliberately led to bankruptcy.
This was warned to the Bulgarian National Radio by Georgi Kadiev, a financier, former deputy minister of finance. Years ago, he was part of the management of the district heating company.
If "District Heating – Sofia" stops, the energy system will not last. We cannot do without "District Heating – Sofia". The question is how to reverse the trend and have it start making a profit, rather than accumulating debt, he explained.
According to him, in theory there is a risk for the heating season if "Bulgargaz" asks for its money and stops gas supplies, which, however, has never happened and will not happen now.
"Toplofikatsiya – Sofia" sells at a price that is not market - set by the Energy Regulatory Commission, but buys gas at a market price, the financier recalled.
If the company sells on the free market, the risk is that prices will jump significantly. The other option is to look for alternative gas supplies, because 70% of "Toplofikatsiya – Sofia"'s expenses are for gas, noted Georgi Kadiev.
"They could have done cogeneration, additional, to produce electricity. And they didn't do that.
They could have separated part of the company, given it to a private owner and seen if it would do better than the state," Kadiev suggested as a third option.
The heating for Sofia residents is paid for by the taxes of all Bulgarians, he stressed.
Describing the situation with "Toplofikatsiya – Sofia" as "slurry", Kadiev did not rule out deliberately leading the company to bankruptcy so that it could be privatized "by some Bulgarian strategic investor".