VIENNA, March 19 Austrian energy group EVN
said it will take legal action against Bulgaria if it
is unable to negotiate concessions over an electricity dispute
it says has cost it $66 million.
The company said it had told Bulgaria on Tuesday it would
launch proceedings in an international arbitration court to
safeguard its investments if no deal could be reached in the
next three to six months.
EVN, which supplies and distributes electricity, is obliged
to buy solar energy in Bulgaria at prices above market rates.
The country's electricity regulator has also cut household
prices following mass protests against costly energy and low
"These actions reduce the proceeds from the sale of electric
energy," said EVN, which makes a third of its revenues from
southeastern Europe, the bulk in Bulgaria.
EVN cut its full-year profit outlook last month, partly on
the basis of higher costs in Bulgaria.
It said purchases of solar energy had cost it 100 million
levs ($66 million) since last July and would cost it another 40
million over the next three months.
Solar parks are booming in Bulgaria thanks to incentives
from the government, which has a target to have 16 percent of
its energy coming from renewable sources by 2020.
But high electricity bills, partly due to a surge in
expensive green energy, have prompted nationwide protests in the
European Union's poorest country, toppling the government. Three
people died after setting themselves on fire in protest.
In response, the Bulgarian energy regulator has cut
electricity costs for households by an average of 7 percent,
mainly at the expense of power distributors EVN, Czech CEZ
EVN said a cooling-off period of three to six months would
now start, during which time it would consult and try to
negotiate a settlement over its increased costs.
($1 = 1.5094 Bulgarian levs)
(Reporting by Georgina Prodhan; Additional reporting by
Tsvetelia Tsolova in Sofia; Editing by Charlotte Cooper)