Bulgaria's parliament freezes power prices for households
SOFIA, Dec 15 (Reuters) - Bulgaria's lawmakers voted on Wednesday to shield households from surging energy costs by freezing their electricity and heating prices at current levels in the European Union's poorest state, a move slammed by power distribution companies.
In the past, rising prices have sparked protests in the Balkan country, where poor households often struggle to pay winter bills.
Bulgaria's independent energy regulator had been discussing raising electricity prices by an average of 11.5% and heating prices by up to 30% for households from Jan. 1, bringing them more in line with the market prices power companies pay.
Parliament, dominated by lawmakers from a ruling coalition that has promised to keep household power prices steady, voted on a moratorium, preventing the price hike for homes.
Bulgaria's power distribution and supply companies, and the grid operator condemned the freeze, saying it could bring down the whole power system and with it the Bulgarian economy. They urged lawmakers to find other ways to support households instead of keeping prices artificially low.
The companies have to buy electricity at much higher market prices to balance power flows. They said they were already in a liquidity crunch since prices soared in September and the hike was only meant to cover their expenses.
A freeze of prices may jeopardise planned repairs and investments in the power grid, they added.
Some energy suppliers have gone bust elsewhere in Europe because price caps stopped them passing on surging wholesale prices to consumers. The benchmark European gas price has rocketed as much as 700% this year.
The parliament is expected to vote on the freeze again on Thursday, but only to limit it until the end of March next year.
Bulgarian companies have urged the new government to find ways to help them cope with the price surge that has hammered a range of power-intensive businesses across the EU.
The average price on the Bulgarian energy bourse's day-ahead platform on Wednesday was 563 levs ($324.22) per MWh, compared to the electricity price set for households of about 115 levs MWh.
($1 = 1.7365 levs)
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