Energy Efficiency Review of Bulgaria

David Taylor

Findings and Recommendations of the Energy Charter

In-depth Review of Bulgarian Energy Efficiency Policy

 

David Taylor, Ireland, Chair of the Review Team

 

Sofia, October 2008

Structure of Report

Situation• Background• Policy• Activity

Assessment

Recommendations

Sources of Information

• In – Depth and Regular Reviews

• Bulgarian Government Publications

• IEA and ODSSEE-MURE statistics

• Presentations from Bulgarian Institutions

Review Team

David Taylor Sustainable Energy Ireland

Inguna Ozolina Latvian Energy Agency

Herbert Lechner Austrian Energy Agency

Mr. Peter Nielson Danish Energy Authority.

Valya Peeva Energy Charter Secretariat

Wolfgang Eichhammer Consultant to the Secretariat

Final Energy Consumption FEC

Sector % Share of FEC

Industry 36

Transport 30

Residential 22

Services 9

Agriculture 3

Industry Sector

Sub Sector % Share of FEC % GVA

Chemicals & Petrochemicals

28

Iron and Steel 17

Non Metallic Minerals 18

Subtotal 63 23

Balance 37 77

Total 100 100

Transport Sector

Car Statistics

• Stock Increase +60% or 1.0 million• Ownership 330 cars per 1,000 population• Average Age 40% are over 20 years old

24% are 16-20 years old

Residential Sector

Housing Statistics

• Permanently occupied 2.82m• Private Ownership 92%• Central Heating 42%• Appts in “Panel” buildings 40%

• Average Area 63.5m2

• New build rate 13,000pa

Residential Sector Heat

Heat Source % Final Energy in Heat Provision

Wood 35

District Heating 30

Coal 23

Electricity 12

Energy Policy

• Energy Strategy • Adopted by Parliament July 2006

• Energy Law 2003 – legal, operational, accounting, unbundling

• Chapter 10 D/ Heating billing• Chapter 11 RES-E and CHP• Amended 2006, March 2008

• Energy Market Liberalisation• SERC established 1999• Unbundling in Electricity and Gas• Privatisation of operational units

Energy Pricing Policy

• Market liberalised• Privatisation well advanced

• Pricing Policy• Liquid fuels and coal set by market• Electricity, heat, natural gas subject to regulation

• Prices• Electricity prices are 35% to 50%(In) EU average• Gas prices are 50% (Res) to 60% of EU average

Institutions of Energy Policy

• Ministry of Economy and Energy

• State Energy and Water Regulatory Commission (SEWRC)

• Electricity System Operator (ESO EAD)

Energy Efficiency Policies and Programmes

• Energy Efficiency Act – February 2004• Amended 2006 and 2007

• Energy Efficiency Agency• Responsibilities, Targets, Powers

• First National Energy Efficiency Action Plan

• National Programmes• EE short and long term programmes under the EE Act• Sectoral EE programmes for Building, transport and SMEs

Energy Efficiency Programmes by Sector

Residential Sector• Measures linked to EU Accession• Measures in Support of Thermal Performances of

Homes• Subsidies and fiscal measures

District Heating• Modernisation of the Network

Energy Efficiency Programmes by Sector

Industry and Tertiary Sector• Energy management with efficiency and audit focus• Grants to support energy management• Energy management in Municipalities

Transport Sector • Mandatory measures• Taxation measures

Organisation of Energy Efficiency Activities

• Ministry of Economy and Energy• Form EE and Environment Protection Division• Legislative initiative, implementation control

• Energy Efficiency Agency• Executive Agency, Established 2002• Mandate flows from Energy Efficiency Act• Enlarged mandate and responsibilities

• Ministry of Regional Development and Public Works• Regional and Local Authorities - Others

Financing Energy Efficiency

• Sources of Funds• Ten principal sources• Commercial banks, state, EU and international aid

• Funding Schemes• Five principal schemes• Sectoral, revolving project and credit lines

• Grant funding• Four EU Operational Programmes (OP)• Economic, development, transport, environment

Renewable Energy PolicyRES-E

• Targets• 2010 11% of RE in electricity consumption• 2020 16% in draft EU Directive

• Potential• Biomass and Wind• Geothermal and Solar

• Incentives• Feed in tariffs

Market response

Capacity

MW

Hydro Wind

PV

Requests for licenses

7 800 51

Licenses issued

7 620 26

Requested grid connection capacity

90 2257 76

Recommendations - General

• Ample evidence of a structured approach

• Not clear that the resources required are available

• Significant progress in implementing EU Directives

• Continued efforts necessary

• Low income groups are vulnerable

• Sensitive and sustainable EE measures required

• Energy market reform well advanced

• Look to ESD for enabling EE market opportunities

RecommendationsEnergy Efficiency Policy

• Deliver Energy Efficiency Action Plan (NEEAP)

• Focus on pace and co-ordination

• Monitor Implementation of NEEAP

• Adjust in the light of progress

• Engage market actors

• Review interaction of measures

• Balance objectives and pathways

RecommendationsLegal Framework and Energy Markets

• Legal Framework• Enact “Condominium” Law• Monitor success

• Energy markets• Stimulate PPPs and ESCOs• Structure for sustainable energy services to appts

RecommendationsInstitutional framework

• Ministry of Economy and Energy• Build implementation capacity• Secure resources in line with EE Act

• Energy Efficiency Agency• Enhance capacity to analyse and act on audits• Add value through promotional activities

• Local Actors• Strengthen LEA and Energy Officers in

Municipalities

RecommendationsEnergy Efficiency Funding

• Raise awareness of existing funds

• Position for additional OP funding at review

• Build on success of revolving funds (BgEEF)

• Test a variety of approaches to “Panel “ buildings

• Maximise Kyoto JI up to 2012

Recommendations SectoralBuilt Environment

• Facilitate improvements to energy performance of building stock

• Promote legal structures for energy service provision to “panel” and other multi-family buildings

• Monitor and assess true costs of electricity use for heating

• Ensure appropriate standards for heating appliances e.g. heat pumps, are in place

• Promote building energy rating

Recommendations - SectoralIndustry

• Evaluate audit results to date

• Promote replication of lessons learned

• Build networks for Energy Managers

Recommendations- SectoralTransport

• Fiscal measures targeting purchase and use

• Sustainable planning and infrastructure provision

• Public transport infrastructure investment

RecommendationsEnergy Supply

District Heating Secure in the short term

Expand in the medium term

CHP Increase share in heat generation

Introduce biomass as a fuel

Gasification Balanced approach to competition with others networks e.g. District Heating

Renewable Electricity

Monitor price impacts

Weigh costs against other options

Biomass Ensure strategy in place

RecommendationsData Collection and Monitoring

• Monitor and Evaluate Energy Efficiency Actions• Develop the capacity to make forecasts• Publish results• Develop Energy Efficiency Agency’s Capacity

• People• Software• Hardware

Conclusion

• The Team would like to express its thanks to

• The Bulgarian Authorities and the EEA in Particular

• The Energy Charter Secretariat, and our

• Rapporteur Wolfgang Eichhammer