
Bulgaria steelmakers continue production despite electricity costs
Bulgaria’s metallurgy industry will not stop production despite restrictively high electricity prices, Bulgarian Association of the Metallurgical Industry (BAMI) executive director Politimi Paunova tells Kallanish.
“I hope this is a temporary critical situation caused by high electricity prices and the authorities will continue the compensation scheme for businesses that was in effect until the end of 2024,” she says. “After a reaction from the national employers’ organisations, a solution is expected as soon as possible. Companies, albeit with some delay, should receive the relevant financial aid.”
Bulgarian metallurgical companies continue to operate and there is no information yet about shutdowns, Paunova adds.
“The future not only of Bulgarian metallurgy, but also of the entire European energy-intensive industry depends on energy prices and their comparability with other competitive producers in the world,” the BAMI executive director notes. “At this stage, compensation for businesses is imperative and is not expected to be discontinued in the next few years. Under these conditions, Bulgarian metallurgy, as well as other sectors of industry, can operate and be competitive.”
Paunova points out that stopping production altogether would lead to very high costs when restarting the lines, so steel companies prefer to reduce production to consume less electricity, which results in losses.
Bulgaria’s main employers’ organisations received assurances this week from all political parties in the National Assembly that the mechanism for 100% compensation of companies’ costs at prices above BGN 180 ($94) per megawatt-hour will be continued this year.
Last Friday, the chairman of the Bulgarian Electricity and Gas Association (AIKB), Vasil Velev, called on businesses not to rush to pass the new, still unsubsidised price of electricity in January on to prices of their products and services. Since the beginning of the month, electricity prices have averaged over BGN 250 per megawatt-hour.
On Monday, Velev called on producers not to stop work due to high electricity prices as he is confident the compensation mechanism will be continued.
In January-November, Bulgaria saw crude steel output fall by 3.5% on-year to 426,800 tonnes, according to worldsteel latest data.
Svetoslav Abrossimov Bulgaria