Bulgaria Faces Rising Energy and Water Costs Amidst Policy Concerns

Bulgarian citizens are grappling with increased electricity and water bills, sparking discontent and scrutiny of the caretaker government. These price hikes are not isolated incidents but stem from years of delayed reforms and inconsistent policies within the energy and water sectors. While some attribute the increases to the introduction of the Euro, authorities cite higher consumption and previously made pricing decisions as the primary drivers.

Electricity Price Increases

Electricity prices for households in Bulgaria rose twice in 2025, with an average increase of 8.42% on January 1st and a further 2.58% on July 1st. A significant change implemented on July 1st shifted electricity distribution companies (EPCs) to purchasing electricity on the market through the exchange. These adjustments followed approvals of increased water prices by the Commission for Energy and Water Regulation (KEVR) in December 2024, shortly after the resignation of the Rosen Zhelyazkov government.

Inspections and the Hybrid Model

Following over 2,200 complaints regarding high electricity bills, regulatory bodies such as the Consumer Protection Commission (CCP), KEVR, and the Ombudsman initiated inspections of EPCs. This response echoes past instances, such as during the Boyko Borisov governments, where similar concerns led to investigations by the prosecutor’s office and tax authorities.

The Bulgarian energy industry operates under a “hybrid model,” where a portion of electricity for households is purchased on the free market, while KEVR determines the final price. This system isn’t fully liberalized or regulated, leading to fluctuations in bills influenced by exchange prices. The difference between exchange prices and established prices is covered by the Electricity System Security Fund (ESSF). Suppliers procure electricity at varying prices, and effective mechanisms to protect vulnerable consumers remain lacking, despite the inclusion of a definition of “energy poverty” in the Energy Act in 2023.

Lack of Strategic Planning and Market Distortions

A key issue is the absence of a comprehensive energy strategy. Bulgaria’s last energy strategy expired in 2020, and a latest one has not been implemented. Similarly, the strategy for water supply and sewage management concluded at the end of 2023. This lack of long-term planning allows systems to develop reactively, influenced by lobbying and political interests. Energy subsidies further distort the market, reaching €3.38 billion between 2021 and 2023, according to Greenpeace.

Bulgaria has repeatedly postponed the liberalization of the electricity market, citing concerns about exposing households to high free market prices. However, these prices are indirectly borne by consumers through increased costs on the exchange, grid charges, and supplements for renewable energy sources (RES) and the ESSF.

Kozloduy NPP Disruptions

Disruptions at the Sixth Unit of the Kozloduy Nuclear Power Plant (NPP), a key source of affordable energy, also contributed to the challenges. The unit experienced multiple shutdowns in December 2024 and February 2025 following scheduled repairs, prompting calls for investigation from “Yes, Bulgaria.”

Water Price Increases and Holding Company Scrutiny

New water prices, effective March 1, 2025, have also drawn attention to the Bulgarian Waterworks Holding. Protests erupted in Pleven, where residents face a 7% increase in water costs. Political factions have called for the resignations of KEVR and KZP members appointed by previous governments.

Debate has focused on potential conflicts of interest involving Irena Georgieva, the executive director of the water and sanitation holding, and her husband, Denyo Denev, chairman of the State Agency for National Security (DANS). Georgieva was appointed in August 2022 by President Rumen Radev. GERB has countered by accusing a member of the “Continuing the Change” party of coordinating the price increases with water supply company managers.

Systemic Issues and the Require for Reform

Concerns remain regarding the transparency of fund allocation and financial control within the water sector. Water losses exceed 50% in many regions, and even surpass 70% in some areas. Addressing these issues requires implementing effective strategies and protective measures for vulnerable groups. Without these, high bills for inadequate public services will likely persist, regardless of the governing power.