Bulgaria: The highest price in Europe on IBEX day-ahead market

, SEE Energy News

In Bulgaria and throughout Europe, high electricity prices have been recorded continuously since the end of March, which is extremely atypical for this time of year. On 17 April, Bulgaria recorded the highest electricity prices on the day-ahead market in the whole of Europe. One of the reasons for that is the start of the planned overhaul of NPP Kozloduy, but also the high prices of CO2 emissions for coal-fired thermal power plants, which further increase the cost of electricity production.

After a week of continuous growth in electricity prices, Bulgaria set an absolute record for weekends on Saturday and overtook all European countries – IBEX day-ahead price reached close to 76 euros/MWh. In comparison, the next highest price on the continent was in Greece at 68 euros/MWh, but it includes additional fees, which are charged after the delivery in Bulgaria.

One of the main reasons for the increase in the price of electricity on the Bulgarian market is the overhaul of unit 5 at NPP Kozloduy, which began on 17 April and will last for 43 days. This means that there is 1,000 MW less in the system. However, this is not something novel, each of Kozloduy’s units is taken offline once a year regularly, so it should not create such a distortion in the market.

Now, however, there is a combination of several other factors. The first one is regular overhauls of several nuclear power plants in Central Europe (in the Czech Republic and Slovenia), and wind and solar power plants in Germany and Denmark are not operating at full capacity due to weather conditions.

This calls for replacement capacities, which are most often coal-fired or gas-fired thermal power plants. Then another factor appears – the price of carbon emissions. Since the beginning of April, CO2 emission prices have twice broken the historical record, with the highest value so far of 44.39 euros/ton, achieved on 12 April. This is a significant increase compared to 30 euros/ton in January and 20 euros/ton in this period last year. Given that the emission fees make up on average about 50 % of the cost of electricity produced in thermal power plants, with rising CO2 emissions, the price of electricity from coal has increased by at least 50 %.