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Policy Forum: Energy and Good Governance in Bulgaria: Trends and Policy Options
 
On 18 January 2011 the Center for the Study of Democracy presented its latest report Energy and Good Governance in Bulgaria: Trends and Policy Options at the National Assembly of the Republic of Bulgaria.

Mr. Traicho Traikov, Minister of Economy, Energy and Tourism, Mr. Martin Dimitrov, Chairman of the Economic Policy, Energy and Tourism Committee at the National Assembly, H.E the Ambassador of Norway and H.E the Ambassador of Hungary in Sofia, the Head of the International Secretariat of the Extractive Industries Transparency Initiative Mr. Jonas Moberg, the Director of the Sofia Office of Konrad Adenauer Foundation Mr. Andreas von Below, representatives of the National Assembly and other stakeholders took part in the discussion.

Dr. Ognian Shentov, Chairman of the Center for the Study of Democracy opened the debate. He underlined CSD’s multiannual work on governance issues and highlighted some positive steps in the energy sector that occurred in 2010. One of these steps was, for instance, the setting up of a good dialogue for developing Bulgaria’s Energy Strategy through the inclusion of multiple stakeholders in the debate. At the same time Dr. Shentov listed the numerous challenges that the Bulgarian government faces during the current year, such as: the improving of energy security, the drafting and adoption of a clear long-term and medium-term energy strategy with realistic priorities, the successful management of key energy projects and state-owned enterprises, and the implementation of strategic, legislative and organizational changes aimed at better management of the sector.

H.E. Tove Skarstein, Ambassador of Norway to Bulgaria expressed her satisfaction with the discussion on energy governance, which the Norwegian Government supported through the Norwegian Co-operation Programme for Economic Growth and Sustainable Development in Bulgaria. It was noted that, albeit slowly, Bulgaria has demonstrated tangible progress in improving the transparency of the energy sector. As a leader, and one of the originators, of the idea of sustainable development Norway has long experience in building a system of good governance and it is ready to share this experience with Bulgaria so as to help the country to fully integrate into the EU.

Mr. Martin Dimitrov, Chairman of the Economic Policy, Energy and Tourism Committee at the National Assembly emphasized repeatedly the need for a speedy adoption of the Energy Strategy of Bulgaria, voicing strong criticism against the practice of taking decisions on major energy infrastructure projects without a clear strategic vision. He therefore called for the immediate adoption of the strategy. Mr. Dimitrov stated, however, that Bulgaria does not have the necessary resources to implement all planned energy infrastructure projects. This requires the prioritization of energy projects based on their profitability for the country. He criticized the decision-making on major energy projects, such as Belene Nuclear Power Plant, as lacking adequate strategic and financial rationale and expressed his concern that there is pressure to launch the project before the adoption of the Energy Strategy and before the adoption of the changes in the Energy Law.

Mr. Traicho Traikov, Minister of Economy, Energy and Tourism pointed out that, for the first time in 20 years, energy decisions are subject to such an extensive discussion among experts as well as among the general public. Minister Traikov noted that the discussion of the proposal for the new energy strategy is about to commence, which is indicative of the government's strong commitment to transparency. According to Minister Traikov, CSD’s report clearly and accurately describes the energy situation in Bulgaria. As the process of building a better governance structure is long, Minister Traikov stated that government’s efforts in 2011 will be aimed at restructuring the management of state energy companies, balanced inclusion of renewable energy sources in the network, as well as implementation of important national energy projects.

Mr. Ruslan Stefanov, Director of the Economic Program at the Center for the Study of Democracy presented the main conclusions and recommendations of the report. He particularly noted the mismanagement of energy companies and the irregularities in public procurement contracts in the energy sector. He emphasized the point that the implementation of strategic, legislative and organizational reforms aimed at better management of the sector may not be effective without effective prosecution and penalties for abuses of power in the management of major energy projects and energy company funds. The report outlines the main priorities for the energy sector in Bulgaria, based on cost-benefit analysis. It pays particular attention to the process of public procurement in the energy sector and the associated risks of corruption practices. Lastly, the report presents recommendations for improving the management of the sector, including the establishment of a system for public monitoring and control.

Mr. Jonas Moberg, Head of the International Secretariat, Extractive Industries Transparency Initiative (EITI), stated that the report of the Center for the Study of Democracy clearly describes some of the main problems in the energy sector of Bulgaria. Mr. Moberg expressed his satisfaction with the stated willingness of Minister Traikov and Mr. Martin Dimitrov to join EITI and he shared their faith that such an initiative will significantly increase the transparency of the sector. According to Mr. Moberg, greater transparency in decision-making will not only help reduce corruption in the energy sector, but it will also enhance public confidence in the government. By joining the Extractive Industries Transparency Initiative, Bulgaria has the opportunity to emerge as a leader in achieving a transparent process of governance in the region.

Mr. Andreas von Below, Director of the Sofia Office of Konrad Adenauer Foundation acknowledged CSD’s report as a timely warning of the risks in the management of the Bulgarian energy sector and stressed that the ultimate goal of the EU is to achieve energy security, both in individual Member States, as well as in the region as a whole. Mr. von Below shared the experience of Germany in this regard and called for greater transparency of decisions in the Bulgarian energy sector, especially given the fact that many infrastructure projects in Bulgaria are carried out with EU funds.

Mr. Jordan Georgiev, Executive Director of the Bulgarian Energy Holding, Mr. Valentin Kanev, Chairman of the Balkan and Black Sea Petroleum Association, Mr. Rumen Ovcharov, MP and other participants took part in the discussion that followed the presentations of the main speakers.









Agenda (Adobe PDF, 72 KB)
Presentation by Mr. Ruslan Stefanov, Director of CSD’s Economic Program (MS Power Point, 1.3 MB)
Report: Energy and Good Governance in Bulgaria. Trends and Policy Options
Press release (Adobe PDF, 161 KB)
Media Coverage (in Bulgarian)
 
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