The Energy and Water Regulatory Commission (EWRC) Thursday approved a price of natural gas for December at BGN 146.09 per megawatt hour (MWh), excluding charges for access, transmission, excise duties and VAT, EWRC said in a press release. This is the price at which the state-owned Bulgargaz supplier will sell natural gas to end suppliers and to entities holders of a license for the production and transmission of heating energy. The December gas price is 18.76% higher than the price in November.
EWRC approved the new price after an analysis of the latest up-to-date data and documents submitted by Bulgargaz where the prices of the individual suppliers and the share of their quantities in the overall mix are indicated. The regulator established that the total estimated quantity of natural gas for the domestic market is provided by several different supply sources.
The price mix includes the entire agreed amount of Azeri natural gas delivered to this country via the Bulgaria-Greece gas interconnector, according to the current long-term contract with Azerbaijan. These amounts cover about 27% of Bulgaria's natural gas consumption and are of key importance for achieving good prices of the commodity.
The necessary quantities of gas for December are also provided by pipeline gas, purchased on the Balkan Gas Hub by auction. In addition, Bulgargaz has also included in the price mix quantities of natural gas from the Chiren underground gas storage facility.
One of the main reasons for the price hike is the high price of the Chiren gas. The storage facility was filled up in August and September when the prices at the international gas exchanges hit record-high levels. Another factor is the start the heating season when the price of natural gas increases due to increased consumption, mostly by district heating companies. Yet another factor is the growing gas prices at the international markets in the last days of November.
The calculations of the regulator show that if Bulgargaz had continued to supply natural gas from the Russian company Gazprom Export, the price would have been above BGN 157.00 per MWh.