Bulgaria’s national gird operator NEK will have to renegotiate or fully pay back the 250 million euro loan to finance the construction of the Belene nuclear power plant as its six-month loss have technically rendered it subject to immediate repayment, Energy Minister Traicho Traikov said on August 25 2009.

The funding from BNP Paribas, which was agreed two years ago to use before ground-breaking, is due back by 2012.

Traikov blamed the deterioration in NEK’s financial performance on reduced power consumption as customers grapple with the economic recession and said it caused a delay in payments.

He said that unless the company complies with the terms of the loan agreement, the Government would have to dip into the fiscal reserve to repay the loan. This could be considered as state aid and therefore NEK will seek revision of the terms and conditions, he said.

The State Water and Energy Regulatory Commission (SEWRC) has opposed to plans to renegotiate the loan, claiming this would entail a drastic increase in interest rates. Jacking up the rate to 10 to 11 per cent would trigger a loss of eight million to 20 million euro for the grid operator, according to SEWRC chairperson Konstantin Shushulov.

Tencho Popov, deputy chairperson of the Bulgarian Energy Holding (BEH) - the megastructure encompassing the country’s top energy assets, including NEK – laid the bulk of the blame for the disappointing results at the door of the company’s two executive directors, who he said had been sitting on their hands.

Lyubomir Velkov and Mardik Papazyan said in a media statement that they had informed the regulator, the then-energy minister and BEH executive director Galina Tosheva of the looming loss in May 2009, but their warnings had fallen on deaf ears. Shushulov pinned the decline on lower consumption and shrinking sales and exports.

Source: Dnevnik.bg