Price of natural gas in November will rise to BGN 82.12 per MWh

The Energy and Water Regulatory Commission approved the natural gas price for November at BGN 82.12/MWh, excluding access, transmission, excise and VAT. At this price, public supplier Bulgargaz will sell natural gas to the final suppliers and to entities that have been issued a license for generation and transmission of heat.

The approved price of natural gas includes the component of the price of natural gas at the input of the gas transmission networks, the component for the activity "public supply" under Art. 17, para. 7 of the ordinance on regulating the prices of natural gas and the cost compensation component under Article 11a(2) of the ordinance, covering the costs of Bulgargaz EAD for storing volumes in the gas storage facility in Chiren, in fulfilment of obligations under the Contingency Plan.

The Commission approved the price following an analysis of the updated data submitted today, November 1, by Bulgargaz EAD, which form the natural gas price for November. They take into account quotations on international gas markets up to and including 31 October this year.

The regulator found that the total estimated quantity for the domestic market is provided by four different supply sources. The price mix for November includes the entire contracted quantity of Azeri natural gas supplied via the Bulgaria-Greece interconnector /IGB/, according to the existing long-term contract with Azerbaijan. These quantities cover 35.64% of consumption for the month and are key to achieving favourable prices for blue fuel.

"Bulgargaz has concluded three LNG supply contracts for November with traders in the region, following a tender procedure, with minimum delivery price requirements and a proposed payment method.

The volumes secured will cover the public supplier's commitments for November - to final suppliers and district heating companies, as well as the volumes under bilateral contracts with industrial customers.

The confirmed price of 82.12 BGN/MWh is 36% higher than the price of natural gas in October, which was 60.41 BGN/MWh. Despite the unfavourable price factors, the regulated price for November is more than 10% lower than the European gas market price for November.

"Although gas supplied from Azerbaijan decreases as a relative share in total volumes during the winter months, it remains a favourable factor for Bulgaria as its price is not linked to prices on international gas markets. Thanks to this, the price of gas for Bulgarian consumers - domestic and commercial - remains significantly lower compared to other European countries", said the Chairman of the utilities regulator, Assoc.Prof. Ivan Ivanov at the open meeting.

According to him, the main factors with a significant impact on the regulated gas price are the significant growth of the TTF "month ahead" pricing index for November, the increased supply volumes for the upcoming heating season and the negative impact of the military conflicts in Ukraine and the Middle East on the market prices of blue fuel.

EWRC's decision to approve the natural gas price for November 2023 will be published on the regulator's website.

Source: BGNES