1. Energy and Water Regulatory Commission (EWRC)
Regulatory Framework in Bulgaria
11th Assembly Meeting
15thMarch 2017,Grand Hotel Sofia,
Sofia, Bulgaria

2. Energy and Water Regulatory Commission
Multi-Sector regulator:
Energy (Electricity, Central Heating, Gas): since 1999
Water: since 2006
Since March 2015:
Commission of 9 members
Chosen by the Parliament
Sub-panel for Electricity: Chairman, Lawyer, Economist, 4 Members with energy expertise
Sub-panel for Water: Chairman, Lawyer, Economist, 2 Members with water expertise
No of staff: 166 people (members + administration), not all appointed
Water and Sanitation Directorate:
26 people, not all appointed
2 departments: Prices and Business plans, Control and Dispute Resolution
2 regional units, not appointed

3. General Framework for Water and Sanitation (WS) Sector
2000: Water Act
2005: Regulation of Water and Sanitation Services Act
2006: WS Services Quality and WS Services Price Regulation Ordinances
2009: Changes in Water Act (Water reform beginning)
2014: WS Sector Strategy
2016: NEW WS Services Quality and Price Regulation Ordinances
1st regulatory period: (3 years length, Cost Plus price regulation).
2nd regulatory period: (5 years length, Price Cap regulation).
Extension of the 2nd regulatory period: due to reform.
3rd regulatory period: (based on the new ordinances).
Population: people (2011)
28 administrative regions
265 local municipalities
51 water companies (29 state-owned, 21 municipal-owned, 1 PPP)
Other public or private companies operate
2000 – Law on Waters; Law on Spatial Planning; 2005 – Law on Regulation Water Supply and Sewerage Services; 2006 – Ordinance on long-term rates, terms and conditions for the formation of the annual target levels for quality of water supply and sewerage services; Ordinance on regulation the prices of water supply and sewerage services; 2006 – Regulator's Guidelines for the implementation of both stated ordinances; General terms and conditions for the provision of water and sewerage services by WSS –operators; **Ordinance № 4/2004 on the conditions and procedure for connecting consumers and use of WSS systems Ordinance № 9/2001 on the quality of water for drinking and domestic purposes etc.

4. KEY STAKEHOLDERS IN WS SECTOR
Ministry of Environment and Water (MOEW)
Water management on national level, National water strategy (2012), EU operational programs management, licenses for water taken and discharge, control on wastewater quality
Ministry of Regional Development and Public Works (MRDPW)
Legislation framework for the WS sector, WS sector strategy (2014), coordination of water system management and planning and WA work, principal of the state-owned WSOs
Ministry of Health (MH)
Control on the potable water quality
Water Associations (WA)
WA manage the WS public assets in areas of more than 1 local municipality, assign contract with WSO, prepare investment programs and approve WSO business plan
Local Municipalities (LM)
LM manage the WS public assets in areas of only 1 municipality, assign contract with WSO, prepare investment programs and approve WSO business plan
Energy and Water Regulatory Commission (EWRC)
EWRC regulates quality and prices of WS services
Water and Sanitation Operators (WSOs)
WSOs operate the WS assets and supply WS services

5. KEY STAKEHOLDERS IN WS SECTOR

6. WS Sector Reform
OP “Environment ”: Project Beneficiaries – Local Municipalities
Water Act Changes from 2009:
Transfer of WS assets from balance-sheet of the WSOs to the State/Municipalities (public assets);
Definition of discrete areas of 51 WSOs (29 state-owned, 21 municipal-owned, 1 PPP)
Other municipal or private WSOs still exists
Establishment of Water Association for the discrete areas of WSOs, that include more than one municipality for WS asset management
Contract between WA and WSO – 2 options: Water Act / Concession Act
May 2014: New WS Sector Strategy ( ), prepared by World Bank:
Investment achieved: < 200 MLN BGN/year, needed > 800 MLN BGN/year
Investment needs for 10 years: 11,7 BLN BGN
Consolidation of WSOs
OP “Environment ”:
Project Beneficiaries: Regional WSOs
Only regional projects will be financed
Waste water collection and treatment – only for agglomerations > 10,000 e.p.
Energy and Water Regulatory Commission of Bulgaria, Regulators` Conference EXPO-APA, Bucharest, Romania,

7. Regulatory Regime Regulation of Water and Sanitation Services Act:
No licensing regime. Only business plans approval
15 main KPIs (developed in the ordinance), long-term levels
EWRC can either approve BP, or to require its change by the WSO
Price regulation: Cost Plus for first period, Price Cap/Revenue Cap for 5-years periods
BP approval: requirement for price approval
NEW WS Services Quality Regulation Ordinance
KPIs: reduced to 30 from 76
Long-term levels of KPIs set individual for each WSO
Separation of WSOs in 4 groups: large, middle, small, micro
Assessment of quality of information provided by WSOs
Assessment of performance on the levels of KPIs
Annual report from EWRC for BP implementation of each WSO and WS sector analysis
NEW WS Services Price Regulation Ordinance
Consolidation of BP and Tariff approval in one procedure
Approval of the BP and approval of price for the 1st year
Setting prices for the next 4 years, corrected +I – X (Price Cap / Revenue Cap)
Financial stimulus / corrections if KPIs not achieved (pre-defined 5 KPIs for the regulatory period)
Option to apply coefficients in X after 3rd year if no investments are made / KPIs not achieved
Clear definition when BP/Tariffs can be updated during the regulatory period.

8. Current status, medium and long-term goals

9. THANK YOU FOR YOUR ATTENTION!