Under the Bulgarian Energy Law and the Ordinance for licensing the activities in energy sector, electricity-producers from power plants with total capacity, exceeding 5 MW, are subject to licensing by SEWRC.

Based on the issued license, the producer can sell the energy generated from the power plant, after initiation of the license activity SEWRC has the right to control the subsequent execution of dispositive deals by the manufacturer with the power plant – subject of license. The producer is obliged to request permission from SEWRC for dispositive deals, pledges, mortgages and changes in the circumstances of the company – owner of the power plant.

Conditions for issuance of license, before the construction of energy site.

The license is issued to a legal person under the Commercial Law, or such registered in another EU member state, or another state part of the European Economic Zone.

The procedure begins with preparation of documents and applications to SEWRC.

License application must include:

company information, type of license requested, a description and technical parameters of the future energy site, a detailed time schedule for construction of the object, data for requested or held by the manufacturer other licenses for other activities under the Energy Law.

Other documents attached to the application are:

• Current state of the company
• Tax registration certificate of the company
• Declaration:

- that the applicant is not in bankruptcy proceedings.

- that the applicant hasn’t revoked license for the same activity.

- that more than 3 months are passed from an existing SEWRC refusal to issue a license to the applicant for the same activity.

• Financial statements for the last 3 years.
• For a newly established company, it’s also required a proof of financial resources and details for the sources of invests in the object, such data may be a credit letter or a contract for project financing, and when using own capital – decision by the Governing Body.
• Details for the shareholders of the applicant. Statutes, judicial decisions or register of the shareholders.
• Data for the applicant experience or his partners, or his shareholders, in developing similar type of activity.
• Technical or conceptual design of the site prepared or approved under the Spatial Planning Law.
• Investment analysis and financial model to forecast electricity prices.
• Preliminary contract with the electricity transmission or distribution company to join the grid.
• Business plan.
• Assessment of availability and estimated potential of company resources; Document for paid fee for consideration of the application.

After submitting all documents within 3 months SEWRC decides to issue a license before the construction of energy facilities, based on financial capacity of the applicant and his rejoinder of criteria for issuing the license. The period for initiation of licensed activities and the conditions for construction of energy facilities are determined in the license.

After construction and putting into service of the facility, the licensee must provide to SEWRC, the following documents:

• Document for the introduction of construction in operation (Act 16).
• Details for technical and operational characteristics of the site and adjacent infrastructure.
• Documents evidencing ownership or other property right.
• Evidence for assigned personnel and their qualifications.
• Updated business plan and financial model.

Within one month from provision of documents SEWRC issues a decision for initiation of the licensed activity or a decision to revoke the license, as in disparities in the documents, issues instructions for their removal.

Fees for licensing.

• Submitting of application - 500 Euro.
• When granting a license:

- initial fee - 7500 Euro

- annual fee - 1000 Euro + 0.05% of annual revenues of the company from the licensed activity and 0.02% of the investment value by license terms.

• For amending or supplementing the license - 1500 Euro

In the issued license are recorded:

The state authority issued the license, name and register number of the act, legal bases for the issued license, data for licensee, activity for which the license was issued, term of license, naming the site – subject to licensing, special conditions for carrying out activities determined by SEWRC.

Term of the license.

SEWRC determines the term of the license based on the time resource of assets and the financial state of the applicant. The term is between 1 and 35 years, SCEWR can’t set a term bigger than requested by the applicant.

Lawyer`s Office Tomovski