Bulgaria Launches Aid for Industries Hit by Skyrocketing Energy Costs

Bulgaria has announced a new financial scheme to help energy-intensive industries cope with soaring electricity costs. The move comes as global energy prices surge due to recent geopolitical tensions, putting pressure on businesses across the country. The conflict between the US, Israel, and Iran has disrupted oil and natural gas supplies worldwide. Since late February, Brent crude prices have jumped by over 55%, while the TTF natural gas benchmark has risen nearly 60%. These increases have pushed up electricity costs in Bulgaria, where the day-ahead price on the IBEX exchange reached EUR 136.6 per MWh on April 2.

Under the EU's merit order system, electricity prices are tied to natural gas costs. This has hit Bulgarian industries hard, especially those that rely heavily on energy. The government will now compensate businesses for up to 50% of electricity prices exceeding EUR 63 per MWh. The scheme will apply retroactively from July 1, 2025, and aims to protect competitiveness in sectors that contribute 26% of Bulgaria's GDP.

The government's intervention seeks to ease financial strain on key industries during a volatile period. With energy prices remaining high, the compensation plan will help stabilise production costs for businesses across the country. Officials have stressed the importance of keeping industries competitive amid ongoing market uncertainty.