Power Distributors Face Fines for Accounting Irregularities

Power Distributors Face Fines for Accounting Irregularities

Bulgaria's energy regulator said on Wednesday it plans to fine the local power distribution units of Czech companies CEZ and Energo-Pro, and Austria's EVN over accounting and other irregularities.
The move comes against the backdrop of an ongoing procedure for the revocation of the three companies' licences.
Following a series of checks at CEZ Razpredelenie Bulgaria, EVN Bulgaria Elektrorazpredelenie and Energo-Pro Grid, the regulator established that the companies have been paying unjustified commission fees to affiliates and reporting inflated costs for consultancy services, the State Energy and Water Regulatory Commission (SEWRC) said in a statement posted on its website.
The regulator established a combined 2,690 violations at the three companies over the 2008-2012 period, as the bulk were related to the replacing of electricity meters. SEWRC established a number of violations related to substandard power supplies, as well.
The three companies have overstated their costs, exceeding by 818 million levs ($573.7 million/418.2 million euro) in total the relevant cap set by the regulator, it said.
Earlier in the day, state-run news agency BTA reported that each violation carries a fine of between 20,000 and 1.0 million levs.
CEZ Razpredelenie Bulgaria, EVN Bulgaria Elektrorazpredelenie and Energo-Pro Grid may appeal each statements within a three-day period.
A day earlier, Bulgaria's competition regulator said the three power distribution companies are abusing their dominant position on the local market, charging unreasonably high prices for access to their low voltage overhead power distribution network, thus restricting and preventing competition.
The three companies denied any wrongdoing, saying they will file their objections to the competition regulator's decision within the law-prescribed time-frame.
In April, SEWRC launched a procedure to revoke the licences of the three power distributors after it was notified by the state-owned power utility NEK that they owe it a total of over 347.6 million levs  in outstanding payments.
The power distributors have said they owe debt-ridden NEK nothing, claiming that it had failed to pay them compensations for being obliged to buy electricity generated by wind and solar power installations.

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