Intention of CEZ Distribution Bulgaria for submitting a price application to the KEVR

Pursuant to Article 36a, Para.1 of the Energy Act and Article 46 of the Ordinance ą 1 from 14th of March 2017 on the regulation of the electricity energy prices, CEZ Razpredelenie Bulgaria AD announces its intention to submit not later than 31st of March 2020 to the Energy and Water Regulatory Commission a Price Application for the amendment of the current prices for “Electrical power distribution” for the third price year of the fifth regulatory period, as of 01.07.2020.

The Price Application for the amendment of the current prices for access to the distribution system and transmission through the distribution system shall be prepared in compliance with the Energy Act, Ordinance ą 1 and the Electricity Trading Rules. The Company’s Price Application aims to ensure security of supply and quality service to its customers and provide the necessary funds for the activity under the license, including for extension of the grid and for the ongoing liberalization of the electricity market..

The Price Application of CEZ Razpredelenie Bulgaria AD will reflect the the planed cost for the purchased electicty for recovery of the technological losses, corresponding to the actuall level for 2019 of 8.01%, as well as the planned gross investments for 2020 amounting to BGN 74 million, the balancing costs, the inherent operative expenses of licensing activity and the expected return. For the third price year the Company plans to transmit to the end customers 9,3 TWh electricity through its distribution grid.

The Company will apply the requirements of Ordinance No 1 making annual adjustments: with inflation index determined by the NSI for 2019; the difference between forecasted and realized investments; correction with the difference between the estimated and the actual amount of electricity transmitted to the end customers, as well as the difference between the approved price of BGN 92.85 per MWh and the achieved weighted average market price for purchase of electricity on an organized electricity exchange market.

In case there are amendments in the legal framework or in the requirements of the EWRC, they will be reflected by the Company by the expiration of the deadline for submition of the application.

February 2020