The just-held Balkan Gas Hub has gained competition. Bulgaria will have two gas exchanges

Bulgaria will have two gas exchanges. This is clear from the decisions of the Energy and Water Regulatory Commission (EWRC), taken in closed session on March 25. One of the decisions concerns approval for licensing of the state gas exchange "Gas Hub Balkan" EAD for carrying out the activity "organization of a natural gas exchange market". The issued license is for a maximum period of 35 years, according to Gas Hub Balkan EAD.

The other similar solution applies to the private Bulgarian Energy Trading Platform.

Thus, the newly launched state gas exchange - "Gas Hub Balkan", gained competition.

The two gas exchanges will operate through the same platform - Trayport Global Vision Trading System", a product of TrayportLimited UK, which has developed the most widely used and applied software worldwide for the purpose of transaction administration.

"We are a little surprised and in ignorance," Plamen Pavlov, chairman of the Bulgarian Gas Association, told 3eNews, drawing attention to the need for liquidity. "We are interested in a national liquid gas market," he said, adding that we had to wait.

"Nothing bad. A matter of competition. It all depends on the goal, "said Kiril Temelkov, deputy chairman of the Bulgarian Gas Association and former head of Bulgartransgaz. He also pointed to the need for liquidity. "There is gas, the point is that there is not enough liquidity because we have not yet liberated the market, because there is still a public supplier and regulated prices," he said. Temelkov is inclined to believe that there are currently two gas exchanges on the Bulgarian market, but at the same time pointed out that "it depends on what products will be offered" (short-term, long-term, etc.). According to the expert, it is not worrying that the two exchanges will operate through one platform.

"The strategy in announcing the Balkan Gas Hub was, after announcing the stock exchange, to enter it with certain percentages of strategic investors, but this is not moving," recalled Kiril Temelkov. Therefore, in his words, the appearance of a private stock exchange on the one hand is good, but on the other hand "it depends on how things will go." According to him, the worrying thing is that the new private exchange (Bulgarian Energy Trading Platform) is owned by a person (legal b.r.) and not by traders. In this sense, the expert made a comparison with the Austrian Stock Exchange, based on the Baumgarten gas hub, the possibilities of infrastructure and gas trade, as well as the TTF based on a regional hub. In principle, the gas exchange facilitates trade, upgrades the benefits of infrastructure, he added.

The appearance of the Bulgarian Energy Trading Platform directs the opinion of other experts to appetites not only in the gas sector. They recall that there was a desire to create an alternative electricity exchange, but then the law did not allow. At least the broad name "Bulgarian Energy Trading Platform" points to this, as well as the fact that the persons registered behind this participation are unknown to the people from the gas business in Bulgaria.

"There will undoubtedly be some discomfort, but I hope the emergence of a new private stock exchange will lead to positivism," Temelkov said. He added that it would be "bad if there were other interests behind the stated intentions".

When asked where there are competing gas exchanges in Europe, the expert gave the example of Germany, where they work as trading pools.

The two applications for a license and approval of a business plan of Balkan Gas Hub and Bulgarian Energy Trading Platform were submitted to the Energy and Water Regulatory Commission in July last year. In March this year, they were heard by the regulator in a public discussion.

Bulgarian Energy Trading Platform is a private company with a capital of BGN 50,000, and Balkan Gas Hub is a state-owned company with a capital of BGN 500,000. Both companies rely on trading through the Trayport platform, as well as on clearing services from “Clear X AD”.