EU Court Overturns Heat Distribution Formula in Bulgaria: Experts Warn of Chaos in Heating Bills

The European Union’s Court of Justice has once again annulled the existing formula used to calculate energy consumption from building installations in district heating systems. The ruling has sparked renewed debate in the sector, raising concerns over how household bills will be determined this winter.

Kremen Georgiev, chairman of the Association of District Heating Companies, emphasised that the core issue is that at the moment the formula does not exist in practice:

“This is the real problem. For years, there have been legal disputes on this topic, but no one has proposed a specific new solution. It’s easy to say ‘this isn’t correct,’ but what is correct? No one explains how the new formula should look or how bills should actually be calculated.”

According to Georgiev, the previously used formula was the most effective, as it faced no complaints from consumers:
“In practice, the best option was the formula that had proven itself over the years – there were no complaints against it across the country”

The EU court’s decision stated that the formula lacked sufficient transparency and accuracy in measuring individual consumption.

Georgiev clarified, however, that this does not mean consumers were financially disadvantaged:
“The formula is opaque because it is complex and difficult for people outside the energy sector to understand. But that doesn’t mean anyone was misled.”

According to him, adding more coefficients would make the formula even less transparent, while only marginally improving its accuracy.

One of the main issues remains the payment for heat energy from the building installation component. Georgiev reminded that EU judges have not abolished this obligation:
“The court clearly stated that the consumer is obliged to pay for energy from the building installation, as long as it is calculated correctly.”

In public discussions, the focus continues to be on bills and trust in "Sofia District Heating":

"Why do we say there is no trust? Sofia District Heating"Company ('Toplofikatsiya Sofia') has 410,000 residential subscribers. Complaints to the company do not exceed 10,000. That is only a small fraction of the customers. Most people simply do not complain because they have no issues."

Georgiev noted that introducing equal monthly payments has eased the burden on many households:

"Energy consumption in winter is about six times higher than in summer. Therefore, it is reasonable to spread the cost evenly throughout the year – this makes bills predictable and in line with incomes."

"Toplofikatsiya Sofia" continues to face severe financial difficulties, with over 1 billion BGN in debt to public gas supplier "Bulgargaz". There is no market price for heating – it is regulated by the Energy and Water Regulatory Commission, Georgiev explained.

"This is the only heating company that is not privately owned, and the only one with problems. All others in the country have invested in modernisation and reconstruction over the past 20 years," he added.

Georgiev also highlighted that the large-scale repair work in Sofia’s "Druzhba" residential district will have a tangible effect:

"The number of breakdowns will drop drastically. However, funding was only approved in July, so the repair started late. Procurement procedures under the Public Procurement Act cannot be bypassed."

He reassured that the pipes are being installed correctly, despite appearances:

"They are pre-insulated – a metal pipe covered with insulation and a plastic layer. If there is a leak, the water does not escape at the same point but is safely diverted."

Georgiev concluded that it would be best for central heating in Sofia to be switched on after 1 November.