Bulgaria Energy Decarbonization Strategy

Integrated National Energy and Climate Plan (INECP) 2020‒30 

Like other EU member states, Bulgaria prepared the INECP in 2019 to outline its climate-mitigation targets and policies through 2030. The main strategies on the energy supply side include reducing the use of coal as an energy source; expanding nuclear capacities; increasing investment in and use of renewable energy sources (RES), such as solar, geothermal and biofuels; and increasing the use of natural gas. 

The demand side of the strategy focuses on improving energy efficiency of buildings and promoting low/no carbon transportation modes (public transport, electric vehicles). Key targets for 2030 include: no net increase in greenhouse gas (GHG) emissions in non-emission trading system (nonETS) sectors compared to 2005, in line with the EU Effort Share Regulation on binding annual GHG emission reductions; a national target of 27.1% for the share of renewable energy within gross final energy; and specific targets for energy efficiency. 

The strategy discusses the authorities’ existing and planned sectoral policies and programs to facilitate progress toward the targets (e.g., an existing program to support building renovations for energy efficiencies, financed by a regular EU program). 

The INECP presents GHG emissions projections through 2030 under two different assumptions. One projection is based on (only) existing policies and measures, including at the EU level. The other projection reflects additional planned policies and measures. EU member states, including Bulgaria, are required to update and report these projections periodically. However, neither projection in the latest submission reflects more recent developments, including measures in Bulgaria’s Recovery and Resilience Plan (RRP), updated plans on nuclear facilities, and most recent developments of EU-level policies, including Fit for 55 and REPowerEU.

All projects from the Decarbonization Strategy of Bulgaria are suitable for U.S. companies with expertise in reduction of carbon emissions (technologies, projects, and equipment) and those experienced in geothermal energy usage, renewable energy resources (RES), batteries for energy storage, and projects for strengthening the electricity transition lines.

Green Transition Measures in Bulgaria’s Recovery and Resilience Plan 

Bulgaria’s RRP aims at accelerating the use of RES and hydrogen, improving energy efficiency, and promoting sustainable mobility. To this end, a large portion of Resilience and Recovery Fund (RRF) resources is allocated to green transition investments. Key measures and investments include: 

1. Reduction of GHGs from the power sector. 
2. Installation of electricity-storage facilities.
3. Increase in production and use of RES. 
4. Exploring geothermal energy usage. 
5. Improvement in energy efficiency in the transport sector. 
6. Renovations to improve energy efficiency of residential and non-residential buildings. 
7. Promoting green hydrogen technology. 
8. Electricity market liberalization. 
9. Reduction of administrative burden and simplification of procedures. 
10. Smart grid improvements and upgrades. 
11. Transitional activities to support asset re-use and training.

Bulgaria has access to multiple sources of funding to help finance the large investment needs required to fulfill its decarbonization plan. The INECP estimated investment needs at EUR 42.7 billion over the 2021-2030 timeframe, equivalent to about half of Bulgaria’s 2021 GDP. Almost three-quarters of this amount was for energy efficiency of household buildings (EUR 11.8 billion), construction of additional nuclear capacity (EUR 10 billion), and transport (EUR 9 billion). Green transition investments in the RRP (EUR 3.7 billion) fills a part of these needs. The policy measures envisaged in the INECP are eligible for external financing from multiple sources, including the EU Multiannual Financing Framework for 2021-27, Invest EU, Modernization Fund, EEA grants and EIB financing, and the EU’s Resilience and Recover Facility, which supports the RRP. National public and private financing are also expected. Translating envisioned policies into more specific measures are key to ensuring the effectiveness of the spending and avoiding unnecessary costs.

For more information on the Bulgarian Authorities’ Decarbonization Strategy contact Emily.Taneva@trade.gov.