Bobov Dol thermal power plant, the 630 MW coal-fired plant in southwest Bulgaria, near Sofia, was sold to the company Energia MK, controlled by local businessman Hristo Kovachki, on June 26.
The sale went to Energia Mk, which paid only the opening amount of 100 million leva because the other bidder in the auction, Minna Komania, another company of Kovachki’s, had failed to bring the payment document for the deposited bank guarantee of five million leva.
The money Kovachki paid was 38 million leva less than the amount agreed with Greek company Sencap, owned by Greece’s Public Power Corporation (PPC), one of five companies that bought tender papers in 2007. PPC was ready to pay 71 million euro for Bobov Dol thermal power plant.
As previously reported by The Sofia Echo, the Bulgarian Privatisation Agency (PA) cancelled its negotiations with PPC in May 2007 after the company had spent more than a year in talks with nearby mines without reaching an agreement. Without setting any specific limits, the PA insisted that PPC buy at least part of the coal it would use at the power plant from the mines in the Bobov Dol area. PPC then sued the agency, but a Bulgarian court dismissed its claim against the cancellation of the previous tender from April 2008.
After seeing the PA’s new requirements, PPC sources said that “the current procedure gives an advantage to an exact group of buyers,” Bulgarian-language weekly Kapital reported. PPC said it planned to take its case to the European Union because, according to the company, the procedure does not guarantee an honest and transparent privatisation process. However, none of the other bidders complained to the Competition Protection Commission, nor did the watchdog launch its own investigation.
Barring a last-minute intervention from Brussels, Kovachki looked certain to be the new owner of the Bobov Dol power plant after the June 26 auction.
A local businessman with interests in various industrial segments, Kovachki owns not only Energia MK and Minna Kompaniya, the latter being involved in coal extraction, but also the significant electricity and briquette producer Brikel EAD.
Brikel was established in 2000 and comprises Briketna Fabrika EAD (briquette factory) and Maritsa-Iztok 1 thermal power plant.
Maritsa-Iztok 1 was taken out of the National Electricity Company (NEK) with the beginning of the energy sector reforms. The plant started its first operations in the late 1960s. In 2000, Brikel EAD, already owned by Kovachki, started selling electricity to NEK.
According to the company, its briquette production factory is the only one of its kind in Bulgaria. It sells briquettes in bulk for 127 leva and packed briquettes for 150 leva. Brikel EAD uses lignite coal for the production of the briquettes. The factory has been operating since 1961.
Kovachki’s interests are not restricted to local coal extraction and other investments. Besides owning the Evropa supermarket chain in Sofia, he also invests in and extracts coal in neighbouring Serbia. Kovachki’s investment in Serbia consists of the privatisation and purchase of 15 Serbian companies operating as a holding, including five diverse enterprises, producing tyres and rubber products as well as military apparatus and explosives. Another Serbian company in this group is Nevena, a cosmetics producer, privatised in 2007.
Kovachki also owns Kovin coalmine in Serbia. His company, Kornikom, bought the mine in 2007 for 16.1 million euro.
Consequently, Kovachki is not the favourite of the Bulgarian environmental movement, which included his name in a blacklist of companies, organisations and people allegedly destroying Bulgarian nature. According to them, he is also “the presumed illegal builder on the territory of Mussala peak (the highest in the country, located in Rila National Park). Kovachki plans to “overbuild” in the area of Iskrovete and resell it as apartments, which will destroy Malyovitsa peak. His companies are LM Impex and Nadar 2006, the environmentalists said.
But Kovachki’s biggest interest is in coal-generated power plants and he believes that this and nuclear energy form the future of the planet. He expressed his views during the All for Green debate on June 24 in the Red House for Culture and Debate in Sofia.
Kovachki said that for Bulgaria to continue to be independent, it needed to use its remaining fossil fuels because the price of all other fuels was increasing. Bulgaria has enough coal for another 150 years, he said.
Asked when he would start installing the necessary environmental protection equipment at the thermal power plants he owned, Kovachki said that he will respect European Union requirements and will install the equipment by 2015, but not earlier.
According to Kovachki, the EU was heading in the wrong direction by accepting that the world would produce energy from renewable energy sources. “If we think that we will become a competitive country by developing this kind of energy, it’s a fiction,” he said. According to him, nuclear energy did not pollute the environment.
