The European Commission (EC) may stop a major project for building a sewerage system in Sofia, financed with funds from the EU's pre-accession structural aid programme ISPA unless the State Commission for Energy and Water Regulation (SCEWR) states its position on the proposed plan and charges of Sofiiska Voda by May 1.

Carsten Rasmussen, from the EC's Regional Policy Directorate General, revealed the possible move at a news conference on February 27, Bulgarian news agency (BTA) reported.

The money under ISPA, a total of 58 million euro, was provided by the European Commission for investment by water concessionaire Sofiiska Voda, whose majority shareholder United Utilities, has so far invested little money due to low water prices and sewerage services and because the SCEWR is yet to approve its investment plan. In order for the EC to authorise the investments, the price paid by consumers for one cu m should increase to 1.20 leva from the current 0.85 leva, Rasmussen said.

A second supplementary agreement to the concession contract with Sofiiska Voda would secure 100 million euro in investments. The Environment and Water Ministry, the Finance Ministry and the SCEWR have been notified that unless a new agreement and pricing schedules were announced by May 1 for this year and the next, those funds would also be lost.

If Sofia does not implement this project, it would be punished twice: first, by not receiving the 58 million euro under ISPA, and second, for failing to meet the requirements for drinking water quality, which should be achieved by 2010, said Renaldo Mändmets, also of the European Commission's Regional Policy Directorate General.

The EC officials visited two of the sites listed as possible locations for refuse processing in the Sofia Municipality's waste management strategy. According to Rasmussen, the sites are appropriate for building installations for treating solid household waste. There are two options for solid waste treatment, deemed appropriate for Sofia. One involves processing the waste to produce alternative fuel for cement mills and thermal power plants. The other option is thermal treatment, which is also used in other EU countries and meets all relevant standards.

Sofia mayor Boiko Borissov blamed SCEWR for the delay that could cost the city millions in lost aid. "I hope that the non-populist parties will support the second annex to the concession contract with Sofiiska Voda," he said.

Deputy mayor Maria Boyadjiiska said that 99 land expropriation procedures needed to be carried out in connection with the sewerage project under ISPA, but that would not be a problem that would prevent the building of the system.