In recent years, Bulgaria has increasingly prioritized the development of energy storage infrastructure as part of its broader transition to a more sustainable and resilient energy system. With growing renewable energy capacity, particularly from solar and wind sources, the need for efficient storage solutions has become critical to balancing supply and demand.
Government initiatives, European Union funding, and private sector investments have driven advancements in battery storage, pumped hydro, and other innovative technologies. These efforts aim to enhance grid stability, reduce reliance on fossil fuels, and support Bulgaria’s long-term energy security and decarbonization goals.
One of the key projects, launched by the Bulgarian Ministry of Energy in March 2024 under the National Recovery and Resilience Plan, aims to support the development of renewable energy generation co-located with electricity storage facilities. The Ministry issued a tender to provide investment aid for developing the storage component of the combined project.
The tender was split into two streams of applications so that both small and large-scale projects may benefit from the funding. The tender for smaller projects was applicable for storage facilities with installed power between 200 kilowatts and 2 megawatts and aimed to support at least 200 megawatts of renewable energy capacity alongside 100 megawatts of energy storage. The other tender was directed at larger projects exceeding 200 kilowatts, with targets to support at least 940 megawatts of new renewable energy capacity along with 200 megawatts of energy storage. The total budget of the tenders was approximately EUR 270 million and grants could cover up to 50% of the eligible costs.
The results from the two tenders look promising. Under the tender for smaller projects, 200 proposals were selected for funding with a total value of approximately EUR 54 million. The projects should bring 435 megawatts of renewable energy capacity and 176 megawatts (352 megawatt-hours) of storage capacity to the grid. As for large-scale projects, 49 proposals were selected for funding with a total value of approximately EUR 214 million. The projects should bring 2.66 gigawatts of renewable energy capacity and 1 gigawatt (2 gigawatt-hours) of storage capacity to the electricity system. Currently, funding contracts are being executed under which investors will be obliged to commission their projects by the end of March 2026.
In August 2024, the Ministry of Energy issued a new tender, funded under the EU’s Recovery and Resilience Facility, exclusively focused on standalone electricity storage facilities. The tender aims to support the construction of at least 3 gigawatt-hours of storage capacity. It represents a crucial step in modernizing Bulgaria’s energy infrastructure and improving grid stability.
The total grant funding available for this procedure amounts to EUR 590 million. To qualify, projects must have a minimum capacity of 10 megawatts (AC) and be able to store energy for at least two hours. Each applicant can receive up to EUR 76 million, covering a maximum of 50% of the eligible costs under the procedure. Interest in this tender was significant, with over 150 applications submitted. The proposals are currently under evaluation and the awarded projects will be announced shortly.
The rise in storage infrastructure projects is driven not only by available grant funding programs but also by legislative changes in the past two years that have enabled the development of electricity storage facilities. The connection of standalone facilities to the electricity grid is subject to a grid bond of BGN 50,000 per megawatt of connected capacity.
Aside from new projects for the development of storage infrastructure, the Bulgarian government has also invested in repairing key state-owned storage infrastructure – notably the Chaira hydropower plant. The rehabilitation project is being carried out under a tender procedure launched by the National Electric Company, through which several private companies were awarded contracts to restore the plant’s operational capacity. In addition, Bulgartransgaz, the state-owned transmission system operator of natural gas networks in Bulgaria, has recently issued a new tender related to the expansion of the Chiren natural gas storage facility. The subject of the new tender is the engineering, supply of materials, and performance of three exploitation wells. The estimated value of the public procurement is EUR 56 million and at the time of writing, proposals are expected by February 25, 2024.
By Dimitar Kairakov, Head of PPP/Infrastructure, Schoenherr
This article was originally published in Issue 12.2 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.
