The state and coal: an unhealthy marriage

An unhealthy marriage between the Bulgarian government and nineteen coal companies sees these companies receiving huge subsidies while trampling over employee rights.

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Nineteen polluting companies (recognised internationally as heavy polluters) active in coal mining, electricity and heat production, and linked to the energy tycoon Hristo Kovachki, are being propped up by the Bulgarian government.  Firstly they receive a subsidised price for ‘efficient energy’ because the electricity production accompanies industrial production of briquettes and heat energy. In reality these old coal burning power plants are not so efficient and by contrast clean solar plants and wind farms in Bulgaria receive 15 to 30 percent less for electricity production.

But this lightly covered up form of state aid is not the only benefit the “coal empire” receives from public funds. The energy system operator also pays the power plants for in case the system needs back-up – a so called “cold reserve” which is activated only when a deficit in the system emerges. All of thе plants included in the empire failed when it became necessary to activate the cold reserves during the bitterly cold January of 2017. In spite of that, the companies still received public money.

This murky network is highly indebted, with an accumulated loss of close to 200 million as well as delayed payments of taxes, salaries and social contributions nearing113 million. Repeated employee rights violations have emerged, accompanied by protests of humiliated workers who have had to wait for months to receive their earned wages of 300 or, in exceptional cases,400. What is more, the working conditions are extremely dangerous: between 2007 and the first half of 2017, the National Social Security Institute of Bulgaria registered 693 work-related injuries, with 23 dead and 17 permanently disabled in the coal extraction industry. In the near future, it is likely that mass dismissals of employees will lead to unemployment of entire municipalities, with rehabilitation of old mines doubtful. The vested interests in these businesses mean that the public is likely to lose out once again once the business structure’s demise emerges.

Aside from their employees, the coal empire is having a devastating impact on health and air pollution: the European Environment Agency listed some of these coal companies among the thirty biggest air polluters in the European Union in 2011, with aggregate annual damage costs of pollution between €664 million and over €2 billion.

Greenpeace CEE would like to see an end to subsidies for coal or fossil fuel power plants. Instead there should be incentives for small scale renewables for households and communities and democratization of Bulgaria’s energy system.

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Credits and acknowledgements

Graphic design: Mark Bitter, BITTER design, www.markbitter.de

Web design: Olov Källgarn, Pixelengine www.pixelengine.se

Financial support: This project has been realized by the helpful support of the KR Foundation and the European Commission LIFE program

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