Bulgaria’s power sector is diverse and well developed, with universal access to the grid and numerous cross-border connections with neighboring countries. A key driver of the Bulgarian economy, the energy sector is strongly affected by geopolitical, economic, and regulatory pressures. The Bulgarian electricity market is in transition, and nuclear is expected to retain its large share of generation capacities. During this energy shift, the government plans to rely on nuclear power generation to meet a significant portion of electricity demand.  
Bulgaria’s electricity production decreased by 4.98% year-on-year, to some 37,963 GWh in 2024. Electricity consumption increased slightly by 0.97%.  

Traditionally a large regional exporter, Bulgaria’s net electricity exports in 2024 dropped to 1.02TWh, a 69.9 % decline compared to the previous year. Baseload power plants (coal, nuclear) generated a total of 28,46TWh of electricity in 2024, which is 10.7 % less than 2023. The share of electricity produced from RES, linked to the transmission network, increased by 32.21%, reaching 3,3264 GWh. 

Renewable electricity capacity (mostly solar PV) increased by 938 MW in Bulgaria in 2024, compared to the addition of over 1.2 GW in photovoltaics in 2023. At the start of 2025, projects for a total of 4.1 GW were lined up for grid connections. Around 500 MW of battery energy storage systems (BESS), with a storage capacity of some 1,300 MWh, were installed in the country by mid-2025, helping balance the country’s power grid. The projections are that in the next 12-18 months, Bulgaria will add 7,000-7,500 MW of battery storage, capable of meeting 10%-15% of daily demand.

To support its energy needs, Bulgaria imports natural gas, oil and oil products, and solid fuels (anthracite and black coal, coal coke). The main local energy source in Bulgaria is lignite coal. Another source is nuclear energy, which significantly contributes to Bulgaria’s electricity generation. In 2024, nuclear power accounted for approximately 41.6% of Bulgaria’s total electricity generation, according to the International Atomic Energy Agency (IAEA). The reduction of fossil fuel imports into Bulgaria means an increased need for energy production from renewable sources. 

ESO, the country’s transmission system operator, has invested more than EUR 25 million in digitalization of the grid. Grid modernization and flexibility measures are a major component of Bulgaria’s Recovery and Resilience Plan, which will fund the ESO to carry out necessary upgrades. Power interconnectivity in the region made another important step forward with the completion of the second cross-border transmission line between Greece and Bulgaria.

Bulgaria’s recovery and resilience plan (RRP) calls for deployment of a minimum of 1.4 GW of renewable energy with storage, including an investment in renewable and storage facilities that will be financed by EUR 342 million from the Recovery and Resilience Facility (RRF) and EUR 684 million from private funding.
The plan includes significant investments to accelerate decarbonization of the energy sector, tripling power generation from renewables by 2026, building large electricity storage capacity, and setting out a framework for a coal phase-out. However, in January 2023, the Bulgarian Parliament voted to scrap interim coal-reduction commitments from the RRP and keep its entire coal fleet online until 2038, despite the risk of losing almost EUR 1 billion for energy sector modernization. The RRF is being renegotiated with the European Commission to keep the coal industry on life support as long as possible. 

Due to delays in ongoing repair projects and regulatory inconsistencies, Bulgaria uses only one-third of its large, pumped-storage hydro power plants (HPPs) and even less of smaller run-of-the-river plants. In times of rising prices and shortages of electricity supply, HPPs can ease pressure on the system and offer cheaper electricity during periods of peak consumption. 

From September 2024 to August 2025, electricity consumption in Bulgaria relied primarily on low-carbon sources, with more than two-thirds, or 67.27%, of its electricity coming from clean energy sources. Within this category, nuclear energy plays a major role, contributing about 40.38% to the country’s electricity supply. Solar and wind energy make up a smaller portion, providing 16.52% and 3.44%, respectively. Hydropower adds another 6.47% of electricity generation. Fossil fuels account for about 32.73% of the energy mix, with coal being dominant at 27.6% and natural gas providing a minimal 5.13%.  

Bulgaria’s electricity production from coal has significantly decreased, driven by rising costs for greenhouse gas emission certificates and a broader energy transition towards renewable sources. While Bulgaria continued to use some lignite coal, particularly at the state-owned Maritsa East 2 plant, its financial performance faltered, and the overall share of coal in the energy mix declined substantially. The country has produced record amounts of solar electricity but is losing market share and is increasingly less competitive due to sluggish reforms in the sector.

Bulgaria’s energy market is dominated by state-owned entities, which include:   
•    Bulgarian Energy Holding (BEH), which manages the most important companies in the energy sector
•    Kozloduy Nuclear Power Plant (KNPP) with two operating units 
•    National Electric Company (NEK)
•    Maritza East 2 Thermal Power Plant (TPP), part of the Maritza East Complex. Contour Global owns 73% of Maritza East 3 TPP, with the NEK holding the remaining 27%.
•    31 hydropower plants and pumped-storage hydropower plants owned by NEK, with total installed capacities of 2737 MW
•    Electricity System Operator (ESO).
•    Bulgargaz; and
•    Bulgartransgaz

Bulgaria’s energy generation includes nuclear energy, solid fuels, such as lignite, as well as small quantities of gas. The role of renewable energy sources, especially solar, increased dramatically in recent years. The Bulgarian government has identified three additional major hydropower projects as a priority, along with nuclear new build at KNPP. 

The regulated Bulgarian electricity market is dominated by a few major players that have built a supply monopoly. There is no real competition in the distribution market that could enable consumers to choose their supplier, as there is only one licensed supplier in each geographical region. Bulgaria’s energy intensity is among the highest in the EU. 

Bulgaria’s first nuclear power plant was launched in Kozloduy (KNPP) in 1974. Over the years, six units were completed, making KNPP one of the largest nuclear power plants in the region, with 3,000MW installed capacity. In the 1980s, a new nuclear plant at Belene was approved for construction.  Meanwhile, two of KNPP’s units were closed in the early 2000s as a prerequisite for EU accession; two other KNPP units were closed as part of the 2007 agreement of Bulgaria’s accession into the EU.  Over the years, there have been many discussions by the government and energy companies about a new KNPP unit (Unit 7), as well as debates about completing the controversial, and incomplete Belene project with two Russian reactor vessels, two pressure compensators and 24 hydraulic accumulators, which remain in storage. 

Thermal power plants were encouraged in Bulgaria in the early 2000s as four Kozloduy NPP units were being closed. Today, there is a thermal power plant complex (TPP), known as the Maritza East Mining Complex, which consists of three lignite-fired thermal power plants (TPPs) known as: Maritza East 1 (ME-1), a 686-MW U.S.-built plant, owned and operated by AES Corporation; Maritza East 2 (ME-2), a 1,610-MW state-owned plant; and Maritza East (ME-3), a 908-MW plant owned by the U.S. company Contour Global. 

As of March 2025, Maritza East 3 was set to stop generating power and Countour Global. However, the Bulgarian government reversed this decision, and Bulgaria is urging Contour Global to find investors to acquire the power plant and continue to operate it. There are several other TPPs in the country, the largest among these being the 1,260-MW Varna TPP.  

Bulgaria’s electricity production 

Electricity production in Bulgaria reached 3,821 GWh in Dec 2024, compared with 3,008 GWh in the previous month. Generation reached a record low of 2,463 GWh in June 2024.
View Bulgaria’s Electricity Production from Jan 2024 to Dec 2024 in the chart:

Bulgaria’s energy sector priorities are:
1.    Decarbonization
2.    Facilitating deployment of renewables and alternative energy sources (green hydrogen and biogas)
3.    Setting ambitious targets to expand storage capacity for solar and geothermal electricity
4.    Liberalizing the wholesale and retail electricity markets; and
5.    Renovation of the building stock
Bulgaria has used profits from its mainly state-owned energy producers to shield businesses from surging power costs.

Sub-sector Best Prospects  

Natural Gas

Bulgaria’s domestic market for natural gas is more than 3 billion cubic meters (bcm) per year, a third of which is from Azerbaijan, and transits five times as much Russian gas to its neighbors, mostly Hungary, Greece, North Macedonia, and Serbia.  Domestically, industry uses almost two-thirds of the imported natural gas, and the remaining one-third is used for centralized residential heating. Bulgaria imported nearly all its gas from Gazprom until 2022, when Bulgaria’s refusal to pay in rubles resulted in Gazprom halting gas flows.  Bulgaria no longer directly imports gas from Russia, but imported gas from Turkiye is likely a Russian-Turkish blend and swaps with Greece are commonplace. 

Bulgaria is a regional gas transit hub that moves 16 bcma of Russian gas to its neighbors. Bulgaria aspires to transit additional gas from Greece and Turkiye to Ukraine via the Vertical Gas Corridor. Construction on Bulgaria’s part of the Vertical Gas Corridor project, a multi-country initiative, has begun, and the project is expected to conclude in 2026.  The Bulgarian government is exploring long-term LNG contracts with U.S. suppliers that would make use of the floating storage and regasification unit (FSRU) in Alexandroupolis in which it is a 20-percent owner. The Alexandroupolis gas terminal provides a critical entry point for Bulgaria and other landlocked Eastern European countries to help diversify their energy supplies away from Russian gas. With renewed operations in August 2025, the Alexandroupolis floating LNG terminal allows Bulgaria to import LNG and serves as the start of the Vertical Gas Corridor, a regional gas supply network that connects through the Interconnector Greece-Bulgaria (IGB) pipeline.

The Vertical Gas Corridor is a strategic energy infrastructure initiative designed to enhance energy security and diversify natural gas supply routes in Central and Southeastern Europe. The project, which aims to reduce dependence on Russian supplies, involves Transmission System Operators (TSOs) from Greece, Bulgaria, Romania, Hungary, Slovakia, Moldova, and Ukraine. Using existing infrastructure from Greece to Ukraine, the Vertical Gas Corridor will allow LNG imported through Greece to fill the vast storage tanks in Ukraine, providing a new source of gas for Central Europe and the Western Balkans, and helping to reduce price volatility along the way. 

Expansion of the Chiren underground gas storage facility is of strategic importance for improving energy security, increasing competition and liquidity in the natural gas market in Bulgaria and the region. The first stage of the project to expand the Chiren facility was completed in September 2025. When completed, the expansion is expected to increase the storage capacity from 550 million cubic meters to 1 billion cubic meters of gas. It will be carried out in three stages – one above ground and two underground, with the above-ground stage involving the installation of new gas compressors to increase the ability for pumping gas and increase capacity by about 20%. This part has already been completed, the compressors are in operation, and during the current autumn-winter period, market participants, including Bulgargaz, can count on a volume of 650 million cubic meters of storage capacity.

Plan s call for the gas storage facility to be filled during the summer, when prices are lower, then supply domestic and non-domestic consumers at a more affordable price during the winter, while at the same time providing greater energy security for the country. 

Potential gas project opportunities (for suppliers, principal contractors, etc.) include:  
•    LNG technologies and liquefaction know-how provides opportunities for further diversification of natural gas supplies in Bulgaria.   
•    Supply of drilling equipment, seismic technology, offshore production platforms, and other upstream equipment and services. 

The Serbo-Bulgarian gas link, formally known as the Interconnector Bulgaria-Serbia (IBS), represents a critical infrastructural and geopolitical development in the energy sector of Southeast Europe. Completed in 2023, the 62-km pipeline runs from the Bulgaria to Serbia. It not only offers Serbia an alternative to Russian gas but also facilitates access to LNG from the Greek port of Alexandroupolis and Azerbaijani gas, marking a significant step in the diversification of energy sources in the region. 

The gas interconnector between Bulgaria and Romania is a key piece of energy infrastructure that crosses the Danube River, allowing for the bidirectional flow of natural gas between the two countries. 
Shell Exploration and Production, a subsidiary of Shell plc, was chosen as the top bidder for the exploration of oil and natural gas in the western Black Sea off the coast of Bulgaria. The exploration area spans more than 4,000 sq. km. Shell signed a contract with the Bulgarian government giving the oil giant rights to explore for oil and gas in the Block 1-26 Khan Tervel field in the Black Sea. Shell plans complex geological and geophysical works, including conducting new 3D seismic surveys, processing and interpretation of seismic data, and assessing potential of the area and others. Shell will also provide financial resources for educational programs to provide further training to Bulgarian specialists in the field of oil and gas exploration and production.
•    OMV Petrom, a Romanian oil and gas company, and NewMed Energy Balkan, a subsidiary of Israel-based NewMed Energy, signed in June 2025 a rig contract for drilling two offshore exploration wells on the Han Asparuh block in the Black Sea, offshore Bulgaria. Drilling operations will be carried out by Noble Corporation, which specializes in offshore drilling services. The selected drilling ship, Globetrotter I, is a state-of-the-art ultra-deepwater drillship. The integrated drilling services will be provided by Halliburton, and the well testing services will be provided by SLB. Total drilling budget is expected at approximately EUR170 million.

Coal

While the percentage of electricity generated by coal has dropped from 35 percent in 2020 to 27 percent in 2025, the coal regions and their transition to other industries remain politically sensitive.  Bulgaria’s large domestic coal reserves have historically powered the country, but EU-driven emission taxes and Bulgarian government subsidies to blunt their impact have complicated the industry outlook.  Bulgaria, as part of the EU, is working toward lowering emissions from coal power plants and reorienting its investments in energy generation and labor force towards nuclear and renewables. The Martiza East complex, a state-owned enterprise in the Stara Zagora area, generates around 40 percent of all coal-powered electricity. 

The University of North Dakota (UND) signed in September 2025 a Memorandum of Understanding with the Bulgarian Energy Holding (BEH) to establish a collaborative research initiative focused on the exploration and sustainable development of rare earth elements in Bulgaria. Initial analyses suggest that the composition of lignite in Bulgaria’s Maritza Basin is analogous in key respects to coal mined in North Dakota, offering a strong technical foundation for collaboration. The new agreement will enable BEH and UND to pool resources, expertise and technologies to conduct mineralogical characterization, advanced laboratory testing and technological validation and explore the potential of processing lignite from the Maritza Basin in Bulgaria for extraction of rare earth elements with high added value.

Oil 

Bulgaria’s refined oil products sector is dominated by one refinery owned and operated by Russian firm Lukoil.  Seventy percent of oil in Bulgaria is used by the transportation sector, including aviation fuel, while industry uses nine percent. The refinery provides over 75% of fuel for the local market. Diversifying crude oil supplies away from Russia is only the starting point in a long uphill battle for Bulgaria and its government toward energy security and independence. 

Lukoil’s refinery near Burgas - the largest in the Balkans - is a critical but controversial operation.  From 2022 to early 2024, the refinery primarily imported Russian crude, making use of an exception to the EU’s prohibition on Russian crude.  This derogation expired in early 2024, and the refinery has reportedly been importing crude from Kazakhstan, Iraq, and Tunisia since then. Under a compensation program for high electricity prices, Lukoil was granted EUR11.6 million from the Bulgarian state budget in 2024. The Russian-owned oil refinery Lukoil Neftochim reported a loss of USD125.6 million (EUR107 million) for 2024, meaning the company received more from the Bulgarian government than it paid in taxes.

There are three refineries in Bulgaria:  
•    INSA’s facility Belozem, Central Southern Bulgaria.
•    Bulgarian Petroleum Refinery in Dolni Dabnik Central Northern Bulgaria; and
•    Lukoil Neftochim Refinery in Burgas port, the largest refinery in the Balkans and owned by the second-largest oil company in the Russian Federation.

Smart Grids 

The European Bank for Reconstruction and Development (EBRD) is investing $56.2 million (EUR50 million) in Bulgarian grid modernization, including smart meter installations, underground line upgrades, and renewable assets. The funds will be used to modernize the electricity grid at Electrodistribution Grid West (EDG West).
Specifically, the modernization program includes smart meter installations, underground electricity line upgrades, and new or retroactive grid connection financing for renewable assets, which are expected to contribute to climate change mitigation efforts and result in up to 194GWh of energy savings annually.
At the end of 2024, the European Commission approved a EUR 590 million allocation to support investments in energy storage facilities in Bulgaria. The scheme will be fully funded through the Recovery and Resilience Plan, following the plan’s approval by the European Commission and its adoption by the Council of the European Union.

The objective is to add at least three gigawatt-hours of new energy storage capacity to Bulgaria’s electricity grid. This will facilitate the integration of additional renewable energy sources into the energy mix. The support will be in the form of non-repayable aid and will be accessible to all storage technologies. The funds should be available by December 31, 2025.

The European Commission granted $230.14 million (EUR 196) million to Bulgaria for implementation of four plans to modernize its electricity network. The projects are related to developing a smart energy infrastructure through distribution of so-called “smart meters” among customers, supporting the investments that energy associations would have to make to modernize the distribution networks so that data from smart meters can be used. The deadline for the full implementation of smart meters is 2027. By 2024, over 1.5 million smart meters had been installed across the country by ADD Bulgaria and ZTE, which worked with utility companies to reduce electricity theft and improve efficiency. 

Deployed smart meters in Bulgaria (in percentage to the number of end-customers in the region) are as follows:
•    Electrohold – 15%
•    EVN – 66%
•    Energo-pro – 10%

Nuclear Energy  

Bulgaria has a longstanding positive experience in nuclear energy, recognizing the benefits it brings to people and the environment. Bulgaria currently has two nuclear reactors, generating more than one-third of its electricity. 

In 2024, the United States and Bulgaria signed an intergovernmental agreement (IGA) for civil nuclear cooperation that underpins a range of bilateral collaboration across the Departments of State, Energy and Commerce and the U.S. Nuclear Regulatory Commission. Bulgaria began diversifying its source of nuclear fuel away from Russia and towards the United States, switching to a $100 million Westinghouse Electric Company fuel contract for its Unit 5 reactor. Bulgaria also chose Westinghouse AP1000 technology for two new reactors (Units 7 & 8) at the Kozloduy Nuclear Power Plant, a project that will present many additional opportunities for U.S. businesses. Bulgaria aims to reach a final investment decision (FID) on the construction of Westinghouse-designed AP1000 nuclear reactors Units 7 & 8 at the Kozloduy Nuclear Power Plant by early 2026.  

Bulgaria’s only nuclear power plant, the state-owned Kozloduy Nuclear Power Plant (NPP) has six units. Following the shutdown of units 1 and 2 in 2002 and units 3 and 4 in 2006, all the country’s nuclear power is generated through units 5 and 6. Bulgaria had planned to build a second nuclear reactor at Belene but subsequently opted not to do so.  In December 2016, following international arbitration, Bulgaria paid EUR 600 million (USD 642 million) in compensation to Russia’s Atomstroyexport for the equipment already manufactured by the company for the new nuclear capacity project. The equipment is now stored at the site designed for the construction of the power plant.   

At the end of 2022, Kozloduy signed a deal with Westinghouse Electric to supply it with nuclear fuel for its 1,000 MW Russian-built Unit 5, a first step to diversify away from Russian supplies.  KNPP loaded the new fuel in mid-2024. In May 2025, another 42 Robust Westinghouse Fuel Assembly (RWFA) fuel assemblies were loaded into the reactor for a second fuel cycle run. According to the Bulgarian Nuclear Regulatory Agency (BNRA), the WEC fuel assemblies have operated safely in the Russia-designed VVER-1000 reactor core.

Bulgaria signed memorandums of understanding (MoU) with U.S.-based NuScale Power, X-Energy, Fluor Corporation and Holtec International for deployment of U.S.-designed small modular reactor (SMR) technology. Such steps provide a clear indication that the government, despite plans to shift toward renewable power, is still keen on developing nuclear power.  

Project opportunities exist in the following areas:  
•    Equipment of turbine hall for new nuclear capacity, including switchgears, transformers, and power evacuation,  
•    Maintenance and upgrade of steam turbines at Kozloduy NPP (see www.kznpp.org)
•    Activities related to the decommissioning of four NPP reactors
•    Small /Advance Modular Reactors 
•    Removing and packaging historical nuclear waste
•    Nuclear safety and radiation protection  
•    Technical support for the regulatory body and  
•    Working with Bulgaria’s universities on training and educating nuclear engineers   

Renewables

Moscow’s decision to halt gas exports to Bulgaria following its invasion of Ukraine created an opportunity for Bulgaria to expand renewable energies and invest in energy-efficiency solutions.  

The EU’s incentive structure for renewables has driven the share of electricity generated from renewables in Bulgaria to 27 percent in 2025, a number that has been stunted due to limited grid capacity for renewables. Of that renewable energy, 53 percent comes from solar, 30 percent from hydropower, 15 percent from wind, and two percent from biomass. 

Bulgaria will soon exceed its 3,200 MW renewable energy target for 2030, with over 3,000 MW of total installed capacity, predominantly from photovoltaic (PV) solar power. This significant increase in PV capacity has occurred rapidly, growing from just over 1 GW in 2020 to triple that amount in about three years.

In 2023, the TSO confirmed applications for RES projects totaling 40,000 MW. In 2024, that number was reduced to 35,000 MW.

While solar dominates Bulgaria’s renewables market, wind presents market potential for U.S. businesses. The AES Corporation already operates 52 wind turbines. U.S. companies struggle to tap into the market due to local opposition to wind projects and cheaper Chinese competitors. 

The National Electric Company (NEK) operates 31 hydropower plants, with a total capacity of 2.74 GW. However, only one of the four units in the Chaira pumped storage hydropower plant (864 MW) was repaired since it shut down in 2022.

The second-largest hydropower plant is Belmeken, at 375 MW in generation mode and a pumping system of 104 MW; 14 facilities are under 10 MW. Four large hydro power cascades are crucial for NEK’s position as the largest producer of green electricity in Bulgaria: 
•    Belmeken - Sestrimo - Chaira Hydro Power Complex 
•    Batak Cascade 
•    Dospat-Vacha Cascade 
•    Arda Cascade

Energy Efficiency  

Bulgaria remains the most energy-intensive economy in the EU by a wide margin. Bulgaria’s economy consumes 3.5 times more energy resources per unit of its GDP than the EU average. That may not sound alarming, but Bulgaria is highly dependent on coal and nuclear power. The energy sector is the biggest greenhouse gas emissions polluter in the country, responsible for 70 percent of total greenhouse gases nationwide. Low wages and pension benefits also contribute to many people being unable to afford more sustainable means of heating during winter. The National Energy and Climate Plan stresses Bulgaria’s commitment to decarbonize its economy by 2050 in the context of the European Green Deal but also states the intention to keep Bulgaria’s reliance on domestic lignite sources to 2050 and beyond.  

The Cohesion Policy Funded plans to invest EUR 5.3 billion in the green transition in Bulgaria in 2021-2027. Investment in the energy efficiency of buildings is expected to benefit 3,800 homes and 180,000 square meters of public buildings. At the same time, finalization of Just Transition Fund (JTF) programming could help Bulgaria support sustainable energy solutions, training and education, and diversify the local economy in the affected coal regions. This will help alleviate the socioeconomic impacts of Bulgaria’s commitment to phase out the use of coal.

Bulgaria’s energy sector is still heavily reliant on coal, providing significant potential for energy savings and efficiency improvements. While electricity generated by coal has dropped from 35% in 2020 to 27% in 2025, the future of Bulgaria’s coal regions and their transition to other industries remain politically sensitive. Bulgaria’s large domestic coal reserves have historically powered the country, but EU-driven emission taxes and Bulgarian government subsidies to blunt their impact have complicated the industry outlook and shifted Bulgaria’s energy generation investments to nuclear and other energy sources. 

In 2020, Bulgaria requested a derogation from the EU for implementation of the National Energy Savings Plan, under the energy-efficiency obligation scheme. The reason was that this proposal was put in place about three years earlier than the relevant European directive. In Bulgaria, the energy efficiency obligation scheme is implemented through a combination of individual energy savings targets for energy traders and alternative measures. Bulgaria has experienced difficulties in implementing the energy-efficiency obligation plan.

Web Resources 

• https://www.spglobal.com/commodity-insights/en/news-research/latest-news/natural-gas/103124-eu-to-support-vertical-gas-corridor-with-us-lng-poised-to-boost-region-eu-official
• Bulgartransgaz: www.bulgartransgaz.bg
• National Electric Company https://nek.bg/index.php/en/
• Kozloduy NPP: www.kznpp.org
• Ministry of Energy: https://www.me.government.bg
• Energy and Water Regulatory Commission: www.dker.bg
• Energy Efficiency and Renewable Sources Fund: www.bgeef.com
• Bulgarian Wind Energy Association: http://bgwea.org
• Global Data: https://www.globaldata.com/ 
• Statista: https://www.statista.com/
• https://www.gem.wiki/Gas_Interconnector_Bulgaria-Romania
• https://lowcarbonpower.org/region/Bulgaria

U.S. Commercial Service Sofia Contact Information  
Name: Emily Taneva
Position: Commercial Specialist
Email: emily.taneva@trade.gov
Phone: +359-2-939-5770