AES and NEK reached an agreement for the amendment to the Galabovo PPA

April 8, 2015

The capacity price of AES Galabovo will be decreased by 14 percent and arrears of NEK will be paid in full.

AES 3С Maritza East I (AES Galabovo) reached an agreement with the National Electricity Company (NEK) for an amendment to the Power Purchase Agreement (PPA) that the plant has with NEK.  A Heads of Terms Agreement (HTA) was executed on Wednesday, April 8th with NEK.

The agreement between the parties states that AES Galabovo will decrease its capacity price by 14 percent. This will result in annual savings for NEK of about 50 million leva, and a cumulative savings of about 550 million leva over the remaining term of the PPA, which expires in 2026. In addition, NEK will pay all arrears to Maritza. A binding agreement is expected to be signed by the third quarter of 2015 and is subject to customary regulatory approvals and approval form the project lenders.

“With this agreement, AES is contributing to the restructuring of the energy sector in Bulgaria, and demonstrates its support to the government’s efforts to stabilize the sector through deep and broad reforms,” said the Executive Director of AES Bulgaria, Olivier Marquette. “The agreement, once implemented, is an important milestone for AES Galabovo, which represents the most modern thermal plant in the Bulgarian electricity system, supporting the energy security goals of the Bulgarian Government and actively contributing to the reliability and sustainability of the electricity network in Bulgaria. I also would like to recognize the negotiation team led by Minister Petkova, Deputy Minister Nikolov, BEH CEO Jacklen Cohen and NEK CEO Petar Iliev, which made possible the execution of this mutually beneficial agreement.”