Bulgaria: Accelerating the energy transition through renewables, storage and next-generation nuclear

Bulgaria is positioning itself as a strategic hub for renewable energy investments in South-Eastern Europe, accelerating its energy transition through targeted regulatory reforms, substantial investments in energy storage systems (BESS), and the development of new nuclear capacity.

With record-breaking auctions, ambitious 2030 climate targets and a growing M&A market, the country is reshaping its energy mix with a strong focus on sustainability and security of supply.

The new renewable energy cycle: from feed-in tariffs to the merchant market

The development of renewable energy projects in Bulgaria has gained renewed momentum in recent years, marking a structural shift compared to the previous boom of 2010.

Unlike that earlier phase, which was driven by guaranteed feed-in tariffs, current renewable projects are developed on a merchant basis, without subsidy mechanisms, and rely entirely on market revenues. This evolution reflects the maturity of the sector and the economic competitiveness of clean technologies.

Photovoltaic installations continue to dominate the Bulgarian energy landscape, with approximately 5,000 MW of operational capacity, consolidating solar power as a cornerstone of national renewable generation.

Wind projects, while attracting growing investor interest, still face complex environmental impact assessment (EIA) procedures and longer permitting timelines.

2025 regulatory reforms: administrative simplification and fast-track procedures for renewables

In 2025, Bulgaria's regulatory framework for renewable energy underwent substantial changes aimed at facilitating and accelerating the development of new projects. A fast-track procedure was introduced, providing for the issuance of all administrative permits required for the construction and commissioning of wind farms in priority areas, as well as the related grid connection infrastructure, within a maximum timeframe of 12 months.

Moreover, in administrative and judicial proceedings concerning appeals against investment projects – including those related to environmental protection and biodiversity – the shortest statutory deadlines must be applied. The practical effectiveness of these amendments will become evident in the coming months, when the first projects benefit from the new streamlined procedures.

These 2025 amendments to the Renewable Energy Act form part of a broader legislative reform process, which has included the establishment of dedicated administrative support units within municipalities to assist investors throughout the permitting process, as well as updates to the rules governing connection to the national electricity grid.

One of the most significant innovations is the introduction of a financial guarantee (in the form of a cash deposit or bank guarantee) in the grid connection application procedure, amounting to approximately EUR 25,565 per MW of requested capacity. This measure is intended to prevent speculative practices involving the reservation of grid capacity without a genuine intention to develop projects.

Integrated National Energy and Climate Plan: 2030 targets and investment opportunities

According to the latest draft of Bulgaria's Integrated National Energy and Climate Plan (INECP), the country aims to achieve a 34.96 % share of renewable energy in gross final energy consumption by 2030.

In the electricity sector in particular, Bulgaria targets a 49.34 % share of renewables in gross final electricity consumption. Achieving these targets will require a significant expansion of renewable generation capacity, primarily through new large-scale wind and photovoltaic installations.

The combination of recent investor-friendly legislative activity and ambitious national targets is fuelling a dynamic and growing M&A market for renewable energy projects. Many projects reach the "ready-to-build" stage; however, in most cases, local developers lack the financial resources to complete construction independently.

This environment creates concrete opportunities for both foreign and domestic investors to acquire stakes in fully permitted projects. Transaction structures range from traditional share acquisitions to more complex joint ventures, involving strategic partnerships between local developers and international investors.

BESS (Battery Energy Storage Systems): Bulgaria emerges as an energy storage hub

Battery Energy Storage Systems (BESS) have emerged as one of the most dynamic segments of the Bulgarian energy market. In 2024, the Ministry of Energy launched two competitive tenders under the National Recovery and Resilience Plan (NRRP) to grant investment aid for renewable energy projects co-located with storage systems.

Public financial support is granted exclusively for the storage components of hybrid projects and is capped at 50 % of eligible costs, ensuring a strong leverage effect on private investment.

The procedure was divided into two separate tenders to ensure that funding reached both small-scale (distributed) projects and large utility-scale projects.

Auction 1 – Small and medium-scale projects:
A total of 327 project proposals were submitted, of which 267 were admitted to the ranking following technical and economic evaluation. Available funding amounted to EUR 55m, enabling the financing of 200 projects. These projects provide for the installation of a total of 435 MW of renewable capacity – primarily photovoltaic – and 176 MW of co-located storage systems. An additional 67 projects, for which the current budget is insufficient, were placed on a reserve list with a total value exceeding EUR 22m.

Auction 2 – Utility-scale projects:
Seventy proposals were submitted in the tender dedicated to large projects, of which 65 were admitted for evaluation. Available funding amounted to EUR 218m, allowing the financing of 49 projects. Their implementation will result in the installation of a total of 2,660 MW of renewable capacity and 1,000 MW of co-located storage systems. Awarded developers must complete commissioning by the end of March 2026 to comply with the tender requirements and NRRP milestones.

Standalone BESS: nearly 10 GWh of new storage capacity

The Ministry of Energy also launched two tenders specifically dedicated to investment aid for the development of standalone BESS (independent storage systems not connected to generation plants). Grant agreements under the first tender have already been signed: 82 standalone BESS projects were awarded, with a total value of approximately EUR 588m.

The expected total capacity of the new storage systems is 9,712.89 MWh (around 9.7 GWh) – a remarkable figure, given that in 2023 no utility-scale BESS were operational in Bulgaria. The deadline for submitting bids under the second tender expired on 19 November 2025, with a total budget of EUR 118m.

A favourable regulatory framework and market opportunities for BESS

Bulgaria's energy storage sector is undergoing a rapid and structural transformation. This development is driven not only by the availability of public subsidies, but also by streamlined permitting procedures and an investment-friendly regulatory framework. Authorisation procedures for BESS often take less than 12 months, allowing projects to move from initial concept to commercial operation in under two years – a significant competitive advantage compared to other European markets.

No specific licence is required for electricity storage activities and, crucially, there is no double charging for grid use during charging and discharging cycles.

Market rules allow BESS operators to actively participate in wholesale electricity markets (day-ahead and intraday) and to provide ancillary services to the transmission system operator (ESO), including balancing and frequency regulation services. The exponential growth of solar capacity in recent years has significantly reduced electricity prices during daylight hours, creating arbitrage opportunities and making BESS essential for the economic optimisation of the power system and the provision of balancing services.

New nuclear capacity at Kozloduy: 2,300 MW of low-carbon energy

The Kozloduy New Builds programme is a strategic state initiative aimed at adding two Westinghouse AP1000 pressurised water reactors at the existing Kozloduy site in northern Bulgaria. The project will deliver approximately 2,300 MW of new low-carbon generation capacity, with the primary objective of strengthening national energy security and reducing dependence on imports.

Key project stakeholders include the state-owned project company Kozloduy NPP – New Builds, Westinghouse Electric Company (supplier of the AP1000 reactor technology) and Hyundai Engineering & Construction (responsible for engineering and construction). According to official public statements, the estimated total cost of the project amounts to several billion euros.

The first new unit is expected to reach commercial operation between the early and mid-2030s, although exact timelines and final costs remain subject to the final investment decision (FID) and the conclusion of financing arrangements with international financial institutions and strategic partners.

A strategic destination for energy investments

Bulgaria is emerging as an attractive market for energy investments, combining effective regulatory reforms, substantial financial incentives and ambitious climate targets.

The country offers concrete opportunities across all segments of the energy transition: greenfield and ready-to-build renewable projects, utility-scale battery storage systems, and participation in strategic infrastructure projects such as next-generation nuclear power. For international investors and developers, the Bulgarian market represents a strategic entry point into Southeast Europe, with significant medium- to long-term growth prospects.

Dimitar Kairakov | Attorney at Law | Schoenherr Czech Republic
T: +359 2 93310 06 | E: d.kairakov@schoenherr.eu

Daniele Iàcona | Head of Italian Hub | Senior Attorney at Law
T: +40 733 730 119 | E: d.iacona@schoenherr.eu