The Ministry of Economy is the Managing Authority of the Energy Efficiency and Green Economy grant procedure under the Operational Programme Development of the Competitiveness of the Bulgarian Economy.

Spearheading the procedure’s activities, the Ministry of Economy assumes responsibility for criteria setting, approval or rejection of project proposals, monitoring and overall management of project implementation, as well as verification and final endorsement of expenses. Due to the broad scope of these tasks, the Ministry assigned the monitoring and verification of investment projects of small and medium sized enterprises (SMEs) to KPMG in Bulgaria and ESD Bulgaria following a public procurement tender.

The challenge

The verification of investment projects and the respective on-site visits require not only in-depth knowledge of EU funds rules but also extensive awareness and understanding of the specifics of each business, as well as the technical aspects of the energy efficiency investments.

KPMG’s approach

As the Verification Assistant, KPMG delivered relevant services to the Ministry of Economy depending on the stage of the monitoring and verification procedure. In the early stages, our contributions were primarily related to the update of the list of eligible materials and equipment. During the period July 2013 – October 2015, we performed on-site visits and completed the verification process for the investment projects.

In our support to the Managing Authority, we also provided advisory opinion letters, monitored project implementation activities, and prepared ad-hoc reports on identified malpractices as needed. For the successful completion of such a complex verification process, we established regular and effective communication with the Ministry to ensure that any ongoing issues were resolved in an adequate and timely manner.

For instance, after several on-site visits in the summer of 2014, we determined that a set of regulations was limiting the changes that could be made to technical specifications of equipment, thus unnecessarily penalizing beneficiaries for improvements made to the characteristics of the sponsored equipment. Following a discussion with the Managing Authority, we were able to achieve an amendment to the applicable rules that allowed for changes to the technical specification as long as those changes improved the energy efficiency indicators. Moreover, the amendment decision was also applied
retroactively, which further contributed to the better utilization of funds and
increased competitiveness of Bulgarian SMEs.

The result

Over the course of three years, we verified the investments in energy efficiency of 434 projects. Through our advisory work, we provided continuous support to the Managing Authority and contributed to a more favorable and competitive business environment for Bulgarian companies.