Bulgaria's parliament scrapped preferential prices for new renewable energy installations on Thursday as the country is struggling to cut deficits in the energy sector and keep a lid on consumers' utility bills.

Wind power farms and photovoltaic parks mushroomed in 2011, after Bulgaria introduced generous subsidies for renewable energy, guaranteed for 20 years and committed to buy all the energy produced by them.

But the incentives have weighed on the power costs in the European Union's poorest country, which has met its 2020 target for a 16% share of renewable energy at the end of 2013.