On Thursday, 30 August, the Saeima adopted amendments to several laws, stipulating support measures to entrepreneurs in order to reduce the negative impact of the rising energy prices on the Latvian economy.

Amendments to the Law on Measures to Reduce the Extraordinary Rise in Energy Prices stipulate the electricity system service fee decrease in full to those electricity end-users who are legal entities and to whom the household energy system tariff does not apply.

According to the summary of the Draft Law, the system services fee constitutes about 10% of the total energy costs to legal entities. It is the sum of fixed fees (connection service fee, input protection appliance current value fee, permitted load fee, or transmission capacity maintenance fee) and variable fees (electricity supply fee or electricity transmission fee). The forgone income of the distribution and transmission system operators will be compensated from the State budget.

The Law stipulates support measures from 1 October 2022 to 30 April 2023. The support will be not be provided to State and municipal institutions, as well as to legal entities under sanctions.

The Law additionally stipulates a full decrease of the mandatory procurement and capacity component to end-users from 1 September to 31 December 2022.

The Cabinet of Ministers has been given a one-month deadline to develop support measures to reduce the extraordinary rise in energy prices to households that use propane gas for heating. The support measures stipulate state assistance during the period between 1 May 2022 and 30 April 2023.

The amendments to the Law on Measures to Reduce the Extraordinary Rise in Energy Prices will enter into force on the day following their promulgation.

Amendments to the Law on Assistance for Mitigating the Economic Consequences Caused by the Sanctions and Countermeasures Imposed due to the Military Aggression of Russia against Ukraine stipulate a new support measure in the form of a grant to ensure uninterrupted operation of energy intensive companies working in the processing industry in order to promote market stability in relation to the increase in energy prices and to maintain the competitiveness of Latvian companies in the current geopolitical situation. The authors of the Draft Law note that the support will be extended to companies whose energy costs make up at least 10% of total costs and that consume over 500 megawatt hours of electricity per year.

Saeima Press Service