Latvia

Overall assessment

Updated December 2022

The Latvian Parliament adopted on 14th July 2022 the general legislative framework for energy communities, which will come into force on the 1st of January 2023. However, the governmental (Cabinet of Ministers) Regulations have to be further adopted to fully transpose the EU provisions (deadline: 28th of February 2023).

Overall, the concept of energy communities is very new in Latvia and the national administration is still in the process of transposition. A complete enabling framework and special measures for RECs in the support scheme are not in place. However, it is positively evaluated that the national administration has published specific dates by when certain elements will be transposed.

Detailed assessment

Assessment of obstacles and potential for development of ECs

No formal assessment of potential and barriers has been carried out. The Energy Law that transposes energy community provisions, however, does reference other assessments carried out by some EU-funded projects including COME RES, the Co2munity Project, and a report by the CEE Bankwatch Network and REScoop.eu.

Removal of unjustified regulatory & administrative barriers

Not addressed in the transposition.

DSO duties around cooperation with ECs and facilitation of energy sharing

Technical regulations around energy sharing are currently being developed and should be ready around February, 2023.

Fair, proportionate, and transparent registration & licensing procedures

The Amendments on the Law on Energy require the fulfilment of these principles. However, no detailed criteria have been elaborated. These should be covered by the regulation of the Cabinet of Ministers to be adopted by 28 February 2023.

Incentives connected to network tariffs based on a CBA

Not yet undertaken. The issue of grid tariffs is envisaged to be dealt within the next approval (by the Public Utilities Commission) of the distribution grid tariffs methodology expected by 2023. The Amendments on the Electricity Market Law provide the principal option for differentiated tariffs. Namely, it has been stated that “the power distribution system services’ tariffs might differentiate between the levels of voltage, power capacity, electricity consumption, electricity delivered to the distribution grid or the profiles of electricity customers”. Thus, it opens potential space to elaborate differentiated tariffs for electricity sharing depending on used voltage and other parameters.

Non-discriminatory treatment as market participant

The Amendments on the Law on Energy explicitly include the principle of avoiding discriminatory treatment. They state that the members/shareholders of an energy community retain all the rights and obligations of the final energy customer (end-user) and active customer. The Cabinet of Ministers shall adopt the detailed regulation regarding the relationships between the REC and other energy users, with the energy suppliers (merchants) and also the DSO. The Amendments on the Electricity Market Law mention that state administration institutions, when planning the new policies and measures, ensure electricity energy communities’ equal right to apply for participation in state aid schemes along other market participants. These Amendments also state that electricity sharing does not affect the rights and obligations of the parties involved as final customers, producers, traders or aggregators.

Accessibility to low-income & vulnerable households

Not addressed in the transposition.

Tools to access finance

The Amendments on the Law on Energy provide that the Cabinet of Ministers should determine the rules for providing aid for commercial activities to be granted to energy communities, and that the Ministry of Economics elaborates the financial aid programs for RECs considering those rules. These supportive programmes have yet to be developed.

Latvia’s EU Cohesion Policy Programme for 2021-2027155 includes the measure No 2.1.4 to promote PV systems (including storage equipment for produced electricity). Beneficiaries of this programme are the commercial sector, municipal capital companies, cooperatives, energy communities and households. It is planned to establish a financial instrument, which will be administered by the state-owned development financing institution “ALTUM”.

Tools to access information

The Amendments to the Law on Energy state that the Ministry of Economics, in co-operation with the Ministry of Environmental Protection and Regional Development, shall elaborate and publish dedicated Guidelines for the Formation of Energy Communities, including recommendations for public persons (public authorities) regarding the provision of public support for energy communities and their participation in energy communities, by 30 June 2023.

Regulatory capacity building for public authorities

This is planned, as explained above.

NECP reporting on enabling frameworks

Not addressed in the transposition. Member States are required via the Governance Regulation (2018/1999) to report on their enabling frameworks for RECs by 15 March 2023.

Support Scheme adapted for RECs

Support schemes are currently being considered by the government, but nothing yet has been announced for the future.