Ministry of Economics reports that on the 20th of December the Cabinet of Ministers approved amendments to the Electricity Market Law. These amendments state: electricity users will no longer have to cover mandatory procurement costs.
This means electricity consumers’ bills will no longer contain any mention of Mandatory Procurement Component (OIK).
Amendments will need to be passed by the Saeima.
As previously reported, on the 30th of August Latvia’s Cabinet of Ministers reviewed the report on Complex measures to resolve the problem of mandatory procurement component and electricity market’s development and conceptually supported the proposal from the Ministry of Economics to set the OIK rate at 0 EUR/MWh between the 1st of September 2022 and the 31st of December 2025. The proposal also provides for covering the costs from the state budget. At the same time, the government ordered the Ministry of Economics develop amendments to the Electricity Market Law and propose a solution that would let allow Latvian electricity users not cover OIK costs after 2025.
‘OIK is no longer listed in bills of end users since September 2022. Soon it will be discontinued for good. Considering that the number of recipients of mandatory procured electricity is down significantly, we have improved the existing support system to ensure mandatory procurement support is covered by the state and no additional burden is put on consumers’ shoulders from now on. The OIK section in power bills will be left empty from now on,‘ said Minister of Economics Ilze Indriksone.
She also mentioned that the average wholesale price of electricity in Latvia will remain high in the coming months, adding that
provision of support has been extended by four months for protected users.
This year there was a considerable drop in the number of recipients of mandatory procurement state support. According to data from State Construction Control Office, the number of recipients of OIK support will continue going down in the near future.
Also read: Mandatory procurement component for electricity in Latvia to be zero next year