On Thursday, after two unsuccessful attempts, the Saeima finally adopted amendments to the Law on Pollution in the second and final reading, aligning Latvia’s legislation with the European Union’s Emissions Trading System (ETS) and the new ETS2 scheme for buildings, transport, and additional sectors.
A total of 51 deputies voted in favor, while 42 opposed the bill.
For the past two weeks, the parliament had failed to vote due to a lack of quorum within the ruling coalition. In several attempts, only 48 deputies participated in the votes, forcing Speaker of the Saeima Daiga Mieriņa (Union of Greens and Farmers, ZZS) to adjourn the sittings. The bill had also been postponed multiple times earlier, with Kaspars Briškens (Progressives), chair of the Economic, Agricultural, Environmental and Regional Policy Committee, noting that technical corrections were still needed.
Before the vote, Minister for Climate and Energy Kaspars Melnis (ZZS) addressed the Saeima, emphasizing that the law does not impose new obligations, but instead allows access to additional EU funding for businesses investing in new technologies and supporting Latvia’s economic development.
Opposition MP Aleksandrs Kiršteins argued that before adopting the law, the government should clearly explain how it would lead to any “economic breakthrough.” Andris Kulbergs (United List) called on the Cabinet of Ministers to coordinate with Lithuania, Estonia, and Poland and ask Brussels to reconsider the region’s situation in light of security risks, suggesting that climate targets should be postponed, not cancelled.
Edgars Tavars (United List) echoed the sentiment, saying that
all available resources should currently be directed toward national security,
and the achievement of “green goals” should be frozen.
Minister Melnis later told LETA that as an EU member state, Latvia cannot refuse to transpose EU directives. Failure to adopt the amendments could result in fines of at least €300 million, as three infringement procedures have already been launched against Latvia.
He noted that penalties may already apply because the deadline for implementing the directive has been missed.
According to the Ministry of Climate and Energy (KEM), Latvia has not yet transposed the relevant EU legal norms, resulting in three ongoing infringement cases. The delay in transposing the revised ETS Directive — now over a year late — not only risks European Commission sanctions, but also creates administrative complications for ETS operators and obstructs system management.
The bill aims to update and streamline Latvia’s climate policy framework for ETS implementation, while reflecting institutional reorganizations and modernizing the law’s structure — which has been amended 21 times since 2001, making it difficult to navigate.
The amendments introduce a new chapter regulating the EU Emissions Trading System (ETS) and the new ETS2,
including conditions, requirements, permits, and obligations. Operators, aircraft operators, shipping companies, and fuel and energy suppliers will be required to take measures to reduce greenhouse gas (GHG) emissions and conduct emission monitoring.
The State Environmental Service (VVD) will determine which installations require a GHG permit and will have the authority to suspend operations for any operator acting without a valid permit.
ETS2 will cover fuel and heating consumption in buildings, transport, and other non-ETS industrial sectors. Starting in 2028, ETS2 allowances will apply to fuel and heating suppliers, who must surrender quotas based on the amount of fuel or heating delivered for consumption. Emissions will be calculated indirectly, based on fuel volumes.
Fuel and heating suppliers will thus become operators subject to VVD-issued GHG permits
and required to maintain individual monitoring plans. ETS2 monitoring and reporting rules will mirror those of ETS to ensure consistency between both systems.
Cabinet regulations will define the reporting, verification, and compensation mechanisms to prevent double-counting of fuel volumes under both ETS and ETS2.
The amendments also introduce a state fee for issuing and reviewing GHG permits, payable by ETS and ETS2 operators. In the current ETS phase (2021–2030), 52 installations (operated by 38 entities) in Latvia hold GHG permits.
To obtain a permit, operators must prove that their monitoring systems accurately determine annual emissions and comply with ETS or ETS2 reporting obligations. The state fee aims to ensure regulatory oversight and encourage proper compliance.
Detailed procedures and fee amounts will be set by the Cabinet of Ministers, and all fees will be administered by the VVD. In some cases, an installation may require multiple permits (e.g., A/B category and GHG permits), necessitating multiple fees for significant modifications.
For public transparency, the VVD will maintain free, publicly accessible electronic registers of GHG permits.
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