The Riga City Council has pledged to find solutions in cooperation with the Ministry of Economics (EM) to mitigate the rise in heating tariffs, but a complete avoidance of price increases appears unlikely, said Riga Mayor Viesturs Kleinbergs (P) after a meeting with the management of AS “Rīgas siltums.”
According to Kleinbergs, the problem does not lie with “Rīgas siltums” itself, but rather with the tariffs the company must pay to purchase heat from AS “Latvenergo.” He explained that “Rīgas siltums” is forced to buy heat from “Latvenergo” at higher prices, even though part of this heat is a by-product of electricity generation.
In discussions with the Ministry of Economics and the Public Utilities Commission (SPRK), the city wants to determine whether fair competition exists in a situation where “Latvenergo” is “in a sense earning twice by generating electricity – and both times partially at the expense of Riga residents.”
“Riga residents are in a sense hostages in this situation, because the Latvenergo tariff is higher than what we can currently produce ourselves or what smaller heat producers can offer,” said Kleinbergs.
He emphasised that
the city is ready to seek solutions so that residents are not overcharged for heating,
including the possibility of building a connection between both banks of the Daugava. Another potential solution is to buy out EM’s shares in the company, making Riga the controlling shareholder.
“Otherwise, we are hostages to a minority shareholder who sides either one way or another. Riga is ready to take over control of this company,” said Kleinbergs.
Commenting on potential funding sources, the mayor stressed that “the issue is not about money, but about priorities.” He believes that such an investment would help companies for whom heat is a vital input reduce costs and improve competitiveness.
At present, it remains unclear how much heating prices will rise for Riga residents in autumn.
“It’s clear that there will definitely be an increase,” Kleinbergs said, adding that both short- and long-term solutions are being considered.
One short-term solution could be the municipality’s involvement in tariff regulation. The city promises not to delay ongoing talks with the EM in order to reach an agreement as quickly as possible, as new tariffs are scheduled to take effect this autumn.
As previously reported, “Rīgas siltums” has submitted a tariff proposal to the Public Utilities Commission that would increase the price of heating by 21.5% from 74.17 euros per megawatt-hour (MWh) (excluding VAT) to 90.15 euros per MWh starting the 1st of September 2025.
The production tariff would rise by 16.6% to 62.99 euros per MWh, the transmission and distribution tariff would rise by 5.6% to 22.88 euros per MWh, while the sales tariff would remain unchanged at 1.83 euros per MWh. The excise duty component would increase by 53.8% to 0.40 euros per MWh, with unforeseen expenses accounting for 2.05 euros per MWh.
The company previously explained that
Riga’s heating system consists of two, currently unconnected, parts – heating networks on the left and right banks of the Daugava.
On the left bank and in Vecmīlgrāvis, heat is produced by “Rīgas siltums,” while heat for the right bank – which makes up two-thirds of Riga’s consumption – is purchased from other producers, primarily AS “Latvenergo.” Therefore, production and procurement costs are evaluated separately when calculating the tariff.
Minister of Economics Viktors Valainis (ZZS) told Latvian Television that the ministry has asked “Rīgas siltums” to reconsider the planned price hike.
It is also reported that the “Rīgas siltums” group’s turnover for the first half of the financial year (the 1st of October 2024 to the 31st of March 2025) was 189.28 million euros, down 12% compared to the same period the year before. However, group profit rose by 31.7%, reaching 33.38 million euros, according to publicly available company data.
The parent company “Rīgas siltums” had a turnover of 189.25 million euros, down 21.8%, while its profit decreased by 12% to 22.465 million euros.
“Rīgas siltums” is one of the main heat suppliers in Riga. The company’s capital is divided as follows: 49% owned by Riga City Council, 48.99% by the Latvian state, 2% by SIA “Enerģijas risinājumi. RIX”, and 0.005% by “Latvenergo.”
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