This year’s heating costs in Riga may increase 40% per household, as reported by Rīgas siltums board chairman Normunds Talcis at the 13 October meeting of the Housing Subcommittee of Saeima’s Public Administration and Local Government Committee.
The subcommittee discussed the situation at the start of the heating season, increased costs of energy resources and supplies energy resources in Riga and the country as a whole. Talcis said this year the company decided to provide heating to all houses in spite of any outstanding debts. Rīgas siltums will continue enforcing debts from each building. Nevertheless, residents of the capital city will not be left in the cold.
The company’s board chairman said prices of energy resources have increased sharply. Rīgas siltums has submitted tariff changes to the Public Utilities Commission. This means from 1 November onward prices will increase to 66 EUR/MWh. Talcis stressed that this is an unprecedented price, and the increase can be explained with energy price rise.
Talcis explained that the heating price is dictated by Latvenergo as well. For this company the price rise is more than 100%.
«We accumulated this increase into our tariff as much as we could, and we did this for 50%,» said Talcis, explaining that the company changed the tariff only at the expense of procured energy.
Commenting on the decision to provide heating energy to all residents in Riga, Rīgas namu pārvaldnieks (RNP) board chairman Ronalds Neimanis said its was RNP’s initiative. Heating services were provided to 2 500 houses following this decision. Six houses, however, remain without heating due to technical reasons.
As for debts, Neimanis reports that work with debtors has borne fruits in recent years – the total heating debt has reduced eight times. «This is grandiose result for RNP. It makes it possible to provide heat to 80% of customers. The remaining 20% require permission from Rīgas siltums,» says Neimanis.
He invited participants of the meeting to understand that the decision to connect heat was made based on pressure on RNP, economic situation and Covid-19 pandemic.
RNP believes it should be outlined in legislation that heating should not be cut from an entire house because of debts of individual apartments. He requested a resolution of this question so that RNP should not have to ask Rīgas siltums to provide heating every year.
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Deputy state secretary to the Ministry of Economics Edijs Šaicāns says the price increase is neither a national, nor regional scale – it is a challenge for the entirety of Europe. He said it has a cascade effect – if a price increases for one type of energy resource, the prices of other resources increases as well.
The biggest surge is observed in municipalities in which heating is provided by gas plants. The price surge there is felt far more clearly than areas that use biomass as fuel. Šaicāns mentioned that there are municipalities in which heating prices have reduced.
He said the ministry has outlined a potential solution for the government by providing support to less protected groups. As previously reported, Latvia’s government has agreed on providing support to less protected groups of residents when it comes to energy resources. On Thursday, 14 September, a discussion is planned with Latvian Association of Local Governments about the possible solutions.
Šaicāns promised that once the next support offer has been developed, it will be submitted to the government for approval.
He mentioned that the tariff has not changed for approximately 74% of municipalities, according to information from regulated businessmen. Public Utilities Commission (SPRK) CEO Jānis Miķelsons explained that the situation has changed in October because fuel price changes are major and tariffs have changed in certain municipalities.
The situation changed in Riga, Daugavpils and Jurmala in October. As for less populated areas – there are many different changes. It depends on whether or not entrepreneurs have signed contracts. Those that use wood chips for heating and had signed their contracts in summer experience no price increase, whereas those that signed their contracts closer to autumn generally observe a 10% – 15% increase, because demand is up.
Miķelsons stresses that it is not possible to procure wood chips for the price that was in summer.
Head of the subcommittee Regīna Ločmele asked the representative of Rīgas siltums why the tariff in Riga has increased 40% if tariffs in other municipalities remain unchanged. He responded by saying that the company was forced to increase prices because Latvenergo did it.
Ločmele asked if the Ministry of Economics could look into the relations between Rīgas siltums and Latvenergo. Šaicāns said no. He explained the ministry is unable to intervene in relations of two businesses because the ministry is not in charge of either of the two. The deputy state secretary to the Ministry of Economics stressed such an intervention would be unacceptable.
He also said this is not just Latvia’s, it is a problem for the European Union. «This is because of the natural gas price increase, which also influences Latvenergo’s tariff,» said Šaicāns.
Heating costs per household in Riga to grow 40%; similar trends observed elsewhere
