Today, for the second week in a row, the coalition has been unable to secure a quorum in votes on controversial issues.
As the opposition used the opportunity to “break the quorum,” the Saeima once again on Thursday failed to adopt, in the second and final reading, amendments to the Law “On Pollution,” which are intended to transpose into Latvian law the EU directives regulating the operation of the European Union Emissions Trading System (ETS) and the Emissions Trading System in the buildings, transport, and additional sectors (ETS2).
After several rounds of voting, only 48 MPs voted on the sixth amendment of the bill. Due to the lack of quorum, Speaker of the Saeima Daiga Mieriņa (ZZS) closed the parliamentary sitting.
The Saeima consists of 100 representatives of the people, or MPs. According to the Constitution and the Rules of Procedure of the Saeima, parliamentary sittings can only take place if at least half of the MPs, that is, 50 deputies, are present – this is the minimum number required, i.e., the quorum.
The opposition also “broke the quorum” in the previous parliamentary sitting,
leading to its closure without MPs reviewing a number of draft laws.
Edgars Tavars, head of the Saeima faction of the United List, when discussing the amendments to the Law “On Pollution,” argued that the loss to society and the national economy would be disproportionately greater than the potential fines resulting from the failure to transpose the directives.
Tavars called on MPs, as he had a week earlier, not to vote for this bill, as well as not to vote for the related Economic Sustainability Bill. “Coalition – this is your responsibility, your commitments, and it is you who must ensure all this,” Tavars said.
Deputy Atis Labucis (JV) noted that today the Saeima’s Committee on National Economy, Agricultural, Environmental, and Regional Policy held an extraordinary sitting, during which the Ministry of Climate and Energy (MoCE) explained that, if this law is not adopted, Latvia will have to pay several hundred million euros in fines. The deadline is November 1. “I would still call for common sense to prevail and to support [this bill],” Labucis said.
As reported, the parliament also failed to adopt the bill last week,
as the coalition parties could not secure a quorum. Back then, after several votes, 48 deputies supported the first amendment of the bill, and Speaker Mieriņa closed the sitting.
Kaspars Briškens (P), Chair of the Saeima Committee on National Economy, Agricultural, Environmental, and Regional Policy, responsible for the bill, told the LETA news agency last week that the opposition’s coordinated move to break the quorum before the consideration of the Law “On Pollution” was an act of national irresponsibility that effectively sabotages the state’s interests.
The MoCE explained that Latvia has not yet transposed the provisions of the EU directives, as a result of which three infringement procedures have already been launched against Latvia. At present, the transposition of amendments to the main ETS directive is more than a year overdue, creating not only the risk of fines imposed by the European Commission but also administrative obstacles for ETS operators and complicating the administration of ETS for all parties involved.
The bill has been developed to improve and update climate policy regulation for the functioning of ETS in Latvia, while also updating the content of the law by including changes in line with institutional reorganizations. Moreover, since 2001, the law has been amended 21 times, making the ETS provisions fragmented and necessitating a restructuring of its framework.
The draft law includes a new chapter concerning the EU Emissions Trading System,
which lays down regulations on the operation of ETS and ETS2, including conditions, requirements, permits, and obligations. Provisions on ETS have been removed from other chapters.
The amendments also set out requirements relating to the activities of operators, aircraft operators, and shipping companies, or fuel and combustion operators. Operators will be required to take measures that promote the reduction of greenhouse gas (GHG) emissions. To determine changes in the amount of emitted GHGs, operators will have to monitor the emissions produced.
The State Environmental Service (SES) will be obliged to determine which installations correspond to activities requiring a GHG permit. If an operator operates without a valid GHG permit, the SES will be able, within its competence, to issue an administrative act suspending the operation of the installation.
The law also includes amendments concerning the introduction of ETS2 in Latvia. This will cover fuel and combustion consumption in buildings, transport, and additional sectors (industrial sectors not currently covered by ETS). ETS2 was created by extending ETS, and although the systems have similar management principles, the allocation of emission allowances and their trading are separated. From 2028, ETS2 emission allowances for fuel and combustion operators will have to be surrendered in proportion to the amount of fuel and combustion released for consumption within ETS2-covered activities.
Emissions will be determined indirectly,
based on the amount of fuel or combustion placed on the market for consumption.
Fuel and combustion operators will be the sellers of fuel and combustion in Latvia who place it on the market for consumption and who must obtain a GHG permit issued by the SES. From the introduction of ETS2, data monitoring must take place according to an individually developed monitoring plan for each fuel and combustion operator.
ETS2 monitoring and reporting requirements are based on ETS principles, ensuring consistency between the two systems. Cabinet of Ministers regulations will specify monitoring procedures, reporting and approval principles, as well as compensation mechanisms for cases when the same fuel or combustion volumes are accounted for in both ETS and ETS2.
The amendments stipulate that a state fee must be paid for the issuance and revision of a GHG permit. The payers of this new state fee are ETS operators (installations) and ETS2 fuel and combustion operators that are legal entities requiring a GHG permit. In Latvia, during the fourth ETS period from 2021 to 2030,
GHG permits were issued to 52 installations (38 operators).
To obtain an ETS and ETS2 GHG permit, operators must demonstrate that monitoring of GHG emissions and of the amount of fuel and combustion placed on the market for consumption enables the precise determination of annual GHG emissions and compliance with annual reporting requirements under ETS or ETS2.
The purpose of the fee is to ensure regulation and supervision of activities in the environmental field. The state fee will encourage operators to prepare sufficient and necessary applications to obtain a permit. GHG permits ensure the availability of accurate information on stationary installations and activities covered by the EU ETS and ETS2.
It is planned that the detailed procedure and amount of the fee will be determined by the Cabinet of Ministers. It is foreseen that it will be set together with the procedure and amount of state fees for Category A and B permits under the Law on Polluting Activities.
All these state fees will be administered by the SES, and a single installation may be subject to both a Category A or B permit and a GHG permit. There will be cases where multiple state fees must be paid simultaneously – for amendments to a Category A or B permit and to a GHG permit if significant changes are made to the installation.
For public information purposes, the SES will provide free electronic access to registers of GHG permits.
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