Will bills go down? Electricity distribution and transmission tariffs to go down in January

Electricity distribution and transmission tariffs will go down in Latvia starting with the 1st of January 2024, as reported by the Public Utilities Commission (SPRK).
The commission reports that new tariffs will come into force next year and replace the tariffs adopted on the 1st of July 2023.
According to estimates from SPRK experts, for users with a single-phase (F) 16-amp (A) connection and electricity consumption of 100 MWh a month, the distribution tariff could go down by about 6% in January 2024 when compared to July 2023.

At the same time, the regulator mentions the distribution tariff is only one of the components

that compose the end user electricity bill together with the electricity fee and value added tax (VAT).
Additionally, looking at Sadales tīkls JSC previous report, SPRK notes that the fixed portion of the tariff – the power maintenance fee – will go down by approximately 7-11% in January 2024 when compared to July 2023. Specific price drops will depend on the user connection and chosen tariff plan.
The fee for supplied kW will go down by about 1%. However, the specific drop of the variable fee will depend on monthly electricity consumption.
At the same time, the updated tariff of Augstsprieguma tīkls (AST), which consists of two components covering the costs of electricity transmission and power maintenance costs, will be 2.5% lower than the existing tariff.
SPRK council chairman Alda Ozola notes that the revision of differentiated tariffs for electricity distribution and transmission system services was in the interest of all users, and distribution and transmission system operators used all available tools to determine reduced tariff values. It is important to keep in mind that the inflation outlook for the coming years has changed. The same applies to forecasts of the price of electricity and, accordingly, the expected costs of ensuring losses of electricity and the technological process.
Ozola reminds that every household should check their options to reduce electricity bills and consider changing their power supply contract.
LETA previously reported that Sadales tīkls’ and Augstsprieguma tīkls’ new electricity system service tariffs came into force in July 2023.
The effect of new tariffs from ST on households varies. It depend on connection parameters and consumption. The cost also depends on whether there is a single-phase (1F) or three-phase (3F) connection and the type of connection (16A, 20A, 25A, 32A, 40A or more). Electricity consumption plays a major role as well.
For apartment owners who have a 1F connection and their consumption is 100 kWh a month, the bill went up by five to seven euros (excluding VAT). The increase is the same for private house owners with 1F connection and 125 kWh consumption.
In turn, the increase in the electricity bill for owners of private houses with a 3F connection varied, affected by the selected load. For 3F connection (16A or 20A), the increase in the bill was about 12 to 15 euros (excluding VAT), and for 3F connection with 25A and more – about 18 euros and more (excluding VAT).
Sadales tīkls is the maintainer and developer of the electricity grid in Latvia, which is part of the state-owned Latvenergo Group. The company provides the operation, restoration and planned development of distribution electricity networks, monitoring of electricity consumption, loss reduction measures and electricity accounting, as well as the creation of new connections.
AST is an independent Latvian electricity transmission system operator, which ensures the operation of the electricity transmission network and the safety of the electricity supply of the Latvian electricity system, provides transmission system services on the basis of published transmission service tariffs, performs operational management of the transmission system and ensures safe, stable, transmission of electricity in the transmission system. AST is owned by the Latvian State. The company’s shares are quoted on Nasdaq Riga list of debt securities.
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