Distribution tariffs will not rise as steeply as planned, says Minister

The increase in tariffs for the "Distribution network" (Sadales tīkls, ST) and “High voltage network” (Augstsprieguma tīkls, AST) could be half the amount initially proposed, said Raimonds Čudars, the new Minister for Climate and Energy, in an interview to Latvian Radio December 21.

The distribution tariff change plan submitted by the State JSC “Sadales tīkls”, which provided for an average increase of 75% from July next year, was already criticized by the Economics Minister Ilze Indriksone and energy experts.

The short-term challenges of the Ministry of Climate and Energy are linked to tariff policy in energy. “It is our job at the moment to achieve, firstly, a reduction in [the proposed increase in tariffs]. And secondly, it is a more difficult task to lay out this tariff structure in a way that is comprehensible and that we do not harm our future targets of increasing the share of renewable energy sources in the electricity market,” said Čudars.

At the same time, he acknowledged that tariff increases encouraged by the ST and AST were linked to objective conditions such as increasing electricity prices worldwide.

“At the moment, it is clear that a total reduction of about half can be achieved compared to the proposed tariff increase,” the minister said.

It will be a matter of increasing the tariff for some groups of users. " We understand that there are many interests here: households, industry […], renewable electricity producers who transfer electricity to the grid. All these categories are connected to networks and solutions should be searched for. And then there is the question of how the connection fee is divided into these categories. Each of these groups of society, of course, appeals that we need more favorable tariffs. Then there's a question – at the expense of what?” Čudars said.

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