Energy, Latvia, Legislation

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President: it would be inappropriate to blame current Commission’s management for Latvenergo differentiated electricity rates

Alla Petrova, BC, Riga, 26.06.2012.Print version
It would be illogical and inappropriate to blame the current management of the Public Utilities Commission (PUC) for the commission's decision to approve Latvenergo differentiated electricity rates, President Andris Berzins told the LNT morning show "900 sekundes" today.

The commission's management has changed and it would be wrong to blame the current management for the Latvenergo rates that were lifted by the Administrative Regional Court yesterday, explained the president.


According to Berzins, the current electricity rates are illogical, and the system should be made easier to understand, writes LETA.


If the Administrative Regional Court's decision on the current electricity rates comes into force, Latvenergo last year's financial indicators will be on the agenda again, pointed out the president.


"This decision was made too late and could cause negative consequences," said Berzins.

As reported, yesterday, the Administrative Regional Court ruled in favor of several private individuals and legal entities claiming that Latvenergo differentiated electricity rates, adopted in February 2011, be lifted.


The court yesterday overturned the Public Utilities Commission's Decree No. 40, adopted on February 16, 2011, endorsing the new Latvenergo rates.


The court concluded that the differentiated electricity rates were not in accord with the Public Utilities Commission's principle that rates must be based on economically justified cost calculations and meant to ensure a given company's profitability.


The court concluded that there were no documents showing the cost of electricity sales, whereas the Public Utilities Commission's decision was based on Latvenergo's estimates, however, it is unknown how these estimates were calculated.


The court ruling may be appealed to the Supreme Court within thirty days.


Latvenergo said yesterday evening that the court ruling would be appealed, because the electricity rates were economically justified.


According to the current Latvenergo tariffs, households consuming more electricity annually have to pay more. The first 1,200 kilowatt/hours cost 8.25 santims per kWh. When this limit is exceeded, the tariff is 10.74 santims per kWh.

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