In order to improve competition on the electric energy market and a more competitive offer to energy consumers, the government supported amendments to electric energy trade and consumption regulations. They dictate that, starting from November 1, only those consumers that use electric energy for household needs will be allowed to procure electric energy at regulated tariffs.
The approved changes to specific Cabinet of Ministers regulations provide the rights to procure electric energy for regulated tariffs for households and electric energy consumers whose connection voltage does not exceed 400 V, nominal current of input apparatus of which does not exceed 100 A, and for those who procure electric energy to supply it further to sub-consumers.
The rest will need to procure electric energy by choosing one of many electric energy providers for bargain prices. Market participants can choose traders based on their offers; it is also allowed to change suppliers. There are currently 43 electric energy traders registered in Latvia, but only five are currently active, according to the information from the official website of Sadales tīkls.
A gradual opening of the electric energy market is noted throughout Europe, including Baltic Sea region countries. Estonia plans to completely open up its market starting from January 1, 2013. All Estonian consumers will buy electric energy according to the NordPool Spot exchange prices. Meanwhile, in Lithuania, starting from January 1, 2013, all consumers that are legal persons will become market participants; household regulation will be preserved until January 1, 2015, Economy Ministry reports.
Latvia’s energy market is already being gradually opened since 2007. Right now, there are 5 900 electric energy users on the open market, which is 0.7% of all consumers and consume around 66% of electric energy. Around 20 000 more users will join the free market on November 1, 2012, which is 2.3% more from the total number of users.
The expansion of the electric energy market will positively affect Latvia’s energy market’s future development, attracting more traders, improving competition between traders and ensuring a wider range of choice to users. Experience shows that the price for which market participants could procure electric energy has been either equal or lower than the regulated tariff electric energy price and the latest supply price. It can be predicted that prices could remain on a similar level in the next period as well. Therefore, becoming market participants will not create an additional burden for consumers; exactly the opposite – expenses of market participants could decrease, the ministry notes.