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Sunday 20.08.2017 | Name days: Bernhards, Boriss

Green energy millionaires fear reforms

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Economy Minister Daniels Pavluts

It emerges that certain forces could be plotting to call on Economy Minister Daniels Pavluts to step down. This is because the reforms he has in mind scare green energy businessmen.

The timing coincides with speculations that Reform Party (RP) could name Pavluts for the post of Riga Mayor, reports whistle-blower Pietiek.

There are quite apparent links between those allegedly willing to demand Pavluts’ resignation and those behind the “black PR” campaig against him. It appears that the parade is orchestrated by millionaires, who make huge money from green energy subsidies. Obviously, they do not want things to change.

Economy Minister as well as RP Deputy Chairs Sandra Sondore-Kukule and Edgars Rinkevics deny that the idea to nominate Pavluts as Riga Mayor is a way to retreat. They explain that also other RP ministers have come under fire due to the reforms the have intended. Threats to call for resignation have also been directed towards Roberts Kilis (Education Minister) and Edmunds Sprudzs (Environmental Protection and Regional Development Minister).

“I hear rumour, but I do not see any legitimate threats. Apart from what may be discussed in Old Riga cafes, currently no one questions the performance of Economy Minister. Neither officially, nor unofficially. Those who want to legitimately raise the question of resignation will have to present exact reasons why they are not satisfied,” says Sondore-Kukule.

She implies that those willing to call on Pavluts to step down might include businesses that fear his reforms.

Back on August 28, the government meeting was attended by the independent MP Klavs Olsteins, who spoke of arguments against cutting support to cogeneration businesses.

He represented the group of six independent MPs, who have been trying to put off the new regulations. Olsteins was previously thought to be willing to avoid such obvious demonstration of green energy lobby. But it turns out he is not, reports Pietiek.

Olsteins did not, however, answer clearly whether or not he would support resignation calls. But another group-of-six MP Gunars Rusins reveals that they have not agreed on a common standpoint.

“We have discussed this and come to a conclusion that Pavluts is quite a powerful minister. He does not seem to have any selfish interest in reforms that he is carrying out to arrange the system,” he says.

“If someone indeed called for my resignation, I would, of course, see it as a political failure. It would mean that we were not wise enough to complete the reforms. But I will not drop the idea just to do away with any threat of resignation calls. That is not the price I am willing to pay,” says Pavluts.

In August 28 government meeting, Pavluts agreed to extend the transition to the new restrictions (from 2013 to 2016). He calls it a “reasonable compromise”, so that this part of the reforms is not abandoned.

The reason why the State Chancellery lawyers objected to a fast shift to the new restrictions is that foreign investors could sue Latvia in the International Court of Arbitration.

Pavluts refuses to guess what political tasks could be hidden behind the need to find legal grounds for vetoing the reforms.

He also dismisses rumour that he was once offered a million lats ($ 1.85m) to drop the idea of green energy reforms. However, knowing the super-wealthy companies (wind farms, cogeneration plants and biofuels businesses) feeding from state subsidies, the amount of the bribe seems quite realistic.

There is one more fact that sheds light on the interests of those trying to shake Pavluts’ positions. The black PR targeted against him involves the same PR specialists, who have provided services to businessmen interested in changing the political course of the Economy Ministry.

According to Pietiek, the black PR campaign has been allocated unlimited funds. PR company Baltijas komunikaciju centrs (BKC) serves as a channel through which the media are sent numerous speculations about Pavluts working to please his former employer Swedbank.

BKC clients include millionaires associated with the association For Latvia’s Development, founded by Einars Repse. Many of them fear the reforms, because they would deprive green energy businesses of huge funds.

Logging company Pata AB, owned by Uldis Mierklans, would also suffer. Back when Artis Kampars served as Economy Minister, it won many public orders and took up green energy business by becoming a supplier of wood chips.

It should be added that Olsteins has worked for Mierkalns as a lawyer (back then he was already working at the Economy Ministry). In the firm, he was responsible for overseeing establishment of offshore companies.

Under Kampars, businessmen close to the ruling party Unity were generously allocated mandatory state procurement quotas. But the reforms intend to abandon the practice, thus also hitting wind power businessman Olafs Berkis.

Berkis’ team in the so-called Ventspils war over AS Ventbunkers is also represented by BKC.

The PR company has also provided services to another member of Repses’ association – Donats Vaitaitis, owner of bioethanol producer Jaunpagasts.

Vaitaitis is believed to lose the most if Pavluts does not change his policy and drops direct subsidization of green power producers.

According to Pietiek, BKC owner Gints Feders denies that his company is in charge of the black PR campaign against Pavluts. Neither does he confirm that certain angry millionaires are paying to discredit the minister.

“We do not disclose our clients. But I can say that none of our existing customers has hired us for such a purpose. Neither Mierkalns, nor Berkis and Vaitaitis have ever been our clients,” he says.

He reveals, though, that they did collaborate with Mierklans’ company Pata AB about a year ago.

“The company represented Vaitaitis’ interests some time ago. But speaking about Berkis, BKC PR specialist Marcis Krastins once informed Pietiek and other media outlets about Berkis’ view on the fight for AS Ventbunkers. In the winter of 2011, he also organized Berkis’ interviews for different news agencies,” sources close to BKC tell Pietiek.

Feders argues that perhaps his employee did this on his own.


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