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Monday 19.02.2018 | Name days: Zane, Zuzanna

Latvenergo plans to double 2011 electricity sales in neighbour countries

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Next year AS Latvenergo intends to expand their activities both in Lithuania and Estonia considerably, where the company plans to double this year’s sales volume, the power utility’s  Sales Director Davis Skulte said in an interview for AS Latvenergo journal Energoforums.

In the first six months of this year, Latvenergo sold approximately 266 Giga Watt-hours (GWh) of electricity to Lithuania, but 50 GWh have been sold to Estonia since April. As indicated by Skulte, in this period competitors in Latvia sold their customers 170 GWh. Consequently, the Latvian company’s balance is positive, as it has managed to sell more electricity in the Baltic market than its competitors in Latvia.

After the first six months, Latvenergo’s market share in Lithuania was approximately 5%, but in the second half of the year it reached 6%. While in Estonia, 3% of market was attained in the conclusion of first six months. Client portfolios in both countries represented different companies of various spheres – state institutions, small, medium-sized and large producers, as well as service and sales representatives. In Estonia there are approximately 30 major companies, but in Lithuania – 130.

Skulte indicates the Lithuanian market continues to evolve and starting from January 1, next year, a large number of undertakings will have to enter the market; accordingly, it will grow and more potential clients will appear. «This opens up new opportunities for us as well,» explained the company’s representative.

He specified the Latvian market is and will be Latvenergo’s base. In line with this year’s first six months data, Latvenergo’s market share in Latvia is about 95%, covering approximately 900 000 clients, including households. The rest of the market share belongs to competitors, most of whom are Estonia’s holding group Eesti Energia subsidiary Enefit customers. Both in Estonia and Latvia there are several so-called small traders.

Nevertheless, Skulte predicts that, with time, the Lithuanian company Lietuvos Energija will be represented in the electricity market segments of all three Baltic States. «I am sure the largest electricity retailers competition situation in the Baltic States will balance out in the following years,» commented Skulte.

To his mind, Latvenergo’s advantage is flexibility in terms of price and conditions, besides, the company is trying to introduce additional services. For instance, this year, in cooperation with the insurance company Balta, energy risk insurance was introduced, offering market customers to insure possible losses, which may arise in case of a power supply interruption. For example, If there is a storm, or because of third-party’s fault the power cable is damaged and the voltage disappears, insurer covers part of the customer’s loss. This service was introduced in summer, but Balta has already issued the first compensations to the clients.

The Lithuanian market has been opened since January 1, this year; but the Estonian – since April 1. In 2009 Latvenergo’s market share in the Baltic States reached up to 25%, but currently it forms approximately 28% – 30% of the total electricity consumption in the Baltics.

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  1. vcx says:

    Great plans, good luck!

    Thumb up 0 Thumb down 0

  2. T.d. says:

    That is good business planning and strategy.

    Thumb up 0 Thumb down 0

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