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Monday 17.02.2020 | Name days: Konstance, Donats
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Media: termination of contract with Tīrīga could cost Riga one million euros

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If the court of justice approves Competition Council’s (CC) decision to prohibit waste management company Tīrīga from establishing a monopoly, Riga municipality may have to pay private businesses compensation worth EUR 1 million and repay investments, as reported by TV3 programme Nekā Personīga.

The programme reports that if no contract is signed by Riga City Council, Getliņi Eko and Tīrīga, the city council will have to pay private partners compensation worth EUR 1 million, as well as compensate investments. One of the companies that is part of TīrīgaClean R – has purchased 17 new garbage collectors and dump trucks, as well as several cars, journalists report.

Journalists have accessed the contract worth EUR 676 million between the municipality and private partners. The contract states that Riga’s residents are to pay more and more for waste management in future years.

Nekā personīga has concluded that Riga residents’ expenses for waste management will increase from a couple of per cent up to a maximum of 60%. According to the concession contract, the pay for carrying 1 m3 of waste in the first year will be EUR 17.65 (no VAT) with a gradual increase to EUR 23.41 in 2020. Estimates do not include change with nature tax. Nevertheless, tariffs will increase even more rapidly together with tax increase.

Although transportation of sorted waste should be performed free of charge, the fee for it is still included in the tariff. Each 1 m3 of waste brings profits worth EUR 0.09, Nekā personīga reports.

The section that could reduce the tariff is income from sale of sorted waste. However, the digit ‘zero’ is written in this section for the entirety of 20 years. The 171-page large contract does not mention who will receive income from raw materials fit for recycling, journalists report.

Currently 90% of all recyclable packaging in Latvia is bought by two companies. The combined annual turnover of the two companies reaches EUR 16 million. One of them is Latvijas zaļais punkts, which has close ties with Tīrīga’s member Eco Baltia vide.

«This system has long since been organized in a way that when new duties appear, they are put on the shoulders of waste managers, whereas the price remains uncontrolled, which means no costs are under control,» Nekā personīga was told by Latvia’s Environment Protection and Regional Development Minister Juris Pūce.

«We don’t know the cost of transportation of sorted waste or its recycling. None of these indexes have ever been checked by any institution in Latvia,» admits Pūce.

Outdated contract and «bargain» dealer

The justification for handing Riga’s waste management market to a single company is based on results of a study performed in 2015. It cost EUR 48 000 and recommended forming a joint company together with private businesses. However, according to Nekā personīga, the study is outdated now, because Latvia is committed to creating a waste deposit system. On top of that, the study does not explain the basis for expectations for investments in Riga’s waste management sector.

The study itself was performed by Geo Consultants and Konsorts, who, according to Nekā personīga, are based in the same building. Neither company agreed to speak with journalists, because Riga City Council did not give them permission.

Geo Consultants has won many state and municipal tenders in the past. Among its owners are University of Latvia vice-rector Valdis Segliņš and Latvian Waste Management Companies Union’s board member Jānis Ābeltiņš. Konsorts was founded by and is now managed by once Latvia’s Finance Minister Uldis Osis. He was an advisor to then the Prime Minister of Latvia Andris Šķēle.

To organize the tender, Riga municipality hired lawyer Edgars Atlācis, who was briefly in charge of Getliņi Eko’s procurement commission in 2013. At the time, contrition of a recycling plant was entrusted to a company owned by Šķēle – Vides pakalpojumu grupa.

The recycling plant’s design and construction supervision was provided by Geo Consultants. Šķēle’s name no longer appears among the company’s owners. The firm itself has been added to one of Tīrīga’s monopolists Clean R, Nekā personīga reports.


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