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Friday 23.08.2019 | Name days: Valgudis, Ralfs, Vitālijs
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Minister: MPC abolishment in Latvia may help reduce electricity bills by 20% in 2020

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUOnce the mandatory procurement component system has been abolished, Latvian residents’ electricity bills in 2020 may reduce by 20%, says Latvia’s Economy Minister Ralfs Nemiro.

He says Economy Ministry has time until 31 March to prepare documents for the abolishment of MPC system, which will be done. It is planned for the documents to be reviewed at the government’s next meeting.

Unfortunately, the legal process for the abolishment of MPC system performed by audit company KPMG is taking too long.

«The company has sent us a draft of the report. We intend to request corrections because some observations are stated in the form of probability – we want a clear assessment,» added Nemiro.

When asked if the Economy Ministry intends to present the government any final terms for MPC abolishment, the minister said first it is necessary to complete Saeima’s objective regarding preparation of documents for abolishment of the system before the end of March. Additionally, the government will be asked to provide two months of time for the ministry to develop a full plan for MPC system’s abolishment.

«It is possible to abolish MPC system in a single moment by pulling it from the Electricity Market Law. However, in this case we would have to accept high electricity wholesale trade price. On top of that, the EU could commence a violation procedure against Latvia for failure to comply with green energy ratio goal,» said the minister.

This is why Nemiro proposes viewing MPC abolishment matter in a complex way. He added that electricity price in bills makes up 30%, whereas electricity transmission forms more than one-third. MPC, on the other hand, is the smallest part of the end price.

«We will look at all sections to make sure bills reduce. We do not yet have accurate estimates. However, our goal is making sure bills reduce for all consumers by 20%. However, reduction of bills would be possible only if new regulations come to force, and their development will require at least a year. It is possible changes could come to force in 2020,» said the minister.


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