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Wednesday 17.10.2018 | Name days: Karīna, Gaits
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Programme: government continues working on MPC plan’s cancellation

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUThe disproportionate mandatory procurement component costs have become one of the biggest political scandals in Latvia since autumn last year. Attempts to put an end to the MPC system are continuing alongside the search of those responsible for the dysfunctional system. The government’s work group say it is impossible to completely cancel the system, as reported by Nekā Personīga programme.

It would cause litigations with millions of losses the country would have to pay to producers of subsidized electricity. Even prosecutor general Ēriks Kalnmeiers’ decision to ask the Constitutional Court to cancel MPC system has failed. Last week it became clear the court has rejected the prosecution office’s arguments and has decided not to review the case, as confirmed by the programme.

The Constitutional Court had refused to view the prosecutor general’s request to cancel MPC system the week before. Now it is clear that this task is beyond the government’s commission. All hopes to see MPC system go have now vanished, Nekā Personīga continues.

Kalnmeiers wanted to end the MPC system using legal methods. He asked the Constitutional Court to find it non-compliant with the Constitution of the Republic of Latvia. Had the request been satisfied in court, electricity producers would have lost grants with no option to recover losses from the state. However, the Constitutional Court refused to view the case, because the application lacks legal arguments that support the claim that MPC regulations violate the Constitution.

Prosecutor general: «We are evaluating our application. The final decision has yet to be made. We will try expanding it, finding the link and trying again. The Constitutional Court Law does not prohibit doing that in cases when refusal to make decisions has been provided.»

The prosecutor general now considers the possibility of attracting energy specialists to help improve the application. Kalnmeiers does not want to drop the case entirely, it seems, the programme reports.

Kalnmeiers: «We do not exclude the possibility of there being specialists ready to participate independently and exchange information with us. The last option is admitting there is nothing we can do.»

Economy Minister Arvils Ašeradens is also sad for the prosecutor’s failure. The minister hoped the Constitutional Court would respond to the question as to whether or not the state will be protected from litigations involving electricity producers if they lose grants. It is a question worth billions, comments Nekā Personīga.

Minister: «One of the mechanisms that could help resolve the MPC system matter is a full cancellation of MPC payments. Had the court reviewed this case, we would’ve had an answer. Our biggest challenge is avoiding unnecessary litigations.»

The programme comments: «Ašeradens tried combating excessive MPC system with political methods – by changing laws. He is the head of the government’s work group that is in charge of developing proposals to cancel MPC system. The work group includes representatives from Latvenergo, Public Utilities Commission, ministries and public organizations. So far experts have had four meetings. They have discussed MPC system’s history, goals and cancellation scenarios. Members of the work group interviewed by Nekā Personīga are confident this goal is unreachable.»

The work group has voiced proposals to cease procuring electricity from hydro and wind stations that have been receiving support for more than a decade. Members of the group also discussed the option to not pay stations that use Russian gas. There was also a proposal to use Latvenergo’s profits to reduce MPC burden, notes Nekā Personīga.

Economy Minister Arvils Ašeradens: «If MPC payment remains, it will be much, much smaller than it is now».


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