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Latvia

MARKET STRUCTURE

 
In Latvia, almost half the electricity consumption is provided by RES (47.1 per cent in 2004), with hydropower being the key resource. The growth observed between 1996 and 2002 can be ascribed to the so-called ‘double tariff’, which was phased out in 2003. This scheme was replaced by quotas that are adjusted annually. A body of RES-E legislation is currently under development in Latvia. Wind and biomass would benefit from clear support, since the potential in these areas is considerable.

KEY SUPPORT SCHEMES

 
The two main RES-E policies that have been followed in Latvia are:

1. Fixed FITs, which were phased out in 2003; and
2. A quota system, which has been in force since 2002, with authorised capacity levels of installations determined by the Cabinet of Ministers on an annual basis.

The main body of RES-E policy in Latvia is currently under development. Based on the Electricity Market Law of 2005, the Cabinet of Ministers must now develop and adopt regulations in 2006 to deal with the following areas:

• Pricing for renewable electricity;
  
• Eligibility criteria to determine which renewable energy sources qualify for mandatory procurement of electricity; and
  
• The procedure for receiving guarantees of origin for renewable electricity generated.

FUTURE TARGETS

 
According to the EU Directive, the RES-E share that Latvia is required to reach is 49.3 per cent of gross electricity consumption by 2010. Between 1997 and 2004, the Latvian RES-E share of gross electricity consumption increased from 42.4 per cent to 47.1 per cent.