A high-level group has been set up to abolish the mandatory procurement payment system


In the meeting of Cabinet of Ministers held on April 17, 2018, a decision was made to set up a working group to abolish the system of the electricity mandatory procurement payment. The working group will be chaired by Deputy Prime Minister, Minister of Economy Arvils Ašeradens; the working group includes representatives from the energy sector organizations, major business organizations, universities, and state institutions. The first meeting of the working group is expected to be held next week.

“MPC, as it is today, is a fundamental, national and macroeconomic mistake that needs to be eliminated. Existing mechanisms to mitigate the impact of the MPC, which are at my disposal being the Minister of Economy, will be soon exhausted, and the government has to decide on the elimination of the MPC as a remnant of the “full speed” economy - the MPC must be abolished without any leniency towards unscrupulous manufacturers, creating instead a renewable energy production mechanism that is in the public interest both today and in the future. There is a strong political will to change this system, therefore, I am pleased with the support of the Cabinet of Ministers to my initiative to set up a high-level expert group for the abolition of the MPC,” emphasizes the Minister of Economy Arvils Ašeradens.

The working group has been assigned the following tasks:

  1. the assessment of the impact of the mandatory procurement component (hereinafter referred to as the MCP) and the subsidized electricity system on the national economy;
  2. proposals for cancellation of MCP as a payment mechanism;
  3. proposals for operation of existing support beneficiaries after the abolition of MCP payments.

In turn, the Ministry of Economics was asked to submit to the Cabinet of Ministers proposals for amendments to the regulatory enactments regarding the abolition of the MCP payment system for electricity, taking into account the proposals of the working group.

The Deputy Head of working group will be the State Secretary of the Ministry of Economics, Ēriks Eglītis, and the working group will comprise 24 participants - the heads and experts of the responsible ministries and state institutions, as well as the Latvian Employers 'Confederation, the Latvian Chamber of Commerce and Industry, the Foreign Investors' Council and other government social partners, as well as representatives of renewable energy industry associations.

Last update:    01-02-2019