Government coalition agrees on support for households amid rising energy prices

RIGA - Latvia's government coalition on Monday reached an agreement on support that will be provided to households amid rapidly rising energy prices, Prime Minister Krisjanis Karins (New Unity) told journalists following the coalition meeting.

The support will be provided to people starting from July 1, 2022, which is earlier than agreed in June, Karins said. The prime minister indicated that those who have already received their new energy bills, will receive new recalculated bills, which will include the state support effective from July 1. The state will cover 50 percent of the energy price increase. 

Those who heat their homes with firewood will receive assistance as well, the prime minister said. 

Economics Minister Ilze Indriksone (National Alliance) added that the coalition has also agreed to expand support for households heating their homes with electric power. The support will be provided not only to those who use heat pumps but also those who use electricity as the primary source of heating in other ways. 

The government will look to make the provision of state support as simple as possible, the economics minister said, noting that this is the best way to provide support to those households that need it most. At the same time, Indriksone is aware of the social services' limited capacity. 

Karins said that the government will decide on the state support on Tuesday, August 9, with the Saeima expected to approve this decision on Thursday, August 11. The prime minister noted that the support mechanism has been worked out under the leadership of Welfare Minister Gatis Eglitis (Conservatives) and Indriksone. 

Karins also underlined that Indriksone has reassured the government coalition that Latvia's has enough gas stocks to make it through not only this year but also the whole heating season. This information is confirmed by data on gas stocks stored in the underground gas storage facility in Incukalns and already concluded gas supply agreements.

Welfare Minister Eglitis informed that a decision on construction of a liquefied natural gas (LNG) terminal in Latvia might follow in the next coming weeks. 

As reported, compensations to households for rapidly rising energy prices is the main topic on the agenda of Tuesday's government meeting. The government plans to increase the support package from the initially planned EUR 350 million to EUR 430 million.

The support period would be set from May 1, 2022 to April 30, 2023.