Latven­ergo: elec­tric­ity price has de­clined 30% in the past three years

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Av­er­age elec­tric­ity price in Latvia has de­clined in re­cent years. The av­er­age price of elec­tric­ity has de­clined by 30% at Nord Pool ex­change be­tween 2014 and 2017, al­low­ing end user costs to de­cline, says Latven­ergo.

Ac­cord­ing to the com­pany’s rep­re­sen­ta­tive, elec­tric­ity prices in Latvia have come very close to prices found in Scan­di­navia. From now on, elec­tric­ity prices in Latvia will be af­fected by fac­tors in Scan­di­navia. Elec­tric­ity prices in Latvia de­clined in 2017, con­tin­u­ing the trend es­tab­lished by pre­vi­ous years. The price de­cline was mainly due to the open­ing of a new con­nec­tion in the re­gion, which al­lowed Latvia to join Scan­di­navia’s elec­tric­ity mar­ket and con­trib­uted to price equal­iza­tion in the re­gion, Latven­ergo ex­plains. The last of the con­nec­tions – NortBalt ca­ble con­nect­ing Lithua­nia with Swe­den – was opened in spring 2016. This ca­ble en­sures prices are more equal and com­pet­i­tive with prices in Fin­land, with which Baltic States are con­nected the most closely. Latven­ergo Elec­tric­ity Sales Di­rec­tor Uldis Mucinieks: «Equal­iza­tion of prices with Scan­di­navia im­proves Latvia’s com­pet­i­tive­ness. While in 2015 the dif­fer­ence be­tween elec­tric­ity prices in Fin­land and Latvia was ap­prox­i­mately 40%, it has since de­clined to 5%. This is why it will have a pos­i­tive ef­fect on Latvia’s na­tional econ­omy, in­creas­ing the com­pet­i­tive­ness of en­ergy-in­ten­sive com­pa­nies.»

He also em­pha­sizes that trends left from pre­vi­ous years can cre­ate a wrong im­pres­sion – that elec­tric­ity prices de­cline ev­ery year, and that this should con­tinue. «The trend ob­served through­out 2014 – 2017 pe­riod was en­sured by the devel­op­ment of mu­tual con­nec­tions, im­prov­ing the equal­iza­tion of prices with coun­tries of the Scan­di­na­vian re­gion. Now that an ap­pro­pri­ate level has been reached, we have to keep in mind that price dy­nam­ics in Latvia can vary year to year,» Mucinieks con­tin­ues. The experts said this is demon­strated well by the ex­am­ple set by Es­to­nia – the coun­try al­ready had close con­nec­tiv­ity with Fin­land be­fore 2014. «While in Latvia we have got­ten used to see­ing an­nual price re­duc­tions, 2017 for Es­to­nia turned out the sec­ond year with grow­ing elec­tric­ity prices. This demon­strated that the ex­change there has a dy­namic char­ac­ter and that it can ex­pe­ri­ence growth and de­cline, which is some­thing con­sumers should keep in mind,» ex­plains Mucinieks.

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