On July 1, onward JSC Latvijas Gaze plans to increase natural gas tariffs for households by between 65.6% and 89.9% depending on consumption, according to the entry in the Latvian Herald.
For households that consume up to 250 cubic meters a year, the differentiated end tariff with VAT and excise tax will increase by 65.7%, from 1.10209 EUR/cubic meter to 1.8252 EUR/cubic meter. For households that consume 250 to 500 cubic meters of gas a year, the end tariff will increase by 74.7%, from 0.96649 EUR/cubic meter to 1.6896 EUR/cubic meter.
At the same time, for households that consume 500 to 25,000 cubic meter of gas annually, the end tariff will increase by 89.9%, from 0.80405 EUR/cubic meter to 1.52715 EUR/cubic meter.
The fixed portion of the fee for natural gas will remain unchanged in the second half-year of 2022: the transmission service fee with VAT for load of up to 6 cubic meter/h will remain EUR 3.27, for load of 6.1 to 10 cubic meters/h the fee will be EUR 8.99, for a load up to 10.1 to 16 cubic meter/h the monthly fee will be EUR 14.36 and for a load of up to 16.1 to 25 cubic meter/h the fee will be EUR 21.91, whereas for a load of up to 25.1 to 40 cubic meters/h the fee will be EUR 32.55 a month.
Latvijas Gaze representatives say that in the second half-year of 2020 households that use natural gas only to prepare meals and consume 4 cubic meters a month will pay for gas approximately EUR 10.56 a month instead of the current price of EUR 7.67. For households that use gas for heating and consume an average of 180 cubic meters a month, the fee will increase from EUR 148 to EUR 278.15.
Chairman of the company Aigars Kalvitis noted the increase of natural gas energy costs was felt by households in the first half of the year. Nevertheless, it remains significantly lower than the gas price increase on the market. The tariff increase for households that have increased consumption was compensated thanks to state aid provided between January and April.
“Considering the increase price of natural gas on the global market, it is no longer possible to procure cheap gas. The gas procured in the previous season has already run out. This means we have to procure gas at a price that we have now. Tariffs for the second half of the year are calculated at 107.34 EUR/MWh,” explains Kalvitis.
The company notes that the increase of gas tariffs can be explained with both high price outlook on the western exchange for the next half-year and the price records observed in the previous half-year, because a small portion of consumption of households was provided by Latvijas Gaze using pipelines. The highest point was reached in April, when TTF Front Month index reached 130 EUR/MWh.
Current outlooks suggest that gas will still cost between 90 and 100 EUR/MWh until next spring.
The gas fee amount for households consists of five components – gas price, which is affected by the gas price fluctuations on the global market and which is calculated in accordance with the method developed by the Public Utilities Commission (SPRK); the fee for transmissions services, which is calculated by SPRK and JSC Conexus Baltic Grid; transmission system operator services, the tariff of which is calculated by SPRK and Gaso; as well as excise and VAT rate, which are regulated by the state.
For natural gas users whose annual gas consumption is under 25,000 cubic meters the tariff changes twice a year – January 1 and July 1. (BNN/Business World Magazine)
