Electricity Market Law of Latvia

By project BIOWIND

Published on 23 May 2024

Latvia

About this good practice

1.Electricity Market Law (EML) was introduced to address issues within energy sector,including need for competitive and efficient market,ensuring reliable and high-quality electricity supply,promoting use of RES. Challenge was to increase social acceptance of wind energy projects. Context for this practice was growing need for sustainable energy solutions,necessity to integrate community interests in planning of large-scale RE projects.
2.Primary objective of EML concerning wind energy is to enhance social acceptance through environmental and community-based planning. This is achieved by mandating that wind power plants (WPP) with a capacity of 1 MW or more make payments based on their installed total capacity to support local community development. Approach ensures that communities directly benefit from presence of WPP, thereby fostering more supportive environment for RE projects. Implementation of practice involves: establishing legal requirements for payments from wind power operators (WPO) to local communities; creating transparent mechanisms for calculation and distribution of these payments;engaging local stakeholders in planning process to ensure that community needs and concerns are addressed;monitoring and ensuring compliance with payment obligations through regulatory oversight.
3.Main Stakeholders: government,regulatory bodies,WPO, local community organizations. Beneficiaries: local communities where WPP are located benefit directly from the payments made by WPO.

Resources needed

There were needed the negotiations among the governmental stakeholders to be willing to reach the energy independence of Latvia and foster the self supply of RES energy. Additional institutional capacity was needed to harmonize the policy and its related regulations among the involved parties.

Evidence of success

Changes of law adopted on01.05.2024 include enhancement in community involvement mechanisms.Law is considered good practice because it successfully integrates RE into market while supporting local communities. Evidence of its success includes the financial contributions from wind power plants (1 MW or more) to local community development. This has accelerated improvements of public acceptance for wind projects, demonstrated by increased community support and investment in local infrastructure.

Potential for learning or transfer

The practice of the Electricity Market Law in Latvia, particularly regarding payments from wind power plants to local communities, is noteworthy for other regions. Key success factors include the direct financial benefits to local communities, fostering greater acceptance of renewable projects. Challenges for transfer may include varying regulatory environments and community engagement levels. The integration of community benefits can be complex, requiring clear policies and stakeholder collaboration. This practice has the potential to be adapted in regions with supportive regulatory frameworks and strong community engagement mechanisms. Successful adaptation depends on addressing local needs and ensuring transparent implementation.