ACER calls for greater transparency in Latvian gas transmission tariffs
What is it about?
Today, ACER releases its report on the Latvian gas transmission tariffs, evaluating compliance of the proposed reference price methodology (RPM) with the requirements of the EU Network Code on Harmonised Transmission Tariff Structures.
What is the proposed methodology?
The Latvian regulator proposes to:
- Apply a uniform entry tariff of 142.77 EUR/MWh at all entry points within the Finnish-Estonian-Latvian (FinEstLat) market area, while removing tariffs at interconnection points within the area.
- Apply a reference price methodology to set tariffs for domestic exit points and for renewable and low-carbon gases’ injection points.
- Grant full tariff discounts (i.e. zero tariffs) for entry points from and exit points to storage facilities.
- Set the exit tariff to Lithuania using the same FinEstLat entry tariff (142.77 EUR/MWh).
- Replace the current commodity-based tariffs (linked to the volume of transported gas) at domestic exit points with new capacity-based tariffs (charged for contracted network capacity).
What are the key findings?
ACER concludes that:
- The consultation document does not provide all required information, including on the:
- comparison with the capacity-weighted distance methodology;
- impact of the FinEstLat tariff structure on cross-subsidisation; and
- method used to forecast contracted capacity.
- The proposed methodology complies with EU requirements on non-discrimination and volume risk.
- However, it does not comply with the requirements on cost-reflectivity, cross-subsidisation and cross-border trade.
What does ACER recommend?
ACER recommends that the Latvian energy regulator, when adopting its final decision:
- Follow ACER’s previous guidance (2023) on the FinEstLat market merger, monitoring how changes in gas flows could affect cross-subsidisation between networks.
- Switch to a capacity-based tariff system, allowing for a transitional period (if needed).
- Improve transparency by publishing the capacity-weighted distance components used in the cost allocation assessment.
- Compare capacity forecasts with those of neighbouring regulators and explain any differences found at the interconnection point with Lithuania.
Next steps
The Latvian regulator needs to adopt its final decision in time to publish the gas transmission tariffs by 6 June 2026.
See all ACER reports on national tariff consultation documents.