This May has brought significant changes to the electricity market, affecting most households that generate their own electricity from renewable sources. As of 1 May, households with newly built solar panel systems can no longer participate in the former net metering system, while those already included in the system can continue to use it until the end of February 2029. There have also been significant changes to the deadlines for electricity traders to notify the system operator of new customers.
In the market's early days, electricity traders were required to give notice of a new customer at least two months in advance, but with the development of Sadales tīkls AS processes it has been possible to significantly shorten this notification period – to the 15th of the month prior to the start of the cooperation, which has become customary in recent years. As of this May, the standard procedure has been changed and the obligation to notify of a new customer has been moved from the 15th to the 9th.
As Jānis Bethers, Head of Energy Division at Virši, explains, these changes were necessary because over the last three years, the Latvian electricity market has seen a marked increase in activity and switching between traders: “Although the changes appear negligible – only a few days' notice is required – market practice indicates that the last few days before the 15th see the highest levels of customer activity, so it is important to remember to make your choice before the 9th. Timely comparison of offers will lend you freedom of choice, but after the 9th you will only be able to deal with your current trader.”
The new NETO billing system
Taking into the account that from now on, households installing solar panel systems will no longer be able to participate in net metering, they will be able to choose from the offers of traders within the new net settlement system.
“The most important difference is that the value of the electricity produced and fed into the grid will be determined in euros, rather than in kilowatt-hours as it used to be the case. The switch was hotly debated in 2023 and has generated so much interest and discussion in the industry that the pace of solar panel installations in the final months before net metering was comparable to the situation in autumn 2022, when electricity prices were at record highs.
The change is a response to the need to reduce the expected costs of maintaining the net accounting system,” explains Jānis Bethers.
More flexible offers for households
In the household segment, there is a trend towards more flexible contract terms for fixed prices. While 24 months used to be the standard offer, shorter offers of 6 months and longer contracts of 72 months are now available. This flexibility is the result of increased competition in the sector and traders' efforts to adapt to their customers' needs, allowing them to choose what suits them best.
Finally, the electricity market in spring is dynamic and changing, reflecting both challenges and opportunities for the sector. This demonstrates the need for continuous adaptation and cooperation between all market players to ensure that electricity supplies meet the needs of consumers," emphasises Virši expert.
Source: Changes have come into force following amendments to the Electricity Market Law.
About Virši:
Virši is a rapidly growing local energy trader and convenience store network with 29 years of experience. Currently, Virši has 77 sales points, 74 of which are service stations, and employs more than 800 people across Latvia. Since 11 November 2021, the shares of AS VIRŠI-A have been listed on the Nasdaq Riga First North Alternative Market.
Additional information:
Undīne Priekule
Communication Manager at Virši
Tel.: (+371) 26 141 219
E-mail: undine.priekule@virsi.lv
www.virsi.lv
