The establishment of a parliamentary investigative commission on the reasons behind the price increases in the capital’s district heating and the energy security risks in Riga gives hope that every heating season will no longer be an insurmountable fear for residents. It is also a question of environmental pollution, heat-energy procurement, political influence, and other essential issues. On whether the “heat devil” in Riga is really as black as painted, BNN speaks with the initiator of the commission, opposition MP Andris Kulbergs (AS).
How is it that Riga has the most expensive heat? Is anyone actually controlling these tariff increases and checking whether they’re justified?
This is a problem that has been growing for years and let run in an uncontrolled direction. Heat energy makes up 53% of Latvia’s overall energy portfolio, while electricity accounts for only 14%. We’ve filled the public sphere and documents with electricity issues, strategies and so on, but for heat there are very few such documents—practically none. If we look at the energy strategy at the Ministry of Climate and Energy (KEM), we’ll find just one small chart about heat.
Historically, Riga has always had a lower heat tariff than Tallinn and Vilnius—by as much as 32%. Why? Because we had a unique solution that neither Vilnius nor Tallinn has, and still don’t. We have combined heat and power plants (CHPs) that produce electricity for the whole country, and even for the Baltics. These Latvenergo CHPs are located near the city, which is rare, and in the process of generating electricity, heat inevitably arises—whether we like to admit it or not. According to Latvenergo’s own published data, that’s 180,000 MWh per year, which Rīgas Siltums could use and take. In reality even more heat is produced; we just can’t take it all—for example in summer when demand is low.
For years, especially in crisis years, we have blown—and continue to blow—this produced heat into the air. From an ecological standpoint, simply venting this CHP heat into the air is highly unstatesmanlike, unhealthy and harmful to nature.
So 180,000 MWh of heat is vented into the air—along with CO₂ emissions, for which we pay allowances. We want to reduce CO₂ emissions in the country, avoid paying for allowances, meet the climate targets for 2040… Europe itself says we must primarily capture this by-product heat; yet we’ve put wood-chip boiler houses in its place, which produce three times more CO₂ and release all sorts of elements from the periodic table while producing only heat—heat that essentially is already produced in the electricity generation process—while also emitting particulates into the atmosphere.
About €30 million worth of heat is vented into the air each year; the windfall profit on the heat Latvenergo supplies to the city is another €30 million. The price could be lower if everything were done correctly by the Public Utilities Commission (hereinafter the Regulator), but private wood-chip boiler houses in Riga have snuck in under this inflated ceiling and rake in another €30 million in windfall profit annually. Rīgas Siltums itself, through inefficiency and mismanagement, squanders €20 million more.
Year after year the figures vary a bit, but in total Riga residents overpay about €110 million every year. We’re looking for ways to cut VAT on five basic foodstuffs and where to find €15 million for that—while here Riga residents overpay €110 million! Even casinos and gambling aren’t as profitable or as predictable and safe a business as wood-chip heat sources on Riga’s right bank.
As a result, we’ve ended up with the most expensive heat tariff among the Baltic capitals. Our district-heating network is unforgivably old and unreconstructed—the average age is 28.4 years, and some pipes are 50, 60, even 80 years old.
Residents have often fumed about the not-so-great condition of the heat mains—lawns turning green in winter over pipes that leak heat, and residents pay the bill…
Yes. But the “green lawn” is just the cherry on top; old pipes also carry a high risk of failure. For example, Tallinn’s network is a third shorter, yet they replace 27 km of pipe a year. We replace 6 km in recent years. To keep our network’s average age under 30 years, we need to replace 28–29 km annually. Therefore, we can conclude that with the highest heat tariff in the Baltics, we still manage to age our network—and that too pushes tariffs up. And despite the very expensive tariffs collected from Riga residents, there’s not even sufficient investment into the heat network that needs renewal. That indicates mismanagement in all directions.
This isn’t just a Riga issue; it’s an energy-security issue because it also diminishes the role of our CHPs. If we could plan to sell both electricity and heat simultaneously, we would have cheaper electricity and cheaper heat that Latvenergo cou
How is it that Riga has the most expensive heat? Is anyone actually controlling these tariff increases and checking whether they’re justified?
This is a problem that has been growing for years and let run in an uncontrolled direction. Heat energy makes up 53% of Latvia’s overall energy portfolio, while electricity accounts for only 14%. We’ve filled the public sphere and documents with electricity issues, strategies and so on, but for heat there are very few such documents—practically none. If we look at the energy strategy at the Ministry of Climate and Energy (KEM), we’ll find just one small chart about heat.
Historically, Riga has always had a lower heat tariff than Tallinn and Vilnius—by as much as 32%. Why? Because we had a unique solution that neither Vilnius nor Tallinn has, and still don’t. We have combined heat and power plants (CHPs) that produce electricity for the whole country, and even for the Baltics. These Latvenergo CHPs are located near the city, which is rare, and in the process of generating electricity, heat inevitably arises—whether we like to admit it or not. According to Latvenergo’s own published data, that’s 180,000 MWh per year, which Rīgas Siltums could use and take. In reality even more heat is produced; we just can’t take it all—for example in summer when demand is low.
For years, especially in crisis years, we have blown—and continue to blow—this produced heat into the air. From an ecological standpoint, simply venting this CHP heat into the air is highly unstatesmanlike, unhealthy and harmful to nature.
So 180,000 MWh of heat is vented into the air—along with CO₂ emissions, for which we pay allowances. We want to reduce CO₂ emissions in the country, avoid paying for allowances, meet the climate targets for 2040… Europe itself says we must primarily capture this by-product heat; yet we’ve put wood-chip boiler houses in its place, which produce three times more CO₂ and release all sorts of elements from the periodic table while producing only heat—heat that essentially is already produced in the electricity generation process—while also emitting particulates into the atmosphere.
About €30 million worth of heat is vented into the air each year; the windfall profit on the heat Latvenergo supplies to the city is another €30 million. The price could be lower if everything were done correctly by the Public Utilities Commission (hereinafter the Regulator), but private wood-chip boiler houses in Riga have snuck in under this inflated ceiling and rake in another €30 million in windfall profit annually. Rīgas Siltums itself, through inefficiency and mismanagement, squanders €20 million more.
Year after year the figures vary a bit, but in total Riga residents overpay about €110 million every year. We’re looking for ways to cut VAT on five basic foodstuffs and where to find €15 million for that—while here Riga residents overpay €110 million! Even casinos and gambling aren’t as profitable or as predictable and safe a business as wood-chip heat sources on Riga’s right bank.
As a result, we’ve ended up with the most expensive heat tariff among the Baltic capitals. Our district-heating network is unforgivably old and unreconstructed—the average age is 28.4 years, and some pipes are 50, 60, even 80 years old.
Residents have often fumed about the not-so-great condition of the heat mains—lawns turning green in winter over pipes that leak heat, and residents pay the bill…
Yes. But the “green lawn” is just the cherry on top; old pipes also carry a high risk of failure. For example, Tallinn’s network is a third shorter, yet they replace 27 km of pipe a year. We replace 6 km in recent years. To keep our network’s average age under 30 years, we need to replace 28–29 km annually. Therefore, we can conclude that with the highest heat tariff in the Baltics, we still manage to age our network—and that too pushes tariffs up. And despite the very expensive tariffs collected from Riga residents, there’s not even sufficient investment into the heat network that needs renewal. That indicates mismanagement in all directions.
This isn’t just a Riga issue; it’s an energy-security issue because it also diminishes the role of our CHPs. If we could plan to sell both electricity and heat simultaneously, we would have cheaper electricity and cheaper heat that Latvenergo cou