In the second half of 2021, the final tariffs for natural gas trade for households will increase by 1-2 eurocents for each kilowatt hour (kWh) consumed, including value added tax (VAT) and excise duty if natural gas is used as fuel.
The fixed fee of Gaso will be EUR 3.27 per month (including VAT). The increase in gas tariffs of Gaso is related to the necessary investments in the maintenance and renewal of the network to ensure a secure supply of natural gas.
The payment for natural gas to households consists of five components – the price of natural gas, which is affected by the price fluctuations of the resource in the world markets and is calculated in accordance with the methodology approved by PUC, transmission service fee calculated and agreed with PUC by Conexus Baltic Grid, the distribution operator services, the tariffs of which are calculated and coordinated with PUC by Gaso, as well as excise and value added tax regulated by the state.
Natural gas prices are set by the free market, i.e., prices fluctuate depending on the global situation, as they are linked to the European gas exchange indices. Latvijas Gāze, as a public trader, reviews prices for households twice a year in accordance with the methodology approved by the PUC. In this way, the state can be sure that residents do not overpay for natural gas, but the company makes a profit to provide a quality service.
If in the summer of 2020, based on the above-mentioned methodology and the market situation, we were able to reduce the natural gas prices to the lowest level in the last 12 years, then this year, prices will unfortunately increase.
In the last 12 months, in the international market, the natural gas prices per megawatt hour have increased approximately four times, reaching almost EUR 25 per megawatt hour. Nevertheless, we have been able to keep the price of natural gas for households at EUR 20.25 per megawatt hour, which is around 20% lower than the current actual purchase price.
The increase in the price of natural gas in international markets is related to several events in Europe. The last winter was relatively colder across Europe than in other years, leading to an increase in gas consumption. In addition, the spring was not so warm. Thus, the European gas storage is currently experiencing the lowest level of natural gas in the last three years, leading to the increased demand for natural gas injection for the winter season, increasing demand and, consequently, the natural gas prices. The natural gas market is affected by the geopolitical situation as well.
Customers will be notified of new Balanced Payment amounts
From July to the end of September, all household customers will receive letters, which will indicate a new monthly payment. Starting from August, the amount of the new Balanced Payment will be available on the customer portal, and from then on, the payments shall be made in accordance with the new tariff.
Letters with new amounts of the Balanced Payment will also be sent to the customers who have already received a report this year, so that no higher amounts are formed for payment when the next annual report is received.
Customers who have paid in advance for several months or a year will also receive a letter from us with the new payment schedule. It will be created considering the payments already made.
In the section Tariffs and calculator one can calculate the forecasted payment for natural gas.
