1. Ainārs Meņģelsons Public Utilities Commission Latvia 9th Baltic ERI September 16, 2009 Vilnius, Lithuania LATEST UPDATE IN LATVIA

2. 2 9th Baltic ERI September 16, 2009 Vilnius, Lithuania Electricity Market Opening All households and non household consumers with less than 50 employees and yearly turnover less than 7 million LVL have the rights to use the universal service of electricity; Universal service – ability to be supplied by economically justified price; The consumers which do not qualifies to get universal service are obliged to buy electricity from traders for contract price;

3. 3 9th Baltic ERI September 16, 2009 Vilnius, Lithuania Electricity Market Opening The Commission granted rights to JSC Latvenergo from January 1, 2009 to set the tariffs for the captive customers by the company itself:  Commission within 21 days asses tariffs conformity with the calculation methodology and justification;  if the Commission does not reject tariffs proposal, it enter into force on the date indicated but the company;  if the Commission rejects tariff proposal tariffs do not enter in the force.

4. 4 9th Baltic ERI September 16, 2009 Vilnius, Lithuania Electricity Market Opening 32% of total electricity is traded for contract price (non-regulated); Since July 1, 2008 130 customers switched the supplier, 10 of them twice; On September 1, 2009 8% from free market customers purchase electricity from independent traders.

5. 5 9th Baltic ERI September 16, 2009 Vilnius, Lithuania New legislation On February 2009 new Regulations on RES-E were accepted Price is fixed for period of 10 years and reduced after according to formula As reference to set price for electricity from biomass is used natural gas price Prices are differentiated by: installed capacity type of fuel

6. 6 9th Baltic ERI September 16, 2009 Vilnius, Lithuania New legislation On February 2009 new Regulations on CHP were accepted  Introduced provision how to get qualified for capacity payment On July 2009 new regulations on electricity trade were accepted Reduced time of prior notice of customer’s switching from 3 to 2 months Adjusted balancing provisions

7. 7 9th Baltic ERI September 16, 2009 Vilnius, Lithuania

8. 8 9th Baltic ERI September 16, 2009 Vilnius, Lithuania THANK YOU FOR ATTENTION ! WWW.SPRK.GOV.LV