Background information

As the price of energy resources was still extraordinarily high, the government has decided to approve the support for energy-intensive manufacturing companies. The assistance package was prepared by the Ministry of Economy. The government approved the assistance package as amendments to the law on Assistance for Mitigating the Economic Consequences Caused by the Sanctions and Countermeasures Imposed due to the Military Aggression of Russia against Ukraine in force from 14 September 2022.

Content of measure

Support for energy-intensive businesses in the manufacturing industry is available in the form of a grant. Grant support for compensating the increase in the prices of natural gas and electricity resources for one company is up to 30% of the costs of natural gas or electricity, not exceeding €2 million in total for one company.

Support is available to companies who meet the following conditions:

• the company performs basic economic activity in one of the more than 220 NACE 2- or 4-digit manufacturing sectors mentioned in the Annex to the Cabinet of Ministers' Regulations.
• its energy resource costs make up at least 3% of the company's total economic activity costs.
• the total electricity consumption for the company's needs in 2021 was at least 500 MWh or the total gas consumption in 2021 was at least 500 MWh.

State budget funding in the amount of €50 million is allocated for the provision of support to energy-intensive processing industry merchants.

Use of measure

The allocated State budget of €50 million for the provision of support to energy-intensive processing industry merchants allows providing support to approximately 400 companies.

Target groups

Workers	Businesses	Citizens
Does not apply to workers	Other businesses	Does not apply to citizens

Actors and funding

Actors	Funding
National government	National funds

Social partners

Social partners' role in designing the measure and form of involvement:

	Trade unions	Employers' organisations
Role	No involvement	Informed
Form	Not applicable	Not applicable

Social partners' role in the implementation, monitoring and assessment phase:

• Only employers' organisations
• Main level of involvement: Peak or cross-sectoral level

Involvement

The peak level employers’ organisation the Latvian Employers’ confederation (LDDK) agreed that support for energy-intensive manufacturing companies is necessary. However LDDK draws attention to the fact that in the situation caused by Russia's military aggression against Ukraine and its negative impact on Latvia's economy and economic operators, support is needed not only for manufacturing companies, but also for various service providers whose activities are limited by the impact of the war (for example, hospitality industry) as well as for the transport and logistics industry. LDDK calls for the development of a complex support system for companies to provide energy resources for the entire economy, as well as financial resources to ensure the viability of companies and at the same time maintain their competitiveness.

The proposals of LDDK was not taken into account.

Views and reactions

No specific views to report.

Sectors and occupations

This case is not occupation-specific.

Sources

• 20 September 2022: Energoietilpīgiem apstrādes rūpniecības uzņēmumiem būs pieejams valsts atbalsts energoresursu izmaksu pieauguma kompensācijai (www.em.gov.lv)
• 13 April 2023: Law on Assistance for Mitigating the Economic Consequences Caused by the Sanctions and Countermeasures Imposed due to the Military Aggression of Russia against Ukraine (likumi.lv)
• 13 April 2023: Atbalsta energoietilpīgiem apstrādes rūpniecības komersantiem Krievijas militārās agresijas pret Ukrainu radīto seku uz ekonomiku mazināšanai īstenošanas noteikumi (tapportals.mk.gov.lv)
• 13 April 2023: LDDK komentāri (tapportals.mk.gov.lv)