At its meeting of 7 June 2022, the Cabinet of Ministers approved the first Recovery Fund support programme in Latvia, which will provide companies with access to financing for increasing energy efficiency and the wider use of renewable energy technologies.
Energy efficiency improvements or the use of alternative energy technologies require investment. However, at the moment, when both the geopolitical situation and the prices of all major energy sources show an exceptional and difficult-to-predict increase, it is high time to reconsider energy habits and invest in the sustainability of businesses. Therefore, in order to help our entrepreneurs to maintain competitiveness and boost productivity, we have prepared an aid programme for entrepreneurs that will promote independence from unpredictable fluctuations in energy prices and, at the same time, strengthen Latvia’s energy security. The Ministry of Economics is proposing the first aid programme within the Recovery Fund, and it will be available to a very wide range of entrepreneurs,” the Minister of Economics Ilze Indriksone indicates.
The aid will be available to businesses as a loan from the financial institution Altum or a parallel loan from Altum with a capital discount for the repayment of the principal amount – the maximum loan amount is 5 million euro with a loan maturity of up to 20 years. The aid will be granted as a capital discount or the financial institution Altum will reduce the amount of the loan by 30%, but not more than by 1.5 million euro, after the project is implemented and the target indicators are reached.
Zane Petre, Head of the European Commission Representation in Latvia, emphasises: “In today’s circumstances, it is particularly important to strengthen the energy security and efficiency of Latvia and the European Union. The business energy efficiency support programme approved by the government will enable many Latvian entrepreneurs to reduce their energy consumption, gradually abandon fossil energy and switch to the use of cleaner and safer energy. Let us remember that the best energy is the one that is saved and never consumed! The new programme is one of the first developed within the framework of the Recovery and Resilience Facility Plan for Latvia. Within the programme, projects of businesses will be able to obtain loans and capital discounts to “green” their economic activities, increase sustainability and reduce their ecological footprint. Throughout the project implementation cycle, entrepreneurs will have to respect the “do not cause significant environmental damage” principle, ensuring the sustainability of their projects.”
Companies will be able to receive the loan for the performance of reconstruction or renovation works that increase the energy efficiency of non-residential buildings, as well as the purchase of energy-efficient production and ancillary equipment to replace existing, less energy-efficient equipment. It is also envisaged that funding may be invested in the renovation, reconstruction or creation of building engineering systems, the recovery of secondary energy sources from technological production processes, as well as the deployment of renewable energy technologies such as solar panels, wind generators, biomass and other technologies.
The funding available from the Recovery Fund within the programme is 80.5 million euro, where 30.58 million euro are intended for the implementation of energy efficiency improvement measures and 50 million euro – for the transition to renewable energy technologies.