In its audit interim report “Untapped Opportunities in Housing Insulation,” the State Audit Office (SAO) noted that the main challenges in improving the energy efficiency of apartment buildings in Latvia are currently rising construction costs and insufficient funding for building renovations.
Previously, energy efficiency improvement measures were hampered by residents’ passivity, but today the more pressing issues are financing availability and costs. The interim report, prepared as part of the SAO’s performance audit “Do Investments in Heating and Building Energy Efficiency Ensure Sustainable and Economically Justified Heating?” emphasizes that Latvia relies mainly on European Union funds for improving energy efficiency in multi-apartment buildings, but these are insufficient to achieve the targets set in the National Energy and Climate Plan 2021–2030.
Latvia has approximately 39,000 multi-apartment residential buildings, about half of which were built during the Soviet era. The Ministry of Economics (MoE) estimates that economically justifiable renovations should cover most of these buildings—around 26,000. According to SAO calculations, renovating all residential buildings in Latvia by 2050 would require more than €20 billion.
“The audit findings confirm that promoting building energy efficiency is not a process that can be implemented in a short period, as it requires significant investments that cannot be placed solely on the residents. It is essential that this becomes a continuous, state-level goal, as timely investments in building maintenance and energy efficiency improvements will help reduce costs and save billions in the long term,” emphasizes Raivis Bremšmits, State Secretary of the Ministry of Economics.
The SAO’s interim report also found that professional project management from the very first stages of building renovations is critical, which aligns with MoE’s conclusions. As a result, legislative changes have been adopted in the Saeima (effective from 01.01.2026) to strengthen the role of the building manager as the representative of the homeowners’ association and to enhance project management capacity and expertise.
The audit provides recommendations to limit cost increases, use existing funding more efficiently, and increase support available for renovation measures. The MoE has already implemented a range of informational initiatives and improved support conditions, which has led to very high interest in the latest multi-apartment building energy efficiency program. These measures have enhanced understanding among all stakeholders—municipalities, building managers, and homeowners’ associations—about the importance of energy efficiency.
When designing the 2021–2027 EU fund support program, the MoE considered lessons learned from previous programs, expert recommendations, and feedback from involved institutions. As a result, in 2025, the ALTUM housing renovation program’s available funding of €173 million was fully reserved in less than one and a half months. The program’s “one-stop agency,” ALTUM, ensures both access to loans with capital discounts and active commercial bank involvement to secure the best terms for project implementation. This multi-apartment building energy efficiency support program has dispelled myths about public passivity or lack of interest in renovating their buildings and demonstrated that applying for support is not complicated.
The MoE thanks the State Audit Office for its interim report, which was prepared at a time of significant policy planning processes—implementation of the Social Climate Fund, reassessment of Modernization Fund priorities, and preparation of priorities for the next EU multiannual financial framework. The report provides timely and practically applicable recommendations for planning and implementing building energy efficiency measures. The survey responses, data analysis, findings, and recommendations in the SAO report offer an additional perspective on multi-apartment building energy efficiency and past support. These recommendations will be a valuable aid in planning future support, both financial and regulatory.
Currently, the MoE, in cooperation with the Ministry of Climate and Energy, is working to continue promoting investments in building energy efficiency using Social Climate Fund resources. The Fund aims to provide financial support to vulnerable residents who may face financial difficulties due to the European Union’s green transition policies.