The European Union Agency for the Cooperation of Energy Regulators (ACER) on April 1, 2026, published a proposal recommending modifications to Latvia's gas transmission tariff structure for the year 2026. The proposal, issued by ACER's Gas and Electricity Markets Department, is a formal opinion under EU energy regulations, aiming to align Latvia's tariff methodology with the EU's network codes and internal energy market rules. It includes specific recommendations on tariff calculation methods, such as capacity-based versus commodity-based charges, and calls for greater transparency in cost allocation.
ACER's proposal targets the current tariff design used by Latvia's transmission system operator, which the agency considers insufficiently cost-reflective and potentially distorting cross-border trade. The recommended changes would shift towards a more capacity-based model, reducing the weight of commodity charges. This follows the European Commission's 2025 Gas Decarbonisation Package, which urged member states to reform tariff structures to support renewable and low-carbon gas integration. The proposal also references the Council's April 2025 conclusions on energy security, which stressed the need for non-discriminatory network access.
increasing cost-reflectivity to ensure that tariffs better match actual infrastructure usage, and enhancing transparency in how transmission costs are allocated between domestic and transit flows. These changes aim to reduce cross-subsidisation between user groups and improve market signals for investment. However, the proposal acknowledges trade-offs: while more cost-reflective tariffs can improve efficiency and align with EU internal market rules, they may increase short-term costs for certain consumer groups, particularly small industrial users and households in Latvia, who could face higher fixed charges.
Impact on stakeholders For Latvia's national regulatory authority, the proposal implies a need to revise its tariff methodology and potentially adjust regulatory oversight. The transmission system operator would face administrative and technical costs to implement new tariff structures. Latvian gas consumers, especially industrial users, may experience moderate increases in transmission charges if capacity-based fees rise. Conversely, transit shippers and cross-border traders could benefit from reduced commodity charges and more predictable cost allocation, potentially boosting gas flows through Latvia's network.
Expected institutional follow-up ACER's proposal is non-binding but carries significant weight in EU energy governance. Latvia's regulatory authority is expected to respond within three months, either adopting the recommendations or providing a reasoned justification for deviation. The European Commission may subsequently issue a formal opinion or initiate infringement proceedings if the proposed changes are not implemented. The European Parliament's ITRE committee is also monitoring tariff reforms as part of its oversight of the Gas Decarbonisation Package.
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