Operating segments

Generation and Trade

Generation of electricity and thermal energy, electricity and natural gas trade in the Baltic states, and administration of the mandatory electricity procurement process in Latvia.

Distribution 

The distribution service ensures the flow of electricity from the transmission network to consumers. Sadales tīkls AS is the country’s largest distribution system operator and covers approximately 99% of the territory of Latvia. Distribution system service tariffs are approved by the Public Utilities Commission (PUC). 

More information on Sadales tīkls AS webpage www.sadalestikls.lv.


On 10 June 2020, the former Latvenergo AS subsidiary Latvijas elektriskie tīkli AS which leased transmission system assets – 330 kV and 100 kV electricity transmission lines, substations and distribution points – to the transmission system operator, was separated from Latvenergo Group. The Latvian electricity transmission system assets, which were in possession of Latvijas elektriskie tīkli AS (330 kV and 110 kV power transmission lines, substations and distribution points), have been transferred to the state and it is further planned to invest them into the share capital of Augstsprieguma tīkls AS.

Facts

Data as of 31.12.2019


1939

Founded

3,423

Employees

6

Subsidiaries

4,880 GWh

Electricity output

1,842 GWh

Thermal energy output

42%

Generated from renewable energy


842 MEUR

Revenue

94 MEUR

Net profit

3,865 MEUR

Assets

229 MEUR

Investments

Baa2 (stable)

Credit rating


23%

Market share in the Baltics

757,000

Retail customers

6,505 GWh

Retail electricity supply

303 GWh

Retail natural gas supply

1,750 GWh

Thermal energy sold


2,591 MW

Installed electrical capacity

92,958 km

Length of distribution lines

5,922 MVA

Transformer capacity

1,838 MW

Installed thermal capacity

5,424 km

Length of transmission lines

9,339 MVA

Transmission Transformer Capacity

Mission. Vision. Strategy

Mission

To ensure high-quality, safe and environmentally friendly energy generation and supply to customers sustainably, thus promoting an increase in the long-term value of the Group.

Vision

To be one of the leading and primary customer-chosen providers of sustainable and high-quality power supply services in the Baltic markets.

Values

  • Responsibility
    We are reliable.
  • Efficiency
    We strive for excellence.
  • Openness
    We are transperent and open to new ideas.

Latvenergo Group strategy for 2017–2022 aims to further strengthen the Latvenergo Group position in the Baltics, with possible development towards the Nordic countries. Creation of new products and services plays a significant role in the achievement of these goals, promoting the interaction of generation and trading in line with the trends of the energy industry. 

Energy industry faces changes at both regional and global level, triggered by new technologies and user requirements. Therefore, energy companies extend and review the scope of their operations, offering new approaches and services, and acquiring new markets.

Changes in the industry are also relevant for Latvian national economy: new possibilities have been created by cross-border electricity interconnections, smart services are entering the day-to-day consumption, network digitalisation is ongoing, and new energy markets are opened. During the development of the next period strategy, account was taken not only of these, but also other factors affecting the Group's business environment at both national and international level.

Among the key strategic choices defined, priority is assigned to sustainable development in all areas of operation. This is justified by the goals reached during the previous strategy period and the evaluation of political, economic, social and technological factors. The sustainability position is complemented by new product and service offers in the existing market, and extension of operations outside the home market (under certain conditions). Operational goals of Latvenergo Group for 2017–2022 were set based on the above strategic choices.


Trade

Strengthen a sustainable and economically sound market position in home markets, at the same time considering geographical and/or of product/service expansion.

  • Operational excellence and cost-effectiveness;
  • Starting of retail gas trading;
  • Energy efficiency products as a business opportunity.

Under certain conditions, possibly also:

  • Geographic expansion to Nordic electricity markets;
  • Improvement of thermal energy trading,
  • Promotion of energy substitution projects (e.g., electro mobility, gas substitution with electricity in households).

Generation

Develop a generation portfolio adequate for synergies with trading and increasing the Group's value.

  • Complete the reconstruction of Daugava HPP generation facilities for sustainable and reliable operation;
  • Building of a gas procurement portfolio subordinated to the requirements of the electricity market;
  • Diversification of  the Group’s generation capacity and development of new ones.

Networks

Develop a functional, reliable and efficient network corresponding to customer needs.

 

  • Increase the efficiency of the distribution network;
  • Improve the quality of the distribution service;
  • Digitalise the distribution network;
  • Achievement of the transmission asset lease targets. 

Dividend Policy

Share of profit paid as dividends  > 80%

Profitability

Return on equity  >6%

Capital Structure

Net debt to equity  < 50%

Net debt to EBITDA < 3 

Organisational structure and governance

Latvenergo Group comprises the parent company Latvenergo AS and six subsidiaries. Latvenergo AS ensures generation and trade of electricity and thermal energy as well as trade of natural gas. Latvijas elektriskie tīkli AS manages transmission system assets, while Sadales tīkls AS ensures electricity distribution to each customer. Elektrum Eesti OÜ and Elektrum Lietuva UAB conduct electricity trade in Estonia and Lithuania respectively. Enerģijas publiskais tirgotājs AS carries out administration of electricity mandatory procurement.  

Liepājas enerģija SIA (51% of shares) ensures generation, transmission, distribution and supply of thermal energy in the city of Liepaja as well as generation of electricity in cogeneration mode. Latvenergo AS also holds 46.3% of the shares in the closed pension fund Pirmais Slēgtais Pensiju Fonds AS, as well as 0.005% of the shares in Rīgas siltums AS.

For more information about the governance of Latvenergo Group, see section  Investors/Corporate governance..

The Management Board of Latvenergo AS

The Management Board of Latvenergo AS was elected  for a five-year term. Currently, the Management Board consists of four members: 

Āris Žīgurs

CHAIRMAN OF THE MANAGEMENT BOARD,
CHIEF EXECUTIVE OFFICER

Guntars Baļčūns

MEMBER OF THE MANAGEMENT BOARD,
CHIEF FINANCIAL OFFICER

Uldis Bariss

MEMBER OF THE MANAGEMENT BOARD,
CHIEF COMMERCIAL OFFICER

Kaspars Cikmačs

Member of the Management Board, Chief Technology and Support Officer

The Supervisory Board of Latvenergo AS

The Supervisory Board of Latvenergo AS was elected at the Shareholders' Meeting of Latvenergo AS on 10 June 2020. The Supervisory Board is composed of five members: 

Ivars Golsts

CHAIRMAN OF THE SUPERVISORY
BOARD

Kaspars Rokens

DEPUTY CHAIRMAN OF THE SUPERVISORY BOARD

Toms Siliņš

MEMBER OF THE SUPERVISORY BOARD

Aigars Laizāns

MEMBER OF THE SUPERVISORY BOARD

Gundars Ruža

MEMBER OF THE SUPERVISORY BOARD

Awards



The most valuable company in Latvia for 12 years


For the twelfth time, Latvenergo AS received the award as the most valuable company in the TOP 101 Most Valuable Companies of Latvia.




Highest assessment in the history of the Sustainability Index

In 2019, at the closing ceremony of the Sustainability Index for the seventh year in a row Latvenergo AS has been awarded the Platinum (highest) category from the Sustainability Index and at the same time the highest assessment in the history of the Sustainability Index – 97.3%. Sadales tīkls AS, a subsidiary of the Group, was awarded the Platinum category for the first time. Both companies also obtained the status of a family-friendly company.





Three awards in the TOP 500 Companies of Latvia

In the TOP 500 Companies of Latvia, Latvenergo AS was recognised as the largest EBITDA maker, the largest state-owned company and the largest company in the energy sector.




The Most Attractive Employer


For the seventh time, Latvenergo AS was ranked as the TOP employer in the production sector and as the fourth most popular employer in Latvia in a survey by CV-Online Latvia. Sadales tīkls AS was ranked as the fifteenth most popular employer in this top. In 2019, in a study by Fontes, Latvenergo AS was recognised as one of the fairest remuneration payers.

History

1939

In October, the first Daugava hydropower plant – Ķegums HES was launched, while in December the Latvian State President and Prime Minister K. Ulmanis signed the Law on Establishing the State Electricity Enterprise “Ķegums”. Latvenergo Group considers this date as its birthday.

1955

To ensure centralized supply of thermal energy to Riga in the cold months, the Riga TEC-1 started operation. The 2nd phase was completed in 1959, achieving an electric capacity of 129 MW.‎

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