Riga, January 13, 2021 – This week the Cabinet will review the information report “On the implementation of the Modernisation Fund” prepared by the Ministry of Environmental Protection and Regional Development, which is a new financial instrument to support investment in Latvia's progress towards climate policy objectives.
The report identifies as potential investment lines the modernisation of energy systems, increasing energy efficiency and promoting a fair transition. By 1 July 2021, it is necessary to develop the provisions of the multiannual operational programme of the Modernisation Fund, taking into account the measures specified in the Latvian National Energy and Climate Plan for 2021-2030.
The Modernisation Fund is a new financing mechanism aimed at supporting low-carbon investment by supporting national progress towards climate neutrality. . The financing of the modernisation fund is available in EU Member States where gross domestic product per capita at market prices in 2013 did not reach 60% of the EU average, so that the funds of the Modernisation Fund will be available to ten EU Member States - Bulgaria, Romania, the Czech Republic, Estonia, Croatia, Latvia, Lithuania, Hungary, Poland and Slovakia.
The financing of the “earmarked” Modernisation Fund for Latvia will total 100-120 million over the period. euro (the amount of funding depends on the price of emission allowances). Funding will not be available immediately as the monetization of emission allowances takes place gradually, with the same amount auctioned each year s.
In Latvia, the majority of greenhouse gas emissions come from energy and industrial processes, the transport sector, agriculture and waste management, reaching 82% of all GHG emissions (2017), including: 29% in the transport sector and 25% in the agricultural sector. The information report therefore proposes to focus the Modernisation Fund on investment addressing the GHG emissions challenges of the non-ETS sector. The identification and implementation of the measures to meet the 2030 climate targets will be carried out in synergy with the measures approved by the Latvian National Energy and Climate Plan for 2021-2030.
The Ministry managing the Modernisation Fund will be determined at national level for the power to develop, together with the Ministry of Economics, the rules for the operation of the multiannual programme of the Modernisation Fund, including . define the requirements for applicants and the responsible authority for the management of funding (investment function).
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Ministry of Environmental Protection and Regional Development
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