Financing

There are several financial sources available in Latvia for building renovation, the most popular of which being the European Regional Development Fund (ERDF), the Climate Change Finance Facility (CCFF), and others. With the end of this European financing period and a new one not yet beginning, there will be a noticeable lack of financing in the coming years. However, this does not mean that energy efficiency events won’t continue to happen in Latvia.  Though it has yet to gain popularity in Latvia, SIA Citrus Solutions offers the ESCO financing model that has been widely used in the developed world since the 1980s.  ESCO is short for energy service company or energy savings company, though in a broader sense, it means that the energy consumer does not use his own finances and resources for improving energy efficiency, but instead allows an ESCO company to do this. The ESCO company uses its own resources to perform all necessary measures to increase energy efficiency, and the energy consumer continues to pay the same amount for energy to the ESCO company that he paid prior to the improvements for the next 2-7 years, while the ESCO company covers its invested expenses with the saved energy costs during the 2-7 year period. After the end of this period, all savings transfer to the energy consumer. In the case of the ESCO model, all responsibility for successful project results is assumed by the ESCO company. The value of such projects can usually be measured beginning with 100,000 EUR.

The price of electricity has increased by 94% during the time period from 2006 to 2011, while the price of heat has increased by 76% (according to data of the Central Statistical Bureau). When developing projects, we also anticipate rises in energy costs and other influencing factors.