Briefly about Us
Latvijas elektriskie tīkli AS (LET) is a subsidiary of Latvenergo AS that provides monitoring and management of Latvian power transmission network assets, as well as fund raising for the maintenance of existing transmission networks and the construction of new ones. Latvenergo AS is the shareholder of LET. In turn, all the shares of Latvenergo AS are owned by the state and are held by the Ministry of Economics of the Republic of Latvia, the interests of which at the Shareholders’ Meeting are represented by the State Secretary of the Ministry of Economics.
LET was registered in the Commercial Register of the Republic of Latvia on 10 February 2011, therefore this date is considered to be the date of foundation of Latvijas elektriskie tīkli AS.
LET has implemented and certified the Quality Management System in accordance with the requirements of standard ISO 9001. The system was initially certified in 2011, but in 2017 LET switched to the new version of the standard and the system was certified according to version ISO 9001:2015.
The ISO 9001:2015 compliance certificate awarded to the company provides assurance to our customers that the company takes care of the quality of its services. Periodic independent audits attest to the compliance of the system with the requirements laid down in the standard.
The company can be proud of its competent and professional employees who are capable of ensuring efficient operation, providing our customers with high quality services.
The Quality Management System of LET was implemented in line with the requirements of standard ISO 9001:2008 in 2011. In 2017, a periodic transition audit was carried out and the Quality Management System of LET was certified according to version ISO 9001:2015.
The ISO 9001:2015 compliance certificate demonstrates the high-level functioning of the management and control system. It provides the customer with the assurance that the company takes care of the quality of its services, maintaining a quality management system, periodically undergoing independent audits and certifying the efficiency of the system with the certificate. This certificate also confirms that the company employs competent and professional personnel, operating in accordance with the specific quality management procedures developed.
The fundamental principles of the management system are defined in the Quality Policy of Latvijas elektriskie tīkli AS. AS „Latvijas elektriskie tīkli” kvalitātes politikā (in latvian).
In accordance with the Energy Law of the Republic of Latvia, the Electricity Market Law of the Republic of Latvia and the Network Code, the main tasks of Latvijas elektriskie tīkli AS (LET) are to perform the functions of the owner of the power transmission system assets. LET owns the transmission system assets (transmission networks of the power system and related equipment) and, according to the instructions of the TSO, its task is to provide funding for investment in transmission assets and their lease to the TSO. LET ensures the management of the power transmission assets.
The guidelines for the transmission asset lease segment established in the Latvenergo Group Medium-Term Operational Strategy are included in the basic orientations for the strategic development of LET for the period from 1 January 2017 to 31 December 2022.
Ensuring sustainable funding for the development of power transmission networks.
The most optimum and efficient provider of funding for the activities of the independent transmission system operator.
Ensuring effective return on assets.
Performing the functions of the owner of the power transmission system assets, funding for investment in transmission assets and lease of transmission assets.
ACCOUNTABILITY. We can be relied upon!
EFFICIENCY. We are moving towards excellence!
OPENNESS. We are open and receptive to new ideas!
Overall Strategic Objectives
The objective of the European Union (EU) energy policy is the security of energy supply and formation of an efficient internal electricity market. The Third Energy Package was adopted in 2009. Directive 2009/72/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in electricity and repealing Directive 2003/54/EC aims at further separation of electricity trade and production from activities related to the power transmission system. Therefore, an operational model of the TSO’s ownership unbundling, which is in line with the Directive, has also been introduced in Latvia.
Choosing the optimum operating model and its implementation possibilities, the Cabinet of Ministers of the Republic of Latvia has assessed the criteria related to:
a) the continuity of the TSO’s functions;
b) the compliance with the requirements laid down in Section 201of the Energy Law regarding the preservation of the ownership of the transmission assets at Latvenergo AS and the prohibition on disposing of the shares of Latvenergo AS;
c) the least possible negative financial impact on Latvenergo AS, the state budget and tariffs.
Operational objectives for 2017 – 2022
- Funding of investment in the transmission system assets
Funding of investment projects related to the transmission system assets, including projects co-financed by the EU:
- the third Estonia – Latvia 330 kV interconnection;
- Kurzeme Ring, 330 kV Ventspils – Tume – Riga connection;
- 330 kV electricity transmission line Tartu – Valmiera to increase the available throughput;
- 330 kV electricity transmission line Tsirguliina – Valmiera to increase the available throughput;
- construction of the electricity transmission line Riga CHPP-2 – Riga HPP.
- Economically justified value of the transmission system assets
The regulated asset base preserved as a result of financial investment. Economically justified rental payment calculation.
- Fulfilment of the objectives related to the lease of transmission system assets operating segment
An economically neutral solution in the event of adopting a decision to change the TSO’s independence model.
Financial targets for 2017 – 2022
In order to achieve the strategic objectives, it is essential to ensure financial management and use an investment project funding programme. Setting financial targets is an important strategic planning tool. The financial targets set by LET for the period until 2022 are based on several ratios:
a) profitability ratio: return on equity (ROE), which is calculated as profit divided by the value of equity;b) capital structure ratios:
- liabilities ratio, which is calculated as a ratio of net debt/earnings before depreciation, financial costs and income tax (EBITDA);
- debt capital share ratio, which is calculated as a ratio of net debt/(net debt + equity) (Gearing);
c) dividend ratio: dividend pay-out ratio.
There have been 8 employees in Latvijas elektriskie tīkli AS since April 2018.
Remuneration policy principles are designed to maintain a motivating and competitive salary, while using financial resources rationally. The main basic principles of the remuneration policy:
- employee remuneration depends on the employee’s qualifications, experience, abilities, attitude and contribution to achieving the objectives of the capital company;
- personal goals/objectives of the employees are linked to the objectives of the capital company;
- employee remuneration is established and maintained so as to balance the remuneration of employees with the remuneration level in the labour market.
Corporate Social Responsibility
In accordance with the restriction set out in the Law on Prevention of Squandering of the Financial Resources and Property of a Public Person, Latvijas elektriskie tīkli AS does not make contributions / donations of financial resources and property.