On Thursday, Lithuanian President Gitanas Nausėda and Prime Minister Ingrida Šimonyte discussed the situation in the electricity market and agreed that consumer protection is the state’s top priority, a spokesperson has said.
“During the meeting, it was agreed that the protection of Lithuanian consumers is currently the top priority of the state, and the government will in the coming weeks prepare a plan of measures to protect people’s interests in the energy price shock situation,” Ridas Jasiulionis, the president’s spokesperson, told BNS in a comment.
Electricity prices in the Lithuanian, Latvian, and Estonian price zones of the Nord Pool electricity exchange surged to record highs on Wednesday evening.
Read more: Lithuania to reach electricity price record on Wednesday evening, firms to reduce production
In addition, Perlas Energija, an independent electricity supplier, has recently announced that it is terminating fixed-price contracts for around 180,000 of its customers amid soaring electricity prices. On Thursday, the company said it is suspending its operations.
Perlas Energija said in a statement that it will continue to supply electricity to its customers until August 31, adding that they have until August 28 to choose a new supplier.
The company will be closed down after it sells its assets, pays compensations to customers, and settles up with its creditors and partners, it said, adding that its shareholders will not receive any assets or earnings after the closure.
Vilius Juraitis, CEO of Perlas Energija, said the decision was due to “a combination of factors”.
“First of all, as a result of our decision a week ago to move customers to the variable price plan, we have lost the trust of both customers and the responsible authorities, which means that attracting new customers in the near future would be impossible,” Juraitis said in the statement, noting that around 20,000 customers have already cancelled their contracts with the supplier.
“We may not be able to supply electricity to our remaining customers if we lose a large part of our existing customer base,” he added. “Thirdly, the creditors who have financed our operations so far are refusing to do so.”
According to Juraitis, Perlas Energija will compensate for the difference between the fixed-price contract price and the new supplier’s price. The company says it is now working with the Energy Ministry and the National Energy Regulatory Council (VERT) on the compensation scheme.
On August 5, Perlas Energija announced its decision to change contracts for all its customers and to move those on fixed-price electricity plans to the variable-price plan. The latter’s tariffs depend on the price of electricity on the electricity exchange.
Juraitis says the decision was made because electricity prices on the exchange have been steadily going up since the end of last year, making it impossible to offer fixed-price plans to customers.
In response to Perlas Energija’s move, Nausėda said last week that the legal sustainability of the liberalised electricity market had to be ensured and that he was waiting for Šimonytė to return from her vacation to discuss the situation.
Read more: After contract cancellation controversy, Lithuania delays electricity market liberalisation
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