The scheme applies to cogeneration and renewable energy plants built between 2007 and 2012, and is financed by a tax on all electricity users.
In a statement, the Commission said the support scheme promoted the deployment of cogeneration and renewable power and would help Latvia achieve its 2020 climate goals without creating undue market distortion.
To ensure that the scheme is not biased against foreign competition, Latvia has committed to investing in projects that favour integration with the European electricity market.
Cogeneration is steadily increasing in Latvia, with renewable energy playing a growing role in powering the CHP fleet. From January to November 2016 (last available figures), Latvian cogeneration plants generated 3 GWh, an increase of 7.4% on 2015 numbers.
And, although the majority of Latvia’s CHP fleet is still natural gas-fired, the use of biogas and wood fuel jumped from 6 MW in 2007 to 105 MW in 2013.
In 2015 Dr Fiona Riddoch, then-head of trade body COGEN Europe, called Latvia “an EU leader in terms of cogeneration deployment and support”.