Lithuania's heating compensation could be short by at least €20 million this winter

Lithuanian municipalities could run short of at least €20 million for heating compensation in the cold season that has just begun, a representative of the Ministry of Social Security and Labour said on Friday, 6 November, as quoted by the BNS news agency and public broadcaster LRT. "We are already hearing that gas prices will rise further," she said, adding that if the winter is cold, total needs could reach €105 million.

The numbers. According to the ministry, about 151,000 applications for heating cost compensation were filed in September and October, 4.8% more than a year earlier, when there were about 144,100. The ministry had previously forecast about 170,600 recipients this season and needs of more than €80 million. Last season, compensation went to an average of about 164,600 people a month, who received a total of €69 million. In the evening, LRT reported that the €94 million earmarked might prove insufficient, and the minister acknowledged she might ask the Ministry of Finance for additional money.

Why costs are rising. Since 1 January, the reduced 9% VAT rate on district heating, hot water and firewood has been scrapped, which made heat about 12% more expensive, and the National Energy Regulatory Council (VERT) estimated that heat would cost 13–25% more this season. According to VERT calculations cited by LRT, residents of an old 60 m² flat will pay about €83, those in a renovated one €48 and those in a new building about €24. In November, the price of heat rises by more than a third compared with October in Vilnius, by about 12% in Kaunas and by about 10% in Panevėžys, while it falls in Šiauliai.

Background. The heat suppliers' association says biofuel remains expensive even though the state forest company has put additional volumes on the market, and LRT notes that gas prices have reached their highest level since 2022. Compensation is granted regardless of the heating method, so people who heat with wood are also eligible. In Vilnius, the municipality had received 20,700 applications by 25 October, 3% fewer than in the same period last year.

What comes next. The ministry says the total amount needed is still being calculated on the basis of data submitted by municipalities, and the minister has given assurances that low-income households will not be left without support.

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