How do you protect vulnerable households from high electricity prices without distorting the market or straining public finances? Lithuania's answer is to build the support directly into the regulated tariff — no separate benefit to apply for. A structural layer allocates the cheapest procurement volumes to vulnerable consumers, and a fiscal layer adds a government-funded per-kWh reduction on top, together cutting the price around 18% below standard supply.
The mechanism is largely self-financing, drawn from EU inframarginal-cap surplus revenues rather than the general budget. It's also refreshingly honest about its limits: only about 121,000 of 420,000 eligible consumers currently benefit — a reminder that automatic delivery removes friction but doesn't guarantee full take-up.
Read more in the latest Regulatory Story by ERRA prepared along with the National Energy Regulatory Council (NERC) of Lithuania by downloading the document below.
ERRA Regulatory Story No. 20: A Discount Built into the Tariff: How Lithuania Shields its Vulnerable Electricity Consumers