29 January 2010 - Latvia has been granted approval by the European Union to provide financial assistance for a 400 MW plant intended to reduce the country's dependence on Russian gas.

Latvia, which is totally dependent on imports for its gas needs, will give a direct financial grant to the winner of a competitive tender, which will then be obliged to operate the 400 MW power plant for at least 6000 hours a year, reported Reuters.

The plant should feed on either gas from liquefied natural gas shipments or on solid fuel such as coal, lignite or peat mixed with at least 10 per cent biomass, the executive European Commission said.

"The EU has repeatedly recognised the exceptional circumstances of the electricity market in Latvia," Competition Commissioner Neelie Kroes said in a statement.

"I am satisfied that the new thermal power plant will contribute to the security of electricity supply in the Baltic region without unduly distorting competition," she added.