The €1.3bn programme will be funded with the aid of €347m from the European Union Cohesion Fund, with implementation divided into three phases.

At present just 14% of the Latvian railway network is electrified, well below the EU average of 55%. The electrification programme will increase this figure to 59% by the mid-2020s.

Phase 1 will be implemented between 2019 and 2023 and involves electrification of the Rezekne – Krustpils – Ventspils and Daugavpils – Krustpils lines, creating an east-west electrified corridor through the centre of the country.

Between 2020 and 2025 phase 2 will extend the wires from Daugavpils to Indra on the border with Belarus, and from Krustpils to Aizkraukle, while the Aizkraukle – Šķirotava line will be converted from dc to ac. This will enable electrically-hauled freight trains from Belarus to reach the standard-gauge Rail Baltica freight terminal at Salaspils near Riga.

Phase 3 will be implemented between 2025 and 2030 and involves conversion of the remaining dc electrification around Riga to ac.

The business plan for the programme, which was developed by Ernst & Young Baltic, is based on a 30-year asset life-cycle with a 2023 commissioning date. With the rising cost of diesel, increasing freight traffic, and a large number of diesel locomotives due for replacement after 2020, electrification is deemed a cost-effective option for core routes.

LDZ anticipates the cost of freight transport will fall by €1 per tonne on electrified lines.