The decision to title the energy transition strategy approved by the Seimas [Lithuanian parliament] in June as an “energy independence” plan is a clear statement of intent. Could you outline the thinking that led up to the creation of this document and the assumptions behind the target of having 45% of total electricity coming from renewable energy sources by the end of the next decade, rising to supply 80% of total energy consumption by 2050.
This new strategy was adopted after six years of discussion and debate, replacing our previous one from 2012, and so extends our energy security agenda, but also aligns to our key ambition of greater [domestic] power production and shows our dedication to renewable energy, whether wind, solar or biomass, to, practically, 2030, and by some guidelines, through to 2050. And it was a good sign that it was approved almost unanimously in our parliament.
Next year we are moving forward to having our first technology-neutral tenders to support the 520MW of wind we now have in installed capacity and build on the 90MW of solar. Biomass remains the main source of power for our district heating systems, where we are now at almost 70% of our capacity [with remaining 30% gas].
Our target is to increase renewables by 2.5 times by 2030. This will be a major shift. We have already achieved our 2020 targets [in line with EU commitments to have] 26% of our final energy consumption from renewables. But we are not stopping here. We are moving forward not to bring on more renewables, but more indigenous energy production.
This is our key message to investors: clear and constant progress in our energy transition. Currently we have 11TWh of [annual] demand. When we meet these [2030] targets we will have almost 5TWh coming from wind power alone; by 2050 we would hope to have almost all generation from renewable sources.
All the EU countries are moving towards having independence from fossil fuels. For us, in Lithuania – by happy coincidence on the 100th anniversary of declaration of independence as a country – also signals our desire for independence from our traditional main energy supplier – Russia – and one-source gas pricing. So ‘energy independence’ is also an important term of our society, to have the ‘choice’ to choose our energy sources freely.
You said at the time that the energy strategy was “progressive and ambitious not only in the regional context, but in the pan-European context as well.” Could you explain why you feel this to be the case and how [European transmission system operator body] Entso-e’s decision last month to expand the synchronous grid in continental Europe to the Baltic States will change Lithuania’s role in the EU energy transmission system.
This is another practical example of how we are gaining greater independence. Today we are in a joint network together with the other Baltic states [Estonia and Latvia] in operation with Russia and Belarus – which is a legacy from the Soviet Union from the so-called Brell link set up after 1945.
We have never experienced independent operation of our electricity transmission system before now. This was a long road.
So, we have never experienced independent operation of our electricity transmission system before now. This was a long road – we started this project more than ten years ago and it was, to be a clear, a geopolitical project as well as an infrastructure project – but we have moved it from the political agenda to the technical agenda, and now with the support of the European Commission we have finalised ‘how’ it shall be done – using the existing LitPol link and a new undersea 700MW DC power cable between Lithuania and Poland.
And so this is not only again allowing our energy system to be independent from the Russian system, but also to have easier achievement of integrating offshore wind power in the Baltic Sea [into the Lithuanian grid].
That Entso-e has been participating in making all the necessary calculations [for the Baltic States to join Europe’s synchronous grid] means we can now can shift very rapidly into having our ‘catalogue of measures’ in the first quarter of next year. And this process makes it feasible to have full synchronisation from 2025.
How do you see the roles of [state utility] Lietuvos Energija and [national transmission system operator] LitGrid evolving with the transition to a renewables-led energy system in Lithuania?
Lietuvos Energija is responsible for domestic power production of course, and the major change we are seeing is that there were plans for a nuclear plant to be built next to Ignalina nuclear plant (decommissioned in 2009) that we have discontinued.
Now that the cost of renewables – wind and solar – is competitive [with conventional power sources] they are looking to gain experience in onshore and offshore wind and also to turn their thinking to include the potential for ‘added value’ to our economy through supply chain development.
And LitGrid will be newly responsible for not only the safety and security of the network but also the integration of greater and greater amounts of renewable energy onto the system.
How is the Lithuanian government on the potential for offshore wind power production in the Lithuanian Baltic – given the advances being seen off Sweden, Finland and soon Poland?
Offshore wind is very interesting to us naturally. We see the power production potential of course but also the wider economic development potential for a new supply chain for the projects to be built off the whole Baltic Sea coast – Latvia, Estonia, as well as Poland.
This future is coming really quite soon and we believe we can be well-placed to develop into logistics and manufacturing hub for these developments offshore. Many of our companies could be very competitive – we have examples of steel manufacturing facilities in [the Lithuania port] cities including Klaipeda that could build foundations for offshore wind turbine.
We are moving forward with investigations of the wind resource [offshore], the environmental impact issues, the market potential, and grid connectivity. There are ambitions for auctions for offshore wind in 2021/22. Beyond our national plans we are also looking at the possibility of projects on the regional scale. We are planning to have 500MW [of offshore wind] as a minimum starting point, in consideration of the limitation of grid connections.
The water depths are only around 30 metres and we know from our experience laying SwedLit [the interconnector between Lithuania and Sweden now renamed NordBalt] that our part of the seabed is quite sandy compared to other areas of the Baltic seabed are very rocky. So we have a ‘technologically friendly’ situation in this respect.
When you announced the energy independence strategy you underlined that the plan had public backing as well as that of the Seimas, and so could “safely be called a national agreement on energy”. We have seen many countries, the UK included, where ideology continues to trump energy economics and climate science. How would describe the awareness of – and perception of – industrial-scale renewables and the energy transition by the ‘average Lithuanian’?
One of the key elements of our energy strategy is the security and the diversified portfolio that will support this. This is the alpha and omega for us. And this is a ‘national agreement’, as you say. Large-scale renewables – wind, solar, biomass – is central to the strategy, but so is small-scale renewables, mainly residential PV.
We are targeting having [in capacity terms] almost as much rooftop PV as we were planning to have coming from nuclear [by 2030]. And we are promoting the idea of Lithuanians being ‘active consumers’ or ‘prosumers’ in the energy system. This would be a paradigmatic change for both the energy system and the individual consumer.
I think both the practical reality of this [decentralised system where consumers are not directly reliant on energy companies] and the historical [reality] insofar as it moves us further away from the post-Soviet era where every effort was dedicated to large-scale generation. A sustainable model is what we are targeting.
