Lithuania looks to neighbours for power

14 October 2009

Lithuania has been negotiating electricity supply contracts with neighbouring countries to help cover supplies after the closure of the Ignalina nuclear power plant at the end of 2009.


Ignalina (INPP)
Closure of the Ignalina plant approaches (Image: INPP)
Lietuvos Energija has recently signed an electricity supply contract with Belorussian energy concern Belenergo. Under the contract, Belenergo will propose electricity volumes and prices for each subsequent week, while Lietuvos Energija will study the market situation and decide on how much electricity it will purchase from it on a week-by-week basis.


Edvardas Važgela, director of Lietuvos Energija's department of market administration, said, "We have secured a possibility of electricity supply from Nordic markets, Estonia, Latvia and now we successfully rounded up negotiations with a Belorussian energy company. Given the procurement possibilities of electricity from as many countries as possible, we will be ready to reliably provide Lithuania with powers upon closure of the nuclear power plant."


Lithuania's electricity demand in 2010 is expected to be some 9.1 billion kWh, half of which will be generated by Lithuania itself. Some 35% of demand will be covered by power purchased at market conditions from Estonia, Latvia, Scandinavia, Ukraine, Russia, Belarus and Lithuanian generators.


The closure of the two-unit, Soviet-era Ignalina nuclear power plant was a condition of Lithuania's accession to the European Union (EU). The EU has agreed to pay decommissioning costs and some compensation through to 2013. Unit 1 of the Ignalina plant was shut at the end of 2004. 

Replacement regional capacity


Lithuania has proposed building a new nuclear power plant to replace Ignalina, with the participation of neighbouring Poland, Estonia and Latvia. The two-unit plant would be built at Visaginas, near Ignalina, at a cost of some €6.7 billion ($10 billion). The first of the reactors, of up to 1700 MWe each, would come on line in 2018.


In what is seen as a competing project, Russia has proposed constructing a nuclear power plant in Kaliningrad on the Baltic coast to generate electricity for export, and with up to 49% European equity. The plant would comprise two 1200 MWe VVER units at Neman, close to the Lithuanian border and costing some €6 billion ($9 billion). Two thirds of the power would be exported to Germany, Poland and the Baltic states. Lithuania has been invited to participate in the project, instead of building Visaginas.


Belarus is also planning to construct its first nuclear power plant. Operation of the first of two 1200 MWe reactors at the plant is scheduled for 2016 and 2018. Power from the plant could be exported, including to Lithuania. Russia's AtomStroyExport has signed an agreement to assist in a feasibility study into the construction of the Belarus' first nuclear power plant. The feasibility study - which will look at the investment options available to finance the proposed plant - is to be completed by the end of 2009. An intergovernmental agreement between Russia and Belarus specifically on cooperation in the construction of a nuclear power plant in Belarus is expected to be signed this month.