Europaudvalget 2015
KOM (2015) 0572
Offentligt
1577175_0001.png
EUROPEAN
COMMISSION
Brussels, 18.11.2015
SWD(2015) 231 final
COMMISSION STAFF WORKING DOCUMENT
Country Factsheet Lithuania
Accompanying the document
COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN
PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL
COMMITTEE, THE COMMITTEE OF THE REGIONS AND THE EUROPEAN
INVESTMENT BANK
State of the Energy Union
{COM(2015) 572}
{SWD(2015) 208 à 209}
{SWD(2015) 217 à 230}
{SWD(2015) 232 à 243}
EN
EN
kom (2015) 0572 - Ingen titel
1577175_0002.png
Towards an Energy Union
Lithuania
Macroeconomic relevance of energy
IMPORTANCE OF THE ENERGY SECTOR
At 2.8% of total gross value added in 2012, the share of the energy sector in Lithuania is considerably
higher than the EU average, but has decreased from 3.5% in 2005. In parallel, the share of
employment in the energy sector in total employment has decreased importantly (from 1.4% to 1%)
but is still nearly twice as high as the EU average (0.6% in 2012).
Value added of energy sector
% of
gross
value added (total economy)
4.0
1.6
Employment in energy sector
% of total employment
3.0
1.2
LT
2.0
LT
0.8
EU27
EU27
1.0
0.4
0.0
0.0
2005
2012
2005
2012
Source: EUROSTAT – National Accounts
According to EurObserv'ER, in 2013, the share
of direct and indirect renewable energy
related employment in total employment of
the economy in Lithuania was at about 0.41%,
below the EU average of 0.53%.
Source: European Commission, based on EurObserv'ER and
EUROSTAT
TRADE BALANCE OF ENERGY PRODUCTS
The energy trade balance of Lithuania is significantly negative and amounted to 6% of GDP in 2014.
The Lithuanian deficit is driven almost entirely by gas and oil import. Despite high dependence on
foreign energy products, Lithuania has greatly reduced its current account deficit over the past few
years. It went from a deficit of 10% of GDP in 2006 to a balanced current account in 2014. The
reduction was largely due to non-energy components, with energy trade deficit doubling to 6% of
GDP during the same period.
kom (2015) 0572 - Ingen titel
1577175_0003.png
Towards an Energy Union - Lithuania
Trade balance of energy product and current account
balance, 2006
2
0
Trade balance of energy product and current account
balance, 2014
2
0
-2
% of GDP
% of GDP
-2
-4
-6
-8
-4
-6
-8
-10
-12
LT
EU28
-10
-12
LT
EU28
Coal
Oil
Electricity
Gas
C. A. Balance
Coal
Oil
Electricity
Gas
C. A. Balance
Source: EUROSTAT
Note: Current account balance for EU28 from European Commission (AMECO)
1. Energy Security, solidarity and trust
ENERGY MIX
The energy mix of Lithuania differs from the one of the EU-28, with the notable difference of a much
higher share of gases and much lower of solid fuels. Compared to 1995, the share of nuclear has
decreased from 36% to 0%, due to the closure of the Ignalina nuclear power plant. Consequently, all
other energy sources increased in the share of gross inland energy consumption. The share of solid
fuels and petroleum and products increased (from 2% to 5% and from 35% to 40% respectively).
However, it is the share of renewable energy which experiences the most striking change, with a
sharp increase by 18 percentage points. The share of gases increased from 23% to 35% of the energy
mix.
Gross inland energy consumption in 2013
Source: European Commission, based on EUROSTAT
IMPORT DEPENDENCY
Import dependency
1
in Lithuania is higher than for the EU as a whole. Import dependency was in
2013 100% for gas and at very high levels for petroleum products. However, after the putting into
operation of the LNG Terminal in Klaipeda, Lithuania diversified its gas imports, although it still
imports most of its gas from Russia
2
. In addition, the country's dependency for solid fuels increased
in the last years. Supply concentration of other fuel sources is also very high, making Lithuania
1
2
Note: A dependency rate in excess of 100% indicates that energy products have been stocked.
Top non-EU gas suppliers table is based on EUROSTAT data. The share of imports from non-EU countries is calculated
as the ratio between volumes of imports from that specific non-EU supplier and total imports (from EU and non-EU
countries).
2
kom (2015) 0572 - Ingen titel
1577175_0004.png
Towards an Energy Union - Lithuania
vulnerable to external supply shocks. This also translates into a very large energy trade deficit, as
expressed in percentage of GDP. Lithuania remains highly dependent on electricity imports (64% in
2013), mainly (44 %) from the Russian Federation. In order to address this issue, Lithuania is being
considering a possibility to build a regional nuclear power plant together with other regional
partners.
Import dependency 2013
101%
92%
93%
87%
100%
Top non-EU gas suppliers in 2013 (% in total imports)
Lithuania
European Union
country
[%]
country
[%]
Russia
100.0
Russia
39.0
Norway
29.5
Algeria
9.7
Qatar
6.7
78%
82%
57%
2005
52%
2013
53%
2005
2013
2005
57%
2013
All fuels
Petroleum and
products
LT
EU28
Natural gas
Source: European Commission, based on EUROSTAT
2. A fully-integrated internal energy market
INTERCONNECTIONS
The interconnection capacity for electricity was 4% in 2014 for the three
Baltic States – Estonia, Latvia and Lithuania – taken as one entity. With
the start of operation of Estlink2, their level of interconnection
substantially increased to around 10%. Lithuania is not directly
connected to the European electricity grid
3
and therefore, answering to
the Commission's priority of ending the Baltic isolation, several projects
were listed as key infrastructure projects in the European Energy
Security Strategy (EESS). Interconnectors with Sweden and Poland, to be
completed in 2015, will foster security of supply and wholesale market
functioning. The three Baltic States agreed in the first quarter of 2015 on
a common strategic goal: de-synchronisation from IPS/UPS and the
synchronisation of their power systems with the Continental European
Network. The project of synchronisation is included as a key
infrastructure project in the European Energy Security Strategy, as well
as is highlighted as one of the key energy priority areas in Baltic Energy
Market Interconnection Plan (BEMIP).
The LNG terminal in Klaipeda, finished at the end of 2014, created
diversification of gas supply. However, to end the Baltic States‘ (and
Finland‘s) physical isolation from the European gas networks, the new
bi-directional gas pipeline between Poland and Lithuania (GIPL) is an
essential project mentioned also in the European Energy Security
Source: European Commission
based on ENTSO-E scenario
outlook and adequacy forecast
2014
Note: Reference to 2030
target is based on October
2014
European
Council
conclusions stating that "the
Commission will also report
regularly to the European
Council with the objective of
arriving at a 15% target by
2030"
3
The three Baltic States are interconnected with the European electricity network only via Finland at the moment.
3
65%
kom (2015) 0572 - Ingen titel
1577175_0005.png
Towards an Energy Union - Lithuania
Strategy. It will be the first gas interconnector of the Eastern-Baltic
region with the Continental European gas networks. The financing
agreement of the gas interconnection, signed on 15 October 2015, paves
the way for its successful implementation by the end of 2019.
ELECTRICITY AND GAS MARKETS
Market concentration index for power generation (left)
and gas supply (right) (2013)
(Herfindahl index – 10000
means monopoly)
Sources:ESTAT and European Commission Calculations
Sources: European Commission based on ESTAT, CEER and Platts
Power Vision
Concentration on power generation markets is slightly above EU average. The closure of the Ignalina
nuclear power plant in 2009 created opportunities for new suppliers on the market with the bulk of
the shortfall being replaced by imports from Russia. On the upstream gas market, until the opening
of the Klaipėda LNG terminal and the signing of an LNG supply contract with Statoil, Gazprom was
the only gas supplier to Lithuania and the whole Eastern-Baltic region.
Klaipėda LNG terminal
significantly enhanced security of natural gas supply for all consumers in the Baltic States by
providing an alternative gas supply source on the
basis of
full Third Party Access. Klaipėda LNG
terminal regasification capacities of 3.8 bcm/y (10.3 mcm/d) are sufficient to cover around 90% of all
current demand of the Baltic States.
Electricity and gas wholesale prices are above EU average. Regarding gas prices, the diversification of
import sources via the new LNG terminal has positive impacts on prices.
The gas market is 100% liberalised and customers are free to choose among gas suppliers, however
during 2013 only modest interest in switching was observed. Changing electricity supplier in
Lithuania was permitted but during 2013 no switches were made. According to an EU-wide survey
4
,
consumers' satisfaction regarding both the electricity and the gas retail markets is well above the EU
average.
Natural gas smart metering is planned to be installed in Lithuania, starting with a pilot project for
large customers. In parallel, in the electricity sector a pilot project of smart meters is initiated too.
CONTRIBUTION OF ENERGY TO CONSUMER PRICE EVOLUTION
Inflation of consumer prices has decreased importantly in Lithuania compared to the pre-crisis
period. Past volatility in inflation was largely due to non-energy items, although energy played a
significant role in 2010-11. As in the rest of the Euro area, oil prices have declined in 2014, driving
overall inflation at historically low levels.
4
10th Consumer Markets Scoreboard (June 2014),
http://ec.europa.eu/consumers/consumer_evidence/consumer_scoreboards/10_edition/index_en.htm
4
kom (2015) 0572 - Ingen titel
1577175_0006.png
Towards an Energy Union - Lithuania
15
Lithuania : Price evolution & the contribution
of energy prices
% increase on a year earlier
4
3
2
1
0
-1
EA : Price evolution & the contribution of
energy prices
% increase on a year earlier
10
5
0
-5
2005
2007
2009
2011
2013
2005
2007
2009
2011
2013
Non Energy
Energy
All items
Non Energy
Energy
All items
Source: DG ECFIN based on Eurostat
VULNERABLE CONSUMERS
According to a EUROSTAT survey, the three
proxy indicators related to fuel poverty indicate
an acute issue in Lithuania, in particular as
regards the ability to keep home adequately
warm. However, Lithuania has put in place an
adequate legislative framework for the
protection of vulnerable consumers.
Source: European Commission, based on on EUROSTAT SILC survey
3. Energy Efficiency and moderation of energy demand
ENERGY EFFICIENCY TARGET 2020
(6.5 Mtoe primary energy and 4.2 Mtoe final energy)
Lithuania’s 2020 energy efficiency target is 6.49
Mtoe expressed in primary energy consumption
(4.28 Mtoe expressed in final energy
consumption). When comparing the trend of
primary energy consumption with the GDP
development over the past decades, it can be seen
that there is evidence of a decoupling of both.
Even if Lithuania’s current primary energy
consumption (5.7 Mtoe in 2013) is below its 2020
target, it could continue its current efforts
regarding energy efficiency to keep the primary
energy consumption at this level or increase it only
slightly so that it will reach its 2020 target even if
the economy continues to grow in the next five
years.
Source: European Commission, based on EUROSTAT and on
national energy efficiency targets as declared by the MS under the
EED
ENERGY INTENSITY
Overall energy efficiency indicators and trends are still above EU averages. Energy intensity is higher
in the overall economy and the major sectors, i.e. industry, buildings and transport. However,
primary energy intensity in Lithuania has significantly decreased since 2005, although it remains well
above the EU average. A high energy intensity reduction is also recorded in the industrial sector,
although here again it remains above EU average.
5
kom (2015) 0572 - Ingen titel
1577175_0007.png
Towards an Energy Union - Lithuania
Primary energy intensity of the economy
Final energy intensity in industry
Source: European Commission based on EUROSTAT
Source: European Commission based on EUROSTAT and European
Commission/AMECO
Specific energy consumption by households is above EU average and decreased at a slightly slower
pace than the EU average. This could mean that there remains untapped potential to improve energy
efificiency in the residential sector. The indicator used below shows that the energy intensity of
transport is below EU average. This is however difficult to interpret as Lithuania has one of the most
inefficient car fleet in Europe. The average age of passenger cars is around 14 to 15 years and the
emission levels of newly registered cars are among the highest in the EU (140 g CO
2
/km against an EU
average of 127 g CO
2
/km). There is no car taxation in place and taxes on transport fuel are among the
lowest in the EU.
Final energy consumption per m2 in
residential sector, climate corrected
Specific energy intensity for passenger cars and freight
transport
5
Source: European Commission based on Odyssee
database
Source: PRIMES model background data and estimations based on EU
Commission and EU MS inputs
EU legislation sets mandatory CO
2
emission reduction targets for new cars and vans. By 2021, the
fleet average to be achieved by all new cars is 95 grams of CO
2
per kilometre. For new vans, the fleet
average is set at 147 g/km by 2020.
5
Statistics on energy demand for passengers and freight transport are not available and model estimates have been
used instead. These issues should be borne in mind when comparing energy intensity in freight or passenger transport
between Member States, which should be regarded as merely indicative.
6
kom (2015) 0572 - Ingen titel
1577175_0008.png
Towards an Energy Union - Lithuania
Source: European Environmental Agency. 2014 values are provisional. 2013 EU average refers to EU-27
Regarding transport performance, in EU-28 the inland freight modal shares are 71% by road, 17% by
rail, 7% by inland waterways and 5% by pipelines. The respective inland passenger modal shares are
82% by private car, 9% by buses and coaches, 7% by railways and 2% by tram and metro. In Lithuania,
as in the other Baltic States, rail is widely used in freight transport. However, passenger transport is
mostly performed by road.
Modal shares Lithuania
Source: Eurostat and EU transport in figures 2015. Data refers to 2013. Modal shares based on tonne-kilometres for freight sector and
passenger-kilometres for passenger sector, freight data based on activity within country territory. Estimates are made when data is missing.
4. Decarbonisation of the economy
NON-ETS GHG EMISSION REDUCTION TARGET 2020
(+15% by 2020 as compared to 2005 in the non-ETS sector)
Lithuania has decreased its emissions by 5%
between 2005 and 2014 (based on 2014
approximated data). According to its 2015
projections, Lithuania is on track to reach
its 2020 target, with a 18% margin as
compared to 2005.
Non-ETS Emissions
(vs. 2005)
Source: European Commission
inventory data.
based on EEA. Based on preliminary
Projections/proxy
target
Projections with
existing measures
2020
Proxy 2014
-3%
-5%
+15%
-1%
ESD (Effort Sharing Decision) emissions are the emissions from sectors not
covered by the EU ETS.
RENEWABLE ENERGY SHARE TARGET 2020 (23%)
7
kom (2015) 0572 - Ingen titel
1577175_0009.png
Towards an Energy Union - Lithuania
In 2013, Lithuania had a renewable energy
share of 23%. This corresponds to its 2020
target.
Source: European Commission based on EUROSTAT
GREENHOUSE GAS EMISSION INDICATORS
In Lithuania the Agriculture sector is the largest in terms of share of total emissions, with a
value that is twice the EU average
Lithuania has one of the highest carbon intensity of the economy in the EU, about 80%
higher than EU average.
In 2014, Lithuania reinvested all the revenues from the auctioning of ETS allowances
(EUR 17.3 million) to improve energy efficiency of buildings and for installation of renewable
energy resources in public and private buildings.
GHG Emissions
EU ETS auctioning
revenues in 2014 (EUR
millions)
Share of ETS emissions
in 2013
GHG emissions/capita
in 2013
(tCO
2
equivalent)
Carbon intensity of the
economy in 2013
(tCO
2
equivalent/EUR
millions
Lithuania
17,3
EU
3205
Largest Sectors of GHG
Emissions in 2012 (*)
Energy/power industry
Transport
Industry
Agriculture (incl. forestry &
fishery)
Residential & Commercial
Waste & others
Lithuania
22%
21%
23%
24%
6%
4%
EU
Average
33%
20%
19%
12%
13%
3%
38%
42%
6.6
8.5
618
328
Source: European Commission based on EEA
(*)Sectoral breakdown for 2013 data not available
ENERGY & TRANSPORT TAXATION
Energy and transport related taxes as a share of GDP are below the EU-average, largely due to lower
receipts from taxation of vehicles and of heat and electricity. The overall tax burden has declined
since 2005.
8
kom (2015) 0572 - Ingen titel
1577175_0010.png
Towards an Energy Union - Lithuania
Energy & Transport related taxes
% of GDP, 2005
3.0
3.0
Energy & Transport related taxes
% of GDP, 2012
2.0
Transport
vehicles
Transport fuel
2.0
Transport
vehicles
Transport fuel
1.0
Heat &
Electricity
1.0
Heat &
Electricity
0.0
LT
Source: Eurostat
0.0
EU-28
LT
EU-28
5. Research, innovation and competitiveness
RESEARCH AND INNOVATION
Lithuania is below the EU average, above the US and below Japan and South Korea in terms of public
support share allocated to research and innovation in the field of energy and environment. In terms
of intensity of low-carbon technologies patents, Lithuania is much behind the EU average and main
worldwide partners.
Source: European Commission based on EUROSTAT
COMPETITIVENESS
The real unit energy costs
6
are more than three
Real unit energy costs (% of value added)
times higher in Lithuania than in the EU. This
reflects that the energy intensity
7
of Lithuania's
manufacturing sector is higher than both the
EU's and in the US, and that real energy prices
have increased in Lithuania over the past ten
years.
Being in line with the EU average, electricity and
gas prices for industrial consumers remain higher
than in the US and other major non-EU trading
partners.
6
7
This indicator measures the amount of money spent on energy sources needed to obtain one unit of value added.
The energy intensity presented here is derived from Use Tables of WIOD, see "Energy Economic Developments in
Europe SWD(2014)19".
9
kom (2015) 0572 - Ingen titel
1577175_0011.png
Towards an Energy Union - Lithuania
60
50
48.2 48.2
35.3
40
30
20
10
0
9.5
13.2 13.7
8.2
8.8
8.0
LT
2000
EU27
2009
2011
US
Source: European Commission
Source: European Commission based on EUROSTAT and IEA
10
kom (2015) 0572 - Ingen titel
1577175_0012.png
Towards an Energy Union - Lithuania
6. Post-2020 Energy and Climate policy Strategy
COMPREHENSIVE MEDIUM TO LONG-TERM STRATEGY (post-2020)
FOR CLIMATE AND ENERGY
In 2012, Lithuania adopted a National Energy Independence Strategy, which contains
strategic initiatives until 2020, and lays down guidelines for the development of the energy
sector until 2030 and 2050. By 2050, Lithuania aims to be independent from fossil fuel and to
produce its energy from nuclear and renewable energy sources only. A revision of the
Strategy is planned.
In 2012, Lithuania adopted a Strategy for the National Climate Change Management Policy
for the period 2013 - 2050 as the country's low- carbon development strategy. The Strategy,
covering adaptation and mitigation policies, sets binding targets for 2020, and sets indicative
goals and objectives for the medium (2030-2040) and long run (2050). An Inter-institutional
Action Plan and biennial reports to Parliament have been established to ensure the timely
implementation of the Strategy, for which an update is planned after 2019.
NATIONAL TARGETS, especially for 2030
Objective, 2030-2050
GHG reduction
Targets
Yes,
indicative
Comments
The Climate Strategy sets the following indicative targets:
to contribute to the implementation of the proposed EU
medium-term indicative targets – GHG emission
reduction by 40% reduction by 2030, 60% reduction by
2040 and 80% reduction by 2050 as the long-term
perspective, by comparison with the level in 1990.
No specific 2030 target. Indicative targets outlined for
2050: 40-100% renewables in the energy mix; 0-30%
nuclear energy, and 0-30% fossil fuel with carbon capture
storage
No specific target for 2030; however, the Strategy for the
National Climate Change Management Policy includes a
long-term indicative target for a 1.5-2% annual
improvement in energy efficiency, while the National
Energy Independence Strategy aims at a 1.3% annual
improvement at least
Renewable energy share
Energy Efficiency / savings
No
(for
2030);
Indicative
(for 2050)
No
(for
2030);
Indicative
(long term)
7. Regional cooperation
EU Member States cooperation in the energy sector in the Baltic Sea region has brought many
benefits for the participating countries. The work and achievements within the framework of the
Baltic Energy Market Interconnection Plan (BEMIP) agreed in June 2009 and with subsequent
amendments in 2011 and 2013 respectively proved that enhanced regional cooperation can be a
catalyst for positive developments both in energy infrastructure projects or market related aspects.
The MoU on reinforced BEMIP was signed on 8 June 2015 with the overall goal to ensure further
market and system integration of the Baltic States into European Continental network and ensure its
full market functioning also strengthening the organisational structure of the BEMIP. The new MoU
and Action Plan also foresees regional cooperation in new energy policy areas, including electricity
and gas markets, security of supply, power generation, renewable energy and energy efficiency.
Regional cooperation on infrastructure development is necessary to optimise the identification of
regional infrastructure priorities and to coordinate cross-border investments. Lithuania is a member
11
kom (2015) 0572 - Ingen titel
1577175_0013.png
Towards an Energy Union - Lithuania
of two electricity and gas Regional Groups which
have been established under the trans-European
energy networks (TEN-E) Regulation, i.e. Baltic Energy Market Interconnection Plan in electricity
(BEMIP Electricity) and Baltic Energy Market Interconnection Plan in gas (BEMIP Gas).
Additionally, Regional Gas Market Coordination Group was established on February 12, 2015 to
facilitate creation of the effectively functioning regional gas market, consisting of the representatives
of the ministries responsible for energy policy, the national regulatory authorities of the energy
sector and the operators of the key gas infrastructure in the Baltic States and Finland.
8. Cohesion Policy Contribution
The EU Cohesion policy provides for important investment possibilities to implement energy policy
objectives in Lithuania which will be complemented by national public and private co-financing,
aiming at optimal leverage. It also ensures integrated territorial solutions to challenges by supporting
capacity building and territorial cooperation, including the Baltic Sea Region macro-regional strategy
in which Lithuania takes part.
Internal Energy Market:
Over 2014-2020, EU Cohesion Policy will invest some EUR 154 million in
smart transmission systems, as well as some EUR 21 million in smart electricity distribution grids in
Lithuania. These investments are expected to contribute to around 10 000 additional users
connected to smart grids.
Energy efficiency:
Over 2014-2020, EU Cohesion Policy will invest some EUR 540 million in energy
efficiency improvements in public and residential buildings and in enterprises, as well as in high-
efficiency cogeneration and district heating in Lithuania. A further estimated EUR 626 million will be
invested in supporting the move towards an energy-efficient, decarbonised transport sector. These
investments are expected to contribute to around 30 000 households with improved energy
consumption classification and a decrease of around 60 000 000 kWh per year of decreased primary
energy consumption of public buildings, as well as to around 70 km of reconstructed or upgraded
railway lines, and 20 km of new or improved inland waterways.
Decarbonisation:
Overall, the EU Cohesion Policy investments in Lithuania over 2014-2020 are
expected to contribute to an estimated annual decrease of GHG of around 680 000 tonnes of CO2eq.
Over 2014-2020, EU Cohesion Policy will invest some EUR 330 million in renewable energy in
Lithuania. These investments are expected to contribute to around 760 MW of additional capacity of
renewable energy production.
Research, Innovation and Competitiveness:
Over 2014-2020, EU Cohesion Policy will invest
significantly in R&I and in SME competitiveness in Lithuania. This will be based on the national
strategy for smart specialisation. For Lithuania, the Strategy
8
includes a focus on energy and a
sustainable environment priorities, namely (1) smart systems for energy efficiency, diagnostic,
monitoring, metering and management of generators, grids and customers, (2) energy and fuel
production using biomass/waste and waste treatment, storage and disposal, (3) technology for the
development and use of smart low-energy buildings – digital construction and (4) solar energy
equipment and technologies for its use for the production of electricity, heat and cooling. At this
stage, at least EUR 103 million is foreseen for investments in R&I and adoption of low-carbon
technologies in Lithuania, but this might increase further in line with the evolving content of the
smart specialisation strategy.
8
http://www.ukmin.lt/web/en/innovations/Smart_Specialisation.
12