ELECTRICITY MARKET IN THE BALTIC COUNTRIES

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ELECTRICITY MARKET IN THE BALTIC COUNTRIES

• by prof. Vidmantas Jankauskas
• Chairman, National Control Commission
• for Prices and Energy
• Workshop Development of electricity markets and
  security of supply in the Baltic sea region
• Vilnius, 26 January 2006

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Electricity market liberalisation - Latvia

• TSO legally separated in 2005, transmission
  license issued in 2004
• Electricity Market Law passed in 2005
• formally market is open for all commercial
  customers
• in practice market does not work no one
  eligible consumer has switched,
• vertically integrated monopoly Latvenergo owns
  all the grid and most of generation

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Latvia Latvenergo

• Latvenergo is state-owned, vertically integrated
  monopoly
• Latvenergo production share is 93
• Latvenergo distribution share is 99

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Estonia electricity market liberalisation

• market opening 12 now, 35 in 2009 and full
  opening in 2013
• oil shale generated electricity takes 90 of the
  market
• DSOs are obliged to buy from Narva PP and CHPs
• National Grid company was set up as an
  independent company in 2004 legal unbundling
• one eligible consumer is supplied by a
  competitive supplier Narva Elektrivõrk which
  imports electricity from Ignalina NPP

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Estonia Eesti energia

• Eesti energia is 100 state-owned, vertically
  integrated monopoly
• Eesti energia owns more than 95 of power
  production
• Eesti energia has 90 of the distribution market

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Electricity market liberalisation - Lithuania

• market opening started in 2002, now all
  commercial consumers are eligible
• legally separate transmission, 2 distribution and
  several generation companies
• Ignalina NPP heavily dominates in the market
  (about 70 of the demand), plus CHPs, plus green
  electricity free market is very small
• few switches

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Market opening in Lithuania
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Electricity suppliers in Lithuania
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Electricity produced and sold in 2004
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Electricity market in the Baltics Source
National Reports, 2005
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Structure of generating capacities, MW 2005
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Transfer capacities in normal conditions (DC
Baltija)
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Usage of cross-border capacities in Lithuania,
January 2005Source National Report 2005
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Electricity prices for small commercial consumers
(50 MWh/y) (EC 2005 Report)
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Prices to final customers (/MWh)(National
Reports, 2005)
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Network charges, (/MWh)(National Reports, 2005)
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Electricity generation prices in Europe(EC
Report 2005)
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Future vision possible electricity trade in
2010(BCEM study, 2003)
LATVIA
2700
/ 1500 MW
4.7 / 7.5 TWh
ESTONIA
RUSSIA
2
63
0 / 1695 MW

8.5 / 8.0 TWh
LITHUANIA
LITHUANIA
3700
/ 2
40
0 MW
5449 / 2.040
10.8 / 12.1 TWh
17.390 / 9.701
BELARUS
FINLAND
1000 MW
1000 MW
POLAND
SWEDEN
Installed capacity / Max. system load
Total production / Total consumption
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Conclusions

• strong interconnections, good common generation
  mix (thermal, nuclear, hydro) are opportunities
  for a common Baltic electricity market
• political, legal and regulatory decisions to
  create a common market are already taken
• very important to agree among the 3 countries as
  for the Russias role in the Baltic market and
  finally commercialize all relations with this
  partner
• common electricity exchange is necessary
• exchange of information and coordination of
  investments in transmission is necessary

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Thank you for your attention

• www.regula.lt