The recent agreement between the Baltic states of Estonia, Latvia and Lithuania to develop a common energy policy for the future may result in a new nuclear power plant being built in Lithuania. Saulius Piksrys and Gunnar Boye Olesen offer an alternative vision in which a major new biomass-fuelled CHP sector would supply at least most of Lithuania’s energy needs.

Great changes are expected in Lithuania’s energy sector over the years following the country’s accession to the European Union on 1 May 2004. The closure of the Ignalina nuclear power plant by the end of 2009 will cut generating capacity by 1250 MW. The remaining thermal power plants and combined heat and power (CHP) plants are inefficient and obsolete; they require renovation and modernization to meet growing demand for electricity demand and to comply with EU environmental regulations.


A 384 MW CHP plant at Vilnius is currently fired on natural gas but could be converted to biomass in future. Biomass holds enormous promise in the Baltic states
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Scientific assumptions for a short-term energy strategy suggest that the most economically efficient way to replace the Ignalina plant is to modernize existing power plants to increase their energy efficiency and to improve their environmental performance. However, utilization of wind power and the conversion of gas-fired CHP plants to biomass would significantly reduce Lithuania’s dependence on imported fossil fuels. Recently planned grid connections with the western European system offer the possibility for electricity imports. They would also reduce utilization of existing power plants, reduce the need to build new generating capacity and ensure a safer alternative energy supply option.

Although a lack of generating capacity is forecast in the long-term, utilization of the existing renewable energy potential and the huge possibilities for increased energy efficiency are sufficient to meet future energy demands in Lithuania in the short term.

CO-OPERATION BETWEEN THE BALTIC STATES

At the beginning of 2006, aggressive Russian commercial activity in the natural gas and oil markets forced Lithuania’s politicians to reconsider previous energy strategies, to make the security of energy supplies the highest priority and take action to develop regional co-operation in the energy field.

As a first step in regional co-operation, the prime ministers of the three Baltic states signed a joint communiqué in which they agreed to prepare a common Baltic Energy Strategy. But despite an excess of generating capacity in the region, they also supported an initiative to construct a new regional nuclear power plant in Lithuania.

The leaders of the Baltic states invited the energy companies Lietuvos Energija, Latvenergo and Eestienergia to invest in the construction of a new regional nuclear power plant. A feasibility study to evaluate the technological, environmental, legal and economic aspects of the new plant was completed in October 2006. According to this study, it is feasible to build a new nuclear power plant although the assumptions used in the study have not been made available.


Situated between Vilnius and Kaunas, a 1800 MW power plant (four units each of 300 MW and four units each of 150 MW) is used to provide back-up capacity for Lithuania’s Ignalina nuclear plant. The back-up plant is very inefficient and obsolete, mainly working under a condensing regime because there are not enough heat users in surrounding areas
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Environmental non-governmental organizations (NGOs) in the Baltic states welcome the idea of regional co-operation on strategic priorities, especially in the development of an independent and diverse primary energy mix, including utilization of local renewable energy resources for the region.

However, environmental groups do not support the construction of new nuclear power plant in the region, arguing that it creates far more problems than it solves.

Instead, environmental groups are pushing for a crucial shift in energy sector development towards sustainability – to become environmentally friendly and sufficient to meet everyone’s energy needs.

AN ALTERNATIVE TO NEW NUCLEAR CAPACITY

More than ever before, the latest technologies are able to utilize energy efficiently and to use renewable energy resources without harming the environment. In an attempt to show how such technologies can change the current unsustainable energy sector into a sustainable system, NGOs developed the ‘Vision for a Sustainable Energy Development for Lithuania’ (referred to subsequently in this article as the Vision).

This aims to show how a significant part of energy demand in Lithuania could be covered by increasing the renewable energy share in the primary energy mix and by introducing sufficient energy efficiency measures.

A total shift towards a sustainable energy system is a complex and long process, but is one that can be achieved within a period of about 50 years. Implementation will require initial investment, long-term national strategies and action plans. However, the changes will have a number of benefits including:

  • a more stable energy supply than at present
  • a major improvement in the environmental performance of the energy sector
  • certain social benefits.

The Vision used a methodology and calculations based on computer modelling that utilized:

  • data from existing governmental programmes
  • information from studies and surveys on the recent situation in the energy sector
  • potential renewable energy sources and energy efficiency improvements
  • assumptions for future economy growth.

According to the assumptions used in the Vision, renewable energy use in Lithuania could reach almost 15% in 2010, 37% in 2020, 45% in 2030, 60% in 2040 and over 95% in 2050 as a fraction of the primary energy mix (Figure 1).


Figure 1. Predicted contributions of renewable energy sources in Lithuania to 2050
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For electricity, the renewable share is below the share of primary energy until 2020 and then higher (Figures 2 and 3). The most important developments are predicted in biomass and wind power, including the use of agricultural land for biomass plantations and the use of straw for heating and for CHP production.


Figure 2. Predicted changes in net energy supply in Lithuania to 2050
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Figure 3. Predicted development of electricity production and sources in Lithuania to 2050
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BIOMASS CHP COULD DOMINATE THE SUPPLY SIDE

Biomass is currently the most important form of renewable energy in Lithuania and will remain so until 2020 and beyond. Much of the current use of biomass is wood for district heating. A considerable part of wood biomass – especially residues from sawmills – is already used for heating purposes, but significant amounts of forestry and agriculture residues are still not collected.

To obtain sufficient biomass to meet the proposed increases in primary energy mix, dedicated straw and energy crop plantations are needed. The estimated annual use of straw in 2020 is 900,000 tonnes, equivalent to 35% of total straw production. The straw is made into large bales of 300-500 kg, which are stored on the fields near roads and covered with strong plastic. They are then sent by truck and, eventually, by train to CHP and heating stations during the heating season. This follows normal practice in Denmark and other countries.


Biomass-fired boilerhouse for heating and production of hot water at the children’s sanatorium in Kacergine. The conversion of the boilerhouse from gas-fired to biomass-fired in 2003 received backing from the Swedish Energy Agency. Since then heating costs have fallen significantly
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Until 2020, it is estimated that 2200 km2 (220,000 hectares) will be used for plantations of energy crops such as willow in short rotation coppice. It is assumed that the yield will reach 9 tonnes of dry matter per hectare. Although planting and cutting can be carried out with machines, there may be a need for manual weeding during the first year of growth. Substantially less fertilizer is required than for grain and most other crops, though poor soils can need more fertilizer. Wastewater sludge can be used as a fertilizer provided it has low levels of heavy metals and persistent organic pollutants; such substances can pollute the soil, causing a problem for future use of the land for food production. If fertilizer requirements become substantial (such as due to poor soil), more permanent forests can be an alternative to short rotation crops. Pesticides are not usually needed for energy crop plantations.

By 2020, the energy yield is expected to reach 35 PJ per year. Towards 2050, the energy plantation output is expected to increase by 20% either by allocating 20% more land for the purpose or by increasing the yield with agricultural improvements.


Solar collector at the children’s sanatorium in Kacergine, implemented together with reconstruction of a boilerhouse
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In terms of CHP plants, the Vision proposes an increase in use of solid biomass from 0.01 PJ in 2000 to 47 PJ in 2020. This would effectively create a new power sector that provided 79% of the power from CHP plants (remaining 20% from natural gas and 1% from biogas), resulting in the production of 21.7 PJ (6.0 TWh) of power.

With an annual use of 5700 hours (mainly baseload), there is a need to construct about 1100 MWe of CHP plants. Table 1 shows how this capacity could be distributed based on current heat loads in Lithuanian district heating systems.

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In addition to the CHP plants, it will be necessary to construct heat storage capacity in the form of hot water tanks to allow flexibility in heat delivery independent of power production; 6-12 hours of storage capacity should be adequate. This storage capacity would serve to make the energy system more flexible and efficient. For example, when heat demand is lower than electricity demand, the heat produced could be stored and deployed during peak demand.

The cost of biomass CHP varies between €1.3 million/MWe for large plants (i.e. 400 MWe) to €2.5-3.5 million/MWe for small plants (1-10 MWe). The proposal is for 850 MWe of large plants costing €1105 million and 300 MWe of small plants costing €750 million (€2.5 million/MWe) – a total investment of about €1900 million.

WIND POWER AND END-USE ENERGY EFFICIENCY

Wind power is the second biggest resource of renewable energy in Lithuania. The Vision proposes installing a total of 1000 MW of wind power by 2020.

The programme to install wind generators has begun and will result in the installation of 200 MW by 2010. To realize the target of 1000 MW, installations will need to continue at about 80 MW/year between 2010 and 2020.


Wind turbine from a 30 MW wind farm close to Palanga. The last two of the fifteen 2 MW units were completed in February 2007
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It is estimated that energy production from wind generators could reach 2 TWh (with 2000 load hours), which will replace other generation capacity. Installation of onshore wind power will require investment of €64 million/year between 2010 and 2020 (i.e. a total of €640 million by 2020). In addition, there is significant offshore wind power potential in the shelf of the Baltic Sea which could start to be utilized after 2020.

In Lithuania, energy intensity is still about two times higher than in the 15 older Member States of the European Union (EU-15). Energy efficiency can therefore be treated as an energy source. In particular, there are enormous possibilities for energy savings in the space heating sector. The Vision assumes that a 22% reduction of specific heat use in residential buildings will be implemented by 2015 and a similar 8%-9% reduction in service sector buildings (when proposals in the National Energy Savings Programme are realized). This will require investment in a number of heat conversation measures such as improvements to building envelopes (roofs, windows, floors, walls) and heating systems (insulation and renovation of pipework).

In addition to realizing the economic potential identified by the National Energy Savings Programme, a long-term effort leading to a 2% reduction in specific heat demand per year after 2015 is proposed. This will require:

  • further improvements in building codes
  • continued information on energy efficiency
  • ambitious implementation of the EU Buildings Directive on energy efficiency in buildings.

An increase of 2% per year is proposed for energy efficiency in electricity use. The proposed measures, including the payment of a 2% levy on electricity consumption, are expected to be cost-effective. Regular evaluations will be necessary to monitor the cost-effectiveness of the schemes to ensure maximum benefits for users and the environment.

OTHER RENEWABLE ENERGY SOURCES

Other renewable energy sources such as biogas, geothermal, hydropower and solar energy will form a smaller part in Lithuania’s total primary energy mix.

The estimated production from biogas plants is expected to be 1.37 PJ in 2020 and beyond, divided into 1.01 PJ from agriculture and wastewater plus 0.36 PJ from landfill gas plants. The investment would be about €5 million/MWe – that is, a total investment of €80 million for agriculture and wastewater biogas plants.

The western part of Lithuania is rich in geothermal resources. However, these are either too deep in crystalline rock layers or too saline and requiring additional treatment that is not economically feasible. The Vision took a conservative approach to the use of geothermal energy, proposing an increase from 0.8 PJ in 2000 to 2.9 PJ in 2020. This would cover almost 20% of energy production as heat (district heating stations only) or close to 9% of total district heating consumption as CHP will be the major source of district heating. This capacity would be built between 2010 and 2020. The increase in geothermal energy use of 2.1 PJ would require construction of geothermal heating plants with a combined capacity of 120 MW (assuming 5000 working hours per year). The economics of such plants depend very much on the site – in particular, the geothermal source available and the heat demand.

The expansion of hydropower use from 1.5 PJ to 2.7 PJ would be a combination of improving existing plant and constructing new, small hydropower plants. If two thirds of the increase is from new plants with an average capacity factor of 0.75 (6500 full load hours per year), this would require construction of 64 MW of small hydropower. In order to realize this growth, investors in the hydropower plants should have a guaranteed tariff for 20 years or another similar support scheme.

There is currently little market for solar energy installations in Lithuania, but this is expected to change after 2010 when the development of solar heating begins. This would result in average installations of 10,000 m2 solar of collectors per year between 2010 and 2020, resulting in a total of 100,000 m2 installed by 2020. Installation of solar heating on this scale will require investment of €2 million/year. Energy production from solar collectors could reach 40 GWh/year in 2020, replacing heat from natural gas, with an efficiency of 80%. This would reduce gas consumption by 50 GWh/year.

Nuclear energy will be phased out when the current nuclear reactor in Ignalina stops in 2009. Fossil fuel use is expected to grow until 2010 and then gradually be phased out until 2050 (Figure 4).


Figure 4. Fossil fuel development for Lithuania, 2000-2050
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Energy trading is expected to be much less than today, with only a moderate electricity exchange expected. Electricity exchange with little net import or export is likely to continue, exchanging electricity from renewable sources such as hydropower (currently imported from Latvia on seasonal basis) and wind power.

The gradual decline in the use of fossil fuels means that carbon dioxide emissions from energy production will fall and become negligible after 2050 (Figure 5).


Figure 5. Decline in carbon dioxide emissions from energy production
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Under the proposed scheme, the baseload would be covered by biomass-fired CHP and peaks would be covered by other renewable sources, mainly wind. A back-up capacity run on imported natural gas, energy storage facilities or electricity import would need to be available to allow for poor wind conditions.

IMPLICATIONS FOR THE BALTIC STATES

The Baltic states together have a diverse energy mix ranging from Estonian power plants fired by locally extracted oil shale, Latvian hydro resources and Lithuanian nuclear plants. The lack of primary energy resources is complemented with natural gas and oil products supplied by Russia. Underground gas storage facilities in Latvia contribute to the energy security of the Baltic states.

The Baltic states also have comparatively well developed and well interconnected power and natural gas supply systems, which allow redistribution of electricity or natural gas in geographical terms. However, these interconnections only work well among the Baltic states and their eastern neighbours, Russia and Belarus.

Only Estonia is connected to Finland’s grid and Latvia and Lithuania have no direct connection to the power systems of central or Nordic Europe. Projects are being developed to build:

  • a high-voltage transmission line to connect Lithuania’s power system to the Polish grid (estimated completion 2010)
  • an undersea cable to connect Latvia’s power system to Sweden’s grid (estimated completion 2012).

After the decommissioning of the Ignalina nuclear power plant in 2009, the major part of the electricity for the Baltic states could be generated by existing gas-fired power plants in Lithuania, Latvia and Estonia. According to energy experts, existing available capacity in the Baltic power system will be sufficient to meet regional demands until 2015. But to meet long-term energy needs, new generating capacity for the Baltic states will be required.

There are several alternatives to cover future Baltic energy demands, starting from the option of developing the sustainable energy sector based on renewable energy sources and increased energy efficiency, and ending with the recently proposed new nuclear power plant for the Baltic region.

There is also a possible transitional option – siting efficient gas-fired CHP plants next to heat users, thus ensuring not only electricity and heat supply but also implementation of energy efficiency measures. Which of these will be chosen depends, unfortunately, not on the logic of sustainability but on decisions made by Baltic politicians.

‘Vision for a Sustainable Energy Development for Lithuania’ (covering the period until 2050) demonstrates that gradual growth in the use of renewable energy sources and an increase in energy efficiency can meet the entire energy demand for a country such as Lithuania. Similar research is planned for Latvia in 2007 and for Estonia – possibly in the coming year.

However, the politicians are not thinking just about meeting the country’s energy demand but also about earning money by exporting electricity, and are promoting the construction of a new nuclear power plant in Lithuania.

The environmental NGOs in the Baltic states are urging the governments to adopt sustainable development of the Baltic energy sector by:

  • diversifying of primary energy sources to increase the contribution of renewable and local energy resources in the total energy balance
  • implementing measures for energy efficiency increase at the demand side and in the energy transformation sector
  • integrating the Baltic power systems into the central European and Nordic energy systems.

Saulius Piksrys is Central Eastern European Bankwatch Network’s Energy Co-ordinator in Lithuania. e-mail: saulius@atgaja.lt

Gunnar Boye Olesen is the European Co-ordinator for International Network for Sustainable Energy. e-mail: ove@inforse.org

‘Vision for a Sustainable Energy Development for Lithuania’ by Saulius Piksrys and Gunnar Boye Olesen seeks to demonstrate alternatives to the new nuclear power plant in Lithuania proposed by the Lithuanian Government. It is available from the INFORSE Europe website at www.inforse.dk/europe/VisionLT.htm