Lithuania gas-fired plant loss will not risk supply security – regulator

Lithuania’s energy regulator has said that the potential loss of 900MW of gas-fired power generation capacity, which utility Leituvos Energija is seeking to retire by 2016, will not impact supply security.

Utility Lietuvos Energija published the results of a study on Wednesday suggesting that under current market conditions it was no longer feasible to keep running the 1.8GW Elektrenai complex, consisting of combined-cycle gas turbine (CCGT) units.

According to the company, over the past three years, the complex has not had more than three units running at the same time.

Regulator the National Commission for Energy Control and Prices told ICIS that the closure of the plant did not require permission from the regulator. “In Lithuania such a move does not require the regulator’s permission, however, the regulator has been informed about such plans a reasonable time in advance,” said Tomas Milasauskas, head of the electricity division.

Milasauskas said the decommissioning of the four gas-fired units will not significantly affect the level of security of supply in the market because two of the units had already been in cold reserve for a couple of years on grounds their energy production economics were very uncompetitive.

The Baltic country has some of the highest power prices on Nordic electricity exchange Nord Pool Spot because of a high reliance on old oil- and gas-fired power plants with low efficiency rates generating with relatively expensive fuels.

Units B-5 and B-6, at 300MW of capacity each, will be withdrawn once new interconnectors with Sweden and Poland are launched.

A new operating model will be considered for the provision of reserve services without having units 1-6 in operation.

Then a formal decision will be made for mothballing units B1 and B2 in early 2015, and for B5 and B6 for mid-2015.

According to the scenario outlined in the study, from 2016, the power generating capacity at the Elektrėnai complex would comprise a modern CCGT unit of 455MW and two units, B-7 and B-8, each of 300MW capacity, that can generate electricity by burning both gas and oil shale.

New capacity

A spokeswoman for the regulator said that any supply security issues that could arise would be covered by the new interconnectors linking Lithuania and Sweden, and Lithuania and Poland.

Lithuanian transmission system operator (TSO) Litgrid has previously said the increased interconnection was expected to trigger an easing of Lithuanian power prices from the end of 2015, when the 700MW NordBalt cable to Sweden comes online ( see EDEM 17 January 2014 ).

However, market sources were divided about the possible impact of the Polish cable.

In addition Lithuania, which is highly dependent on Russian gas imports, is seeking to further diversify its energy supply with LNG. A newly built 170,000 cubic metre floating storage and regasification unit has started trials and is due to process its first commercial volumes in the last quarter of this year.

The regulator spokeswoman also said a new nuclear power plant was still under consideration, awaiting a regional decision.

The regulator said attempts were made to assess if mothballing the proposed capacity would represent any obstacles for the TSO to acquire enough electricity to cover systematic services on the market.

“The company inquired about the Litgrid position and has been given the answer that the transmission system operator has no objection to the implementation of the scenario in question,” she said.

TSO Litgrid could not be reached for comment at the time of writing. Sonja Caymaz