Apr 17, 2021
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Why the Baltics are refusing electricity from Russia

Lithuania for two days stopped receiving electricity from Belarus, Latvia at the same time refused to supply from Russia. The ultimate goal of the Baltic states is to get out of the common energy ring with the Russian Federation and the Republic of Belarus and arrange supplies from Scandinavia and continental Europe. Izvestia understood the specifics of the energy policy.

Tangled in the wires

Belarus on April 8 and 11 cut off all cross-border transmission lines (PTL) with Lithuania. The tests were carried out to check the readiness of the power system for the withdrawal of the Baltic countries from the BRELL power ring. During the tests, the power engineers turned off the high-voltage lines, looked at the operating mode of the power system and re-turned on the power lines in compliance with safety requirements.

At the same time, during the test days, Latvia, without explaining the reasons, stopped importing electricity from Central Russia. According to media reports, the Latvian system operator (AST) canceled the cross-flows on the Russia-Latvia section without warning. When asked by journalists about whether this step was due to technical necessity, representatives of AST refused to answer. According to the Russian side, there was no technical need for the shutdown.

Photo: Izvestia / Konstantin Kokoshkin

As a result of stopping power flows, the price of electricity in the European part of Russia and the Urals on April 8 decreased by 1%, amounting to 1.37 thousand rubles per megawatt-hour. The largest price reduction was recorded in the Kaluga and Bryansk regions. The cost of electricity in the Baltics, in turn, has increased significantly. In Lithuania, forced to increase purchases in Poland and Sweden, it increased by € 4 – to € 51 (4.7 thousand rubles) per megawatt-hour.

At the same time, the press service of the Russian electricity export operator Inter RAO noted that it is not entirely correct to talk about the complete refusal of the Baltic states from electricity from Russia, since supplies to Lithuania from the Kaliningrad region on April 8 and 11 continued.

The Fellowship of the Ring

The BRELL energy ring unites the energy systems of Belarus, Russia, Estonia, Latvia and Lithuania. The name is based on the first letters of the names of the states. The energy ring was formed back in Soviet times. Then the socialist countries of Eastern Europe were united into a single energy system “Mir”. After the collapse of the socialist bloc, the energy system shrank to five states. At the interstate level, the work of BRELL was regulated by an agreement of 2001. Within the framework of the energy ring, countries exchange electricity and support each other with reserves in case of emergencies.

Back in the 1990s, BRELL’s work was marred by political divisions. The contradictions intensified after the accession of the Baltic states to the EU and NATO in 2004. In 2017, the Center for Energy Security (a structural unit of NATO) prepared a report on the risks of energy dependence of the Baltic countries on supplies from Russia. After that, Estonia, Latvia and Lithuania held a series of consultations and decided to withdraw from BRELL. In 2019, the Baltic states and the European Commission approved a plan to synchronize the power grids.

Photo: Izvestia / Alexey Maishev

Lithuania was the main supporter of the withdrawal from BRELL. In Vilnius, additional irritation was caused by the construction of a nuclear power plant in Belarus. Local politicians called the nuclear power plant the root of evil, the machine of psychological hell, the bomb hanging over the eastern part of the EU. The Seimas of Lithuania first recognized the plant as dangerous, then the country’s enterprises were prohibited from purchasing BelNPP products under pain of revoking the license. Lithuania also tried to convince its neighbors to join the boycott of the BelNPP.

Finally, the Baltic states should withdraw from BRELL in 2025. It is assumed that electricity will be bought in continental Europe (Poland) and Scandinavia. At the same time, even now, part of the electricity comes from there. Thus, Lithuania covers about half of its needs through imports. 45% of imports come via the energy bridge from Sweden, another 5% – via the energy bridge from Poland. The rest is Russian and Belarusian electricity. Estonia covers part of the needs at the expense of Finland.

For the population of the Baltic States, the main consequence of the withdrawal from BRELL will be an increase in prices. If on the Russian wholesale market a thousand kilowatt-hours costs on average € 20-25, then on the Scandinavian energy market Nordpool the price exceeds € 40. Another possible consequence is supply disruptions. For example, this winter in Europe turned out to be harsh. And Sweden did not have enough capacity to cover its own needs. Stockholm had not to sell, but to buy electricity from Lithuania, which, in turn, bought it from Russia.

Russia will also feel the withdrawal of the Baltics from BRELL. The main consequence will, apparently, be that Russian power engineers will lose a significant share of the Baltic market. At the end of 2020, the same Lithuania became the main importer of Russian electricity. Vilnius purchased 3.1 billion kWh. These figures, however, are lost in comparison with the scale of the domestic Russian market. In the same 2020, Russia consumed 1,050.4 billion kWh.

Photo: TASS / Vitaly Nevar

In addition, difficulties could arise in the Kaliningrad region. It used to be supplied with electricity from Central Russia. In recent years, however, the region’s own production has increased significantly. In 2018, the Mayakovskaya TPP in the city of Gusev and the Talakhovskaya TPP in Sovetsk started operating, in 2019 – the Pregolskaya TPP in Kaliningrad, in 2020 – the Primorskaya TPP in the city of Svetly. The total capacity of the four power plants is 1 GW. As a result, the region is now able to support itself on its own.

Difficulties in transfer

Experts call the desire of the Baltic countries to withdraw from BRELL absurd. “Obviously, this is a political decision. The Baltic republics can buy electricity in Europe without obstacles and now, there are no restrictions. They just have more options now. If they leave BRELL, they will lose additional opportunities. It seems strange to refuse one of the suppliers with your own hands, ”Igor Yushkov, a leading analyst at the National Energy Security Fund, told Izvestia.

He adds that many are happy with the current situation. “The Baltics are solving their political issues, trying to get additional tranches from the EU for new infrastructure. Russia continues to trade and make money. Yes, by 2025 the three republics must leave BRELL. But it is not a fact that this will actually happen. The dates have already been shifted more than once, they can postpone it again, “Yushkov notes.

Photo: Izvestia / Alexey Maishev

Nikolai Mezhevich, President of the Russian Association for Baltic Studies, says that it is difficult to talk about the motives of the leadership of the three republics. “They are best described by the saying“ In spite of my mother, I will frostbite my ears ”. After all, as a result, prices for end consumers in the Baltics will rise. Ordinary Estonians, Latvians, Lithuanians will suffer, ”the source emphasizes.

Igor Karmazin

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