370 likes | 636 Views
POWER SECTOR OF LITHUANIA and OVERVIEW OF OPPORTUNITIES. R ymantas Juozaitis Director General Lietuvos energija AB PAN BALTIC PPP CONFERENCE-SEMINAR Vilnius, 22-23 November 2006. ELECTRICITY CONSUMPTION IN REGIONS OF EUROPE IN 2004. 9 TWh. 390 TWh. Russia 930 TWh. IE. Baltic IPS
E N D
POWER SECTOR OF LITHUANIA and OVERVIEW OF OPPORTUNITIES Rymantas Juozaitis Director General Lietuvos energija AB PAN BALTIC PPP CONFERENCE-SEMINAR Vilnius, 22-23 November 2006
ELECTRICITY CONSUMPTION IN REGIONS OF EUROPE IN 2004 9 TWh 390 TWh Russia 930 TWh IE Baltic IPS 25 TWh UK 420 TWh 510 TWh Centrel 260 TWh UCTE 480 TWh 320 TWh Iberia 280 TWh
THE STRUCTURE OF POWER SECTOR IN LITHUANIA • PRODUCTION: • 3 production companies • 3 CHPs owned by district heating companies • Few private mini HPP • Few industrial power plants • DISTRIBUTION: • Three distribution companies (one private) • TRANSMISSON: • One Transmission System Operator company – Lietuvos Energija AB
THE CLOSURE OF IGNALINA NPP • The EU has made the early closure of Ignalina NPP a precondition for Lithuanian- EU membership • Unit I was shut down on December31, 2004 • The closure of Unit II is scheduled in 2009 • Ignalina NPP can be substituted by Lithuanian PP,but this power plant has to be upgraded to meet environmental requirements • Ignalina NPP is a dominant producer and its closure will place the power system and the market in a completely new situation
INSTALLED CAPACITY (MW) PLANTS Tallinn • ESTONIA NARVA TPP BALTIA TPP TALLIN CHP 1615 1090 190 2895 ESTONIA LATVIA RIGA CHP-1 RIGA CHP-2 RIGA HPP KEGUMS HPP PLAVINAS HPP 142 390 402 263 870 2067 LATVIA • Riga LITHUANIA LITHUANIA KAUNAS HPP IGNALINA NPP KAUNAS CHP MAZEIKI CHP VILNIUS CHP LIETUVOS TPP KRUONIO PSP 100 1300 178 194 384 1800 900 4856 • Vilnius MAIN GENERATION FACILITIES IN THE BALTIC STATES Dependance on energy produced from natural gas
A NEW NUCLEAR POWER PLANT • The Prime Ministers of Lithuania, Latvia and Estonia signed Communiqué on 27th of February, 2006, where the following energy cooperation objectives were stated: • To prepare a common energy strategy of the Baltic States by the end of 2006; • To cooperate fully on and support the construction of interconnections between the Baltic and other EU counties; • To support the initiative to build a new nuclear power plant in Lithuania; • To invite the state owned Baltic energy companies Lietuvos Energija, Latvenergo and Eesti Energia as the participating parties, on equal terms among them, to invest in the preparation and construction of the new nuclear power plant in Lithuania.
Governments of Estonia, Latvia, Lithuania Eesti Lietuvos Latvenergo Project Sponsors Energia energija Dresdner Kleinwort (Financial) Freshfields Bruckhaus Appointed Advisors Deringer (Legal) Colenco (Technical) MAIN PARTIES INVOLVED IN PREPARATION OF THE FEASIBILITY STUDY
WORKING GROUPS OF THE FEASIBILITY STUDY • The Technical and Environmental Working Group, responsible for conducting technical assessment of best available technologies for the new nuclear plant, possible reactor size, and the potential investment and operational costs of the facilities • The Financing Working Group, responsible for economic and financial appraisal of the Project, • The Legal Working Group, responsible for structuring the Project in the light of applicable legal, contractual, regulatory and EU law requirements • The Transmission Working Group, responsible for investigating the adequacy of the Baltic transmission system for ensuring power flows from the new plant in Ignalina to power systems in all countries involved and estimating the reserve capacity required after construction of the new plant.
ANALYSIS WAS BASED ON INFORMATION AVAILABLE TODAY ON: • available reactor technologies • current market environment for commodities (in particular oil and gas) • legal and regulatory framework for nuclear generation specifically in the Baltic region • applicable legal framework in Lithuania and the EU • technical status of the interconnected Baltic system • current and forecast financial standing and financial market environment
BALANCE OF CAPACITY IN THE BALTIC STATES 430 MW 4170 MW 2500 MW 540 MW in Estonia in 2012
BALANCE OF CAPACITY IN THE BALTIC STATES(optimistic scenario) 2012 540 MW in Estonia 2015 400 MW in Latvia 2018 400 MW in Lithuania
INDICATIVE ELECTRICITY GENERATION NEW ENTRY COSTS FOR DIFFERENT FUELS
CONCLUSIONS OF THE STUDY The main conclusion – It would be feasible to develop a new nuclearpower plant to replace Ignalina NPP • Lietuvos energija, Latvenergo and Eesti Energia undertaking jointly to build a new nuclear power plant appears feasible from a technical, electrical system, financial and legal perspective; • Likely cost advantage of nuclear reactor over alternative sources of new generation; • Sufficient space at the Ignalina NPP site is available to accommodate the new nuclear reactor units; • Availability of suitable reactors designs; • The nuclear fuel market is effectively a global market; • The current electrical system is capable of accommodating up 3000 MW of nuclear capacity.
ALLOCATION OF NEW NUCLEAR UNIT AT IGNALINA NPP one reactor case
ALLOCATION OF NEW NUCLEAR UNIT AT IGNALINA NPP Two reactors case
NEW INTERCONNECTIONS Expected future interconnections: • Estonia – Finland • Sweden – Lithuania • Poland – Lithuania Main objectives and benefits: • Integration of the Baltic power systems into the EU IEM • Ensuring security of supply in the Baltic region
NORDEL NORDEL Sweden Zviedrija Finland Somija ESTLINK 350 MW 11.2006 Norvēģija Norway Integrated Baltic Lithuania - Sweden 1000 MW and CIS energy system Estonia Igaunija Russia Krievija Latvija Latvia Lithuania Lietuva Dānija Dānija Belorus Baltkrievija UCTE/ UCTI/ Polija Poland CENTRAL Europe CENTRAL Lithuania – Poland 1000 MW Ukraine Ukraina Vācija Germany Czech Čehija EXPECTED INTERCONNECTIONS OFBALTIC TRANSMISSION GRID
INTERCONNECTION ESTONIA – FINLAND (ESTLINK) • Three Baltic power companies (Lietuvos Energija, Latvenergo and Eesti Energia) and two Finish companies signed the Agreement on July 7, 2004; • Capacity of interconnection - 350 MW; Total investment cost of ESTLINK – 106 million EUR: • Debt – 84 million EUR (loan agreements signed on 29 04 2005 by NEL) • 53 million EUR loan from Nordic Investment Bank • 31 million EUR loan from AS SEB Eesti Uhispank • Share capital of NEL – 22 million EUR (paid in 29 04 2005) • 39.9% AS Eesti Energia • 25% State JSC Latvenergo • 25% AB Lietuvos energija • 10.1% Pohjolan Voima Oy and Helsingin Energia/City of Helsinki subsidiary Finestlink Oy. Projected commissioning of interconnection – December 4, 2006.
INTERCONNECTION LITHUANIA – SWEDEN • Capacity - 750 -1000 MW • Length – ~350 km • Investments – ~€ 400 m • Terms of Reference of the Feasibility Study are agreed between AB Lietuvos energija and Svenska Kraftnät • Feasibility Study will provide detailed technical and economic analysis of the Interconnection • Tender for Preparation of the Feasibility Study is announced
INTERCONNECTION LITHUANIA- POLAND • LT-PL interconnection project is listed in the European Commission “Quick start” projects’ list and in the updated TEN Guidelines; • €142.8m for interconnections for 2007-2013 are marked in the programme of Ignalina NPP closure; • The line route has been defined on the Lithuanian territory ; • Lithuanian side is ready to start the implementation of the Project immediately by establishing a project implementation company; • Polish side is willing to continue with analysis; • In 2006 Polish Government approved the Program on Electricity of Poland where the top priority was given to new interconnection with Germany, strengthening of Polish grid, rehabilitation of 750kV line with Ukraine. Only after that the Program contains the provision on interconnection between Lithuania and Poland, on the condition that the pay- back of the project and EU financial support will be ensured.
INVESTMENTS IN INTERCONNECTION LITHUANIA - POLAND According IPA-EBRD study, year 2003: Financing: The upgrading of the Baltic states power plants is presently implemented by using financial sources not related to the project. Remaining part of investments for LT- PL interconnection is 304 mln. €.
INVESTMENTS IN INTERCONNECTION LITHUANIA - POLAND (continued) Financing of the Project
CONCLUSIONS • The new nuclear power plant and new interconnections will enhance security of energy supply in the region and will reduce dependence on one supplier. Cooperation of private and public funding is needed. • Interconnections Lithuania-Sweden and Lithuania-Poland will create conditions to integrate Baltic electricity market to Nordic and Central European markets and to be more efficient. Cooperation of private and public investments is needed. • Development of cooperation of the Baltic power companies facilitates security of electricity supply and affordable prices