During the Christmas holidays, the EstLink 2 cable linking Finland and Estonia was damaged, restricting the ability to import cheaper energy from the Nordic countries to the Baltic region. As a result, electricity prices in the Baltic countries, including Lithuania, recorded an increase, although the Christmas period helped to mitigate the effect somewhat.
According to Lithuanian grid operator Litgrid, during the week of 23 to 29 December, the average wholesale electricity price in Lithuania’s price zone on the Nord Pool exchange increased by 41% compared to the previous week, from €56/MWh to €79/MWh. Similar increases were also recorded in Latvia and Estonia.
‘Every year, electricity consumption decreases during the holiday season, which usually leads to lower prices. However, the damage to the EstLink 2 cable on the first day of Christmas became the biggest event of last week and month. Although the operation of the electricity system was not disrupted, the Baltic States had to replace cheaper imports from Finland with production from local thermal power plants and imports from Poland in the second half of the week. This pushed up electricity prices in the region. Fortunately, the Baltic States consume relatively little electricity during the holiday season, which by a considerable measure minimised the impact of this event on market prices,’ said Andrius Maneikis, market development expert at Litgrid.
Currently, transmission system operators from Estonia and Finland are investigating the causes of the outage and planning the necessary repair works. It is worth recalling that due to repair works, the EstLink 2 connection was unavailable for 7 months this year, which proves that the energy system of the Baltic countries already has experience in dealing with similar challenges.
Decline in energy production in Lithuania
In Lithuania, electricity consumption fell by 3% in the last week of December, from 254 GWh to 246 GWh. At that time, 43% of Lithuania’s energy needs were met by imports, an increase of 10% compared to the previous week. 82% of imports came from Scandinavian countries through the NordBalt connection, 15% from Poland and 3% from Latvia. Lithuania’s energy exports fell by 64% (from 72 GWh to 25 GWh), of which 82% was directed to Latvia and the remaining 18% to Poland.
The capacity of the LitPol Link was used 59% towards Poland and 26% towards Lithuania. The NordBalt connection, on the other hand, was used 97% towards Lithuania, while it remained unused towards Sweden.
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