Energy transmission and exchange group EPSO-G predicts that the country’s energy sector will undergo a major transformation within a decade, with the completion of energy interconnections with Western Europe, significant additions to generating capacity from renewables, including wind farms in the Baltic Sea, and the production and use of hydrogen. As part of the new strategy, the Group plans to invest around EUR 1.8 billion by 2030.
Rolandas Zukas, CEO of EPSO-G, who presented the Group’s strategy until 2030 on Thursday, said that the changes ahead are crucial for a stable, sustainable and efficient system. EPSO-G’s strategy has been prepared in accordance with the expectations of the company’s shareholder, as set out in the letter approved by the Minister of Energy of the Republic of Lithuania on the State’s objectives and expectations.
As the world fights with the challenges of climate change, alongside the integration into Western Europe’s energy networks and energy security, which is of paramount importance to us, there is an equally important Green Deal target. We see our key role in ensuring Lithuania’s smooth and reliable transition to a RES-intensive energy system, enabling the decarbonisation of the sector and facilitating the exchange of climate-neutral energy,” said Rolandas Zukas.
According to EPSO-G, Lithuania has the potential to integrate up to 5 gigawatts (GW) of onshore renewable energy sources (RES) and offshore wind by 2030. Accordingly, flexibility measures will increase in importance, with the energy storage facilities system project contributing to the integration of RES.
“As early as 2022, a system of 200 megawatts and 200 megawatt-hours of energy storage will be operational, which will enable reliable and stable operation of Lithuania’s electricity system until synchronisation with the continental European grid, as well as ensure smooth integration of large amounts of RES,” commented Zukas.
Hydrogen will become a significant element of the electricity system later on. According to the CEO of EPSO-G, hydrogen is the one that could accumulate and transfer green energy to other sectors. Electrolysis will be the main technology for producing green hydrogen, when green electricity will be used to produce hydrogen, which can be used in its pure form in the transport, industrial or energy sectors, or blended with natural gas to be used in existing equipment.
As part of the new strategy, EPSO-G Group plans to invest around EUR 1.8 billion between 2020 and 2030. Around half of the total investment needed is expected to be financed by own or borrowed funds, with more than a third coming from EU financial support and the remainder from other sources, most of which will come from congestion income. Between the start of 2020 and the end of June this year, EPSO-G has already invested around EUR 185 million in the country’s strategic energy infrastructure.
“We forecast that the socio-economic benefits of the investment for Lithuania over a decade will amount to around EUR 4 billion, with a financial return of around EUR 160 million. We estimate that the Group’s revenues will increase by a third to EUR 357.6 million within a decade, with the main source of growth coming from non-regulated activities, which will double by 2030 and account for at least 16% of the Group’s revenues,” says the CEO of EPSO-G.
“In the context of the transformation of the energy sector, EPSO-G will play a leading role in the development of cross-sectoral integration of the electricity, gas and heat sectors, as well as in the deployment of new technologies and solutions,” says Zukas.
Renewable energy sources (RES) are expected to account for 45% of final consumption in 2030 and 80% in 2050, while the share of RES in the balance of electricity consumption and in transport is expected to be 45% and 100%, and 15% and 50% respectively. The European Union has set a target of 50–55% lower carbon emissions in 2030 than in 1990, a 32% share of RES in final energy consumption and a 32.5% increase in energy efficiency.