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New Europe - new energy

*Over he past five years, the Open University (OU) based New Europe-New Energy project has been looking at sustainable energy options in the new and candidate Central and Eastern EU countries. It started off focusing on the Baltic states, and then moved on via Bulgaria and Romania to the Balkans, linking up with local agencies, academics and practitioners and organising conferences and seminars.

Some of the new European countries have very large renewable energy potentials. For example, by 2005 Romania was already obtaining 17.8% of its energy from renewables and the target agreed with the EU is for 24% by 2020; Slovenia had reached 16% by 2005 and has a 25% 2020 target; Estonia was at 18% in 2005 and has a 25% 2020 target; while Latvia was at 34.9% and has 42% 2020 target. That makes the UK’s 1.3% in 2005 and 15% 2020 target look pretty low.

Of course, unlike the UK, some of these countries have large hydro installations and also major biomass resources, and we have only just started developing our very large offshore-wind, wave and tidal resources. Even so, it could be that in the years ahead, eastern and central Europe could be major players in the renewable-energy field.

Lithuania

After having looked at the potentials in Kosovo and Albania, the OU project recently returned to where it started, looking again at Lithuania, to see what progress had been made, in county with a mid- to high-range potential. It noted that the binding EU renewables target for Lithuania is 23% of total energy consumption by 2020. Lithuania has set a national target of obtaining 12% of its energy from renewables by 2010 and 7% of its electricity. By 2005 it had reached 3.61% of electricity and 15% of total energy consumption.

So what’s on offer? Lithuania has a quite significant wind resource and although only around 54 MW has been installed so far, expansion is expected, with the European Wind Energy Association (EWEA) predicting 200 MW by 2010. There could be an overall 54 times increase between 2006 and 2017.

Lithuania also has over 8 MW (th) of biomass heating capacity in operation and has introduced new biomass technology in seven regional heating plants throughout the country supplying 14% of the country’s heat.

The current overall situation in district heating supply is 78% from natural gas, 18% from biomass and 2.6% from crude oil. However, the Updated National Energy Plan aims for 50% of Lithuania’s central heating to be provided by biomass thermal production by 2020.

While the heat market is strong, the value of electricity is higher and Lithuania already has more than 3 MW installed biomass-fired generation capacity with a nine-fold rise in electricity generation from biomass expected between 2006 and 2017. At present though, hydro is the main source of green electricity in Lithuania, with 128 MW in operation in 2006, representing 91% of the total electricity generated from renewables. By contrast wind was at 3% and biomass 6%.

Lithuania has adopted a Feed in Tariff in 2002. The tariff levels will stay unchanged until 2020. In addition, the Law on Heat (2003) encourages municipalities to purchase heat produced from renewable-energy sources. EU Structural Funds will be allocated to new boiler houses and CHP plants from 2007 to 2013 (approx €36.8 m).

Lithuania looks like exceeding its Kyoto emissions reduction target. The UNFCC note that, in 2006, Lithuania’s emissions were 53% lower than the base-year level, well below its Kyoto target of –8% for the period 2008–2012. According to Lithuania’s projections, with the existing policies and measures, emissions will still only increase by 2010 to reach a level 30% below base-year emissions. So Lithuania still expects to overachieve its target significantly.

Therefore reducing emissions is not an urgent issue as such. But reducing gas and oil imports from Russia is seen as vital, as is stimulating the economy and creating employment. Renewables offer one way to achieve these goals, while also meeting the EU’s mandatory Renewable Targets.

Nuclear is sometimes also seen as vital – although it cannot be used to meet the EU renewables target. Lithuania closed Unit I of its Russian-era Ignalina plant in 2004, as a requirement of entry into the EU. But it now wants a replacement, though with the recession that looks some way off. As a stop gap it’s trying to keep Unit II going beyond the closure date agreed with the EU – the end of 2009. That could be very contentious.

Bulgaria

A somewhat similar situation seems to have emerged in Bulgaria, where there are currently hopes of extra compensation from the EU for shutting down the Kozloduy reactors 1 and 2, which could influence scheduled decisions on finance for the proposed new Belene nuclear plant on the shores of the Danube. The expected costs of that have escalated from €4 bn to €10 bn. The EU is paying compensation for the decommissioning of the two old units in 2006. But more will be needed – and yet with the recession, money is tight. And as the WNN news service put it: “In absence of private funding, alternatives for funding two new large reactors at Belene range between Russian state funding and potentially Bulgarian state funding, both of which are controversial.”

Certainly it would be odd to have to rely on Russian support, if one of the aims of going nuclear was to reduce reliance on Russia. Especially given its reasonably good renewable resources – not as large as Lithuania, but Bulgaria still reached 9.4% from renewables by 2005.

Part of the rationale for a return to nuclear there and in Lithuania is that it is claimed that nuclear power will be cheaper than renewables. This is debatable. New nuclear projects in France and Finland have repeated the familiar problems of construction delays and major cost overruns, while wind power has been claimed as more economic in some contexts. For example, see the data at www.sourcewatch.org/index.php?title=Comparative_electrical_generation_costs produced by the California Energy Commission for May 2008, which put wind as the cheapest operational source, significantly lower than all of the other options, including coal, gas, hydro and nuclear.

As elsewhere in the world, in parts of new Europe, the rivalry between these two very different energy options continues…

*Based in part on an article for the October edition of the Newspaper of the British Chamber of Commerce in Lithuania.

Posted by Dave Elliott on November 28, 2009 7:51 PM | Permalink