New nuclear power plant in Lithuania: utopia or realistic project?

New nuclear power plant in Lithuania: utopia or realistic project?

By Aivaras Bagdonas, VU TSPMI doktorantas

Pursuant to the National Energy Strategy which came into force in 2007, Lithuania decided to build a new nuclear power plant by retaining the infrastructure of the current Ignalina NPP. It was envisaged to finalize construction of the new NPP not later than by 2015. Realization of this project could help Lithuania to become independent on energy import in case of closure of Ignalina NPP.

However, it seems that realization of this vision becomes more and more problematic. Since Lithuania is yet unable to start construction works of a new NPP (Visaginas Nuclear Power Plant), the regional context is rapidly changing in prejudice of Lithuania.

One of the main reasons is increasing competition of nuclear energy producers in the region. Belarus and Russia are ready to fill in the nishe of the decommissioned Ignalina NPP. In 2010 Russia started construction of the Baltic Nuclear Power Plant (NPP) in the Kaliningrad Region. Its first block should be launched in 2016, the second in 2018. Belarus is also getting prepared for the construction of a new NPP in Ostrovets (Grodno Region, close to the Lithuanian border). The first block is to be launched before 2016.

Differently from Visaginas NPP, the above projects are under way, thus, most probably these NPP will start delivering energy to the European market much earlier than Visaginas NPP (it could start operations not earlier than by 2018).  Thus, for Lithuania it will be very difficult to enter the market.
 

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An important moment related to the construction of NPP in Belarus and Kaliningrad Region is export potential. Belarusian NPP project is less non-acceptable for Lithuania, since is designed for the internal market of the country, but the Baltic NPP could be a real challenge for Visaginas NPP: its energy will be delivered abroad, since Kaliningrad Region will not consume such large amounts of energy.

Russia’s efforts to develop energy links with Poland prove the above. These links will open the door for Russian energy to Polish, Central and Eastern European markets, and, through the envisaged Lithuanian and Swedish link – to the Scandinavian market.

Visaginas NPP, which will start operations much later, will have to compete with Russia seeking to consolidate its position on the European energy market. Visaginas NPP would hardly generate cheaper energy than Baltic NPP, therefore at the beginning Lithuania will have to sell energy to neighboring countries by lower prices compared to its production and transmission costs.

Finally, Poland could also take part in the competition for energy generation. Pursuant to the amended nuclear energy program approved by the Government in 2010, Poland is going to construct two NPP’s. According to Prime Minister D.Tusk, the first of four blocks should be launched in 2022. Thus, more competitors might be interested in pushing Lithuania from the Polish and European energy market.

The issue of energy link between Lithuania and Poland could also be considered an obstacle in solving the dilemma of Visaginas NPP. After launching a 3400 MW power plant in Visaginas (decision on the capacity of Visaginas NPP is not yet made), Poland could become one of the markets for Lithuania’s surplus energy.

However, according to the daily Gazeta Wyborcza, energy grids in the northern part of Poland will not withstand the load if Poland decides to use links to Visaginas and Kaliningrad. Lithuania urges Poland to accelerate construction of a 1000 MW transmission line Kruonis-Alytus (LT) -Elk (PL), meanwhile energy link with Kaliningrad is negotiated between Moscow and Warsaw.

By energy transmission lines from Elk toward the West Poland would open a corridor for the Lithuanian energy to own market, and later to Germany and other states. According to the daily Rzeczpospolita, extension of Lithuanian and Polish power grids would be especially inconvenient for Moscow. Russian concerns Rosatom and Inter RAO EES assured representatives of the Italian company Enel and Spanish Iberdrola involved in the construction of the Baltic NPP, that Kaliningrad NPP will deliver energy to Poland and Baltic States. If these companies refuse to take part in the Russian project and continue the Visaginas NPP project, the Baltic NPP could hardly be finished on time. Thus, Russia will probably try to suspend the development of energy link Kruonis-Alytus-Elk and hinder realization of the Visaginas NPP.

A 700 MW energy line NordBalt passing through the Baltic Sea and connecting Klaipeda with the Nybro city (Sweden) could also be considered an important energy transmission corridor. It should be launched by 2016. However, an opposite scenario is also possible: if NPP is not constructed in Lithuania, NordBalt would become a bridge for exporting Russian energy to the Scandinavian market. Russia would only have to slightly “push” Lithuania to get access to the cable to Sweden, but then Lithuania would be even more dependent on Russian energy. Russia might get attracted to NordBalt and proceed hindering construction of Visaginas NPP.

The increasing skepticism in Lithuania, quite often based on scientific arguments, might also hinder construction of Visaginas NPP. According to skeptics, Lithuania could do without nuclear power plant if it manages to find other ways for energy generation. According to the scientist Jurgis Vilemas, by 2015, eleven Lithuanian power plants are expected to produce 982 megawatts’ worth of additional capacities in excess of its internal demand. Besides, renewable energy in Lithuania accounts for only 3 percent of the total capacities, therefore it should be stimulated. By the operating energy link Estlink and future links NordBalt and Kruonis–Alytus–Elk, other providers (alternative to Russian) could supply energy to Lithuania. According to the scientist, if Lithuania has potential resources, it doesn’t need to build a nuclear power plant.

There are other arguments as well. It is assumed that for Lithuania construction of the Visaginas NPP is not cost effective, since nobody knows its price and when it will pay off. Its operational costs haven’t been estimated as well. Besides there is no plan regarding waste management.

But the above arguments don’t give the answer to very important question for Lithuania: how to reduce energy dependence on Russia? If Lithuania refuses to build Visaginas NPP, it’ll be made to use more Russian gas and oil. It is also not clear what would be the price of energy delivered by energy bridges from the West and North. Lithuania could also purchase energy generated by the Baltic NPP (for lower prices), but this would hardly be acceptable for Lithuania.

Nonetheless, criticism toward construction of Visaginas NPP could be justified partially.  Today there are no major obstacles which could make Lithuania to refuse own nuclear ambitions.  A real threat to Visaginas NPP is possible only if its realization is considerably delayed.
 
 
Geopolitika
 
 
 
09.02.2011
 
 

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