Gas-for-power boosted by low prices
TSO transited 33 TWh to Baltics, Finland
Positive trend expected in 2021: CEO
London — Gas demand in Lithuania hit a five-year high in 2020 on the back of low LNG prices and increased gas-for-power demand, the country's gas grid operator Amber Grid said.
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Register NowConsumption rose 7% year on year to 25.1 TWh (2.37 Bcm), with Amber Grid CEO Nemunas Biknius saying he expected the "positive trend" to continue in 2021.
Gas use in the Baltics -- a region historically dependent on Russian gas imports -- was constrained in the early 2010s by high prices, but the picture has improved due to better interconnectivity and the start in 2014 of LNG supplies into the region via Lithuania.
Amber Grid said it transported 33 TWh of gas to consumers in Lithuania, Latvia, Estonia and Finland last year, a 12% increase on 2019 despite a warmer winter.
Adding the gas it transited to the Russian exclave of Kaliningrad, the total volume was 58 TWh, it said.
The increase in transported volumes, Biknius said, was a result of "extremely favorable gas prices and an especially competitive level of LNG prices".
"This encouraged market participants to use the Lithuanian gas infrastructure and flexible services at a gas transmission price which was 16% lower than in 2019," he said.
Amber Grid is preparing for another strong year in 2021 by further strengthening the network, expanding cross-border connections, investing in remote system management and developing competencies to operate the system in "conditions of uncertainty", he said.
Regional transit
Gas transit to Latvia through the Lithuanian gas grid for the needs of the Baltic states and Finland, and for gas storage at the Incukalns gas storage facility in Latvia, increased to 8 TWh in 2020, Amber Grid said. That was 33% higher than 2019 and the largest amount of gas ever transmitted to Latvia, it said.
Since the beginning of 2020, the markets of Estonia and Latvia have formed a common balancing zone, and while Finland remains a separate balancing area, it is a part of the common entry tariff area with Estonia and Latvia.
Improved interconnectivity between the countries and the wider gas market has been a focus for the four countries for a number of years as they look to reduce their previous dependence on Russian gas imports.
With the start-up at the end of 2019 of the 2.6 Bcm/year capacity Balticconnector, there has been a direct link between Finland and the Baltic region via Estonia for the first time.
Amber Grid said Lithuania was expected to play an "even more significant" role in the common gas market of the region from the end of 2021 when the construction of a gas pipeline connection with Poland will be completed.
Low spot LNG prices for most of 2020 -- ahead of the remarkable rally in the JKM benchmark spot Asian price toward the end of the year -- saw imports at Lithuania's Klaipeda terminal at 21.9 TWh last year, or 65% of gas supplied to the EU gas market through Lithuania.
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January 18, 2021 at 06:57PM
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Lithuanian gas demand at five-year high in 2020 on low LNG price: TSO - S&P Global
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