ENTSOG GRIP BEMIP 2014-2023 / Main Report

The following main conclusions are made and practical suggestions proposed for further development of the East-Baltic gas infrastructure based on the results of modeling: 1 Putting into operation Klaipeda LNG terminal provides diversification of gas market in Lithuania. However, due to limitations of gas transportation system it does not solve the problem of gas shortage in Lithuania in case of gas supply interruption through GMS Kotlovka. Presence of Klaipeda LNG terminal without enhancement of gas transmission system makes no significant impact on gas supply organization in other East-Baltic region countries in emergency cases. 2 Since gas supply via Gas metering station (GM) Kiemenai is limited to 12mcm/ day, pipe diameter DN500 would be feasible solution for construc- tion of gas pipeline Riga-Iecava-Kiemenai. 3 To organize the optimal gas flow from Inčukalns UGS to Finland, depending on technical conditions of Estonian networks (two different systems – MOP 55 and 38bar) a pressure reduction unit shall be arranged in the area of Tallinn (Estonia). 4 Depending on technical conditions of pipelines and based on results of manda- tory regular inspections, pressure in the gas transport systems of Latvia and Estonia that are involved in gas transit shall be gradually increased up to the project conditions. 5 In order to provide the same volume of gas to Finland, which is the largest market in the region, from regional LNG terminal that is located in Estonia (Paldiski) the diameter of Balticconector DN600 shall be used instead of DN500 with additional compressor capacity in Finland in case regional LNG terminal is located in Finland (Inkoo). In addition to modeling of gas flows, criteria N-1 was calculated as provided for by the Regulation (EU) No. 994 / 2010 of the European Parliament and of the Council of 20 October 2010 concerning measures to safeguard security of gas supply and repealing Council Directive 2004 / 67 / EC, were requirement of continuous operation of the natural gas infrastructure in the case of disruption of the single largest element in the system is defined as compliance with the so-called N-1 criterion, if the disrup- tion occurs in the regime of peak load. Results of calculations of criteria N-1 according to the formula provided by the Reg- ulation (EU) No. 994 / 2010 are reflected in Table 3.1.

However, the formula proposed by the Regulation (EU) No. 994 / 2010 on N-1 criteria calculation does not reflect the real situation because it does not take into consideration availability of gas and the technical conditions of the pipelines, but is based only on tech- nical max capacity of the entry points. Therefore, an alternative calculation of criteria N-1 is proposed. In this case, N-1 for Latvia is only 49.42% and for Estonia 62.69% in 2015 with significant improvement in 2020 after implementation of suggested projects, respec- tively 206.35% in Latvia and 168.25% in Estonia.

Values in %

2012

2015

2020

Lithuania

35.41

67.88

175.88

Latvia

206.88

206.88

333.33

Estonia

104.48

104.48

201.42

Finland

102.38

93.82

176.48

Regional

215.68

Table 3.1: N-1 results 2012, 2015, 2020

In order to integrate the East-Baltic “energy island” to the common EU gas grid, as the current Study proves, all projects that are included in the proposed list of the PCIs are vitally important and shall be implemented. The total estimated costs of all listed projects together are close to 1.8 billion EUR with the time span of implemen- tation from 2013 to 2025 . The new gas infrastructure investments are critical for the regional capacity and security of supply and / or for the supply diversification in the region. Depending on the gas market development in the East-Baltic region, commissioning of some projects might be delayed comparing to the initial plan or even some of them may be downscaled. However, in any case the total investment needed for the East-Baltic region exceeds 1 billion EUR by 2020, which in no way can be covered by the gas market alone. Moreover, taking into consideration nature of the projects many of them may lack commercial viability, but demonstrate significant

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Baltic Energy Market Interconnection Plan GRIP 2014–2023

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