By Murat Temizer
ANKARA
Lithuania’s adaptation to the euro following its Baltic neighbors Estonia and Latvia on Jan.1, 2015 may be beneficial for both the Baltic’s and the European energy market, experts say.
"The internal EU energy market, especially concerning electricity, is good for all countries concerned. It is valuable for both competition and energy security that European energy markets are as integrated and harmonized as possible," said Philip Lewis, expert and CEO of global energy think-tank VaasaETT.
He explained that the single currency, interconnectivity, common rules and regulations but most of all political devolution are all critical in this process.
"As long as Lithuania can stay comfortably in the euro, then I feel its membership of the euro can only be a positive direction in terms of energy security and investments. Gas is another issue and naturally far less euro centric, but in the longer term at least, the ability to be well connected to the internal electricity market of Europe will provide essential substitution potential and value," Lewis added.
The Lithuanian energy sector lacks diversity in its power production and the Baltic country is attempting to increase energy investments. To this end, Lithuania plans to complete high voltage interconnections with Poland and Sweden in 2015, according to Litgrid, Lithuania's electricity transmission system operator.
Lithuania has completed two thirds of NordBalt and half of the LitPol Link in 2014 and plans to complete the rest of the construction in 2015. Lithuania plans to complete high voltage interconnections with Poland and Sweden via these links. NordBalt will connect Lithuania to Sweden and LitPol Link to Poland's power system.
"Lithuanians joining the Eurozone is a sign of the country’s financial strength. With its relatively low foreign debt and its government’s fiscal discipline, the implication could lead to an increase in international ratings and inflow of foreign direct investments," said Valdur Lahtvee, director of the Climate and Energy Program at the Stockholm Environment Institute in Tallinn.
The Baltic’s only LNG terminal was built and became operational in Lithuania in 2014. The country made a deal with Norway’s energy company Statoil to import 0.54 billion cubic meters of natural gas for five years.
The future of Lithuania's energy sector and specifically the construction of the new Visaginas Nuclear Power Plant are pending on developments of nuclear power capacities in close neighboring regions like Russia and Belarus, where nuclear power plant projects are being developed.
Lithuania has four neighbors surrounding the country, to the north is neighbor Latvia, its eastern neighbor is Belarus and Russia and in the south Poland connects Lithuania to Europe.
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