Bloomberg News

Lithuania Needs Cheaper Gas, Not Reactors, Vesaite Says

April 04, 2013

Lithuanian Economy Minister Birute Vesaite urged the government to alter its energy tactics to seek cheaper natural-gas supplies from Russia’s OAO Gazprom (OGZD) and reject a nuclear reactor that Japan’s Hitachi Ltd. proposed.

“Our objectives could be achieved in a way that better serves consumers’ interests and business competitiveness,” Vesaite said today on Ziniu radio in the capital, Vilnius, as Prime Minister Algirdas Butkevicius prepares for a meeting with Russian Prime Minister Dmitry Medvedev tomorrow.

Butkevicius’s Cabinet, which took office in December, is reviewing plans for a possible new nuclear plant to replace closed Soviet reactors and reduce reliance on Russian energy imports. It also seeks to convince Gazprom to reduce prices for Lithuania, which Vesaite said are 20 percent higher than what Baltic neighbors Latvia and Estonia pay for Russian gas.

Estonia and Latvia pay Gazprom less because “they’ve been much more pragmatic” by agreeing to delay implementing European Union requirements for separating the ownership of gas sales and transmission, Vesaite said, commenting on similar remarks by Russian Ambassador Vladimir Chkhikvadze reported yesterday by Lithuanian media, including Baltic News Service.

Gas Splitup

Lithuania this year is splitting up gas utility Lietuvos Dujos (LDJ1L) AB, of which Gazprom owns 37 percent. The Russian company, which also owns 34 percent of Latvian utility Latvijas Gaze AS and 37 percent of Estonia’s Eesti Gaas AS, had asked the government to delay the change, after which it will be forced to sell its shares of the spun-off new transmission company.

The government won’t change its mind about implementing EU rules on energy company ownership, Butkevicius said today in response to Vesaite’s remarks, Baltic News Service reported.

“Yes, the minister’s comments today were her personal opinion, not the official position of the government,” Vesaite’s Spokeswoman, Jurate Antanaityte-Voldemariene, said by phone.

Since closing the Soviet-built Ignalina nuclear plant in 2009, Lithuania, which isn’t connected to EU energy grids, also relies on imports of Russian power. In a non-binding October referendum, voters in the Baltic nation rejected the previous government’s plan to hire Japan’s Hitachi (6501) to build a 1,300- megawatt reactor in the town of Visaginas.

Butkevicius has said his government was studying whether energy independence could be achieved without nuclear generation and would make a decision in May. Last week he said he didn’t think nuclear energy was a priority for the country.

Hitachi Offer

“The reactor that Hitachi offered us is definitely not necessary or useful for Lithuania,” said Vesaite, a member of Butkevicius’s Social Democrat party who isn’t directly responsible for energy policy. She spoke on the radio at a time when the prime minister usually gives a weekly interview.

“We should refrain” from nuclear power in general, the minister said. “It’s not worth it, there are other sources of generation, renewables, and the one power link with Poland, which isn’t finished yet, can’t ensure reserve capacity.”

Butkevicius, who will meet Medvedev on the sidelines of a conference tomorrow in St. Petersburg, said Vesaite wasn’t acquainted with details of the power-generation options and today’s radio remarks were just her personal opinion, BNS said.

To contact the reporter on this story: Bryan Bradley in Vilnius at bbradley13@bloomberg.net

To contact the editor responsible for this story: Balazs Penz at bpenz@bloomberg.net


Monsanto vs. GMO Haters
LIMITED-TIME OFFER SUBSCRIBE NOW

(enter your email)
(enter up to 5 email addresses, separated by commas)

Max 250 characters

 
blog comments powered by Disqus