Baltic States – CIS, Belarus, Energy, Energy Market, Estonia, Latvia, Russia

Trade on the Latvian-Russian border will begin on the first hour of November 5. The transmission capacity allocated to the border is almost twice less than was allocated for the import of electricity from third countries to the Belarusian-Lithuanian border so far, Elering said.

Elering CEO Taavi Veskimagi said that, in addition to ending electricity trade with Russia, it is important for Estonia to establish a network fee for electricity from third countries in the spring of 2021 in order to reduce the unequal competitive situation.

An agreement to open the Russian-Latvian border for Russian electricity imports was signed by the Baltic TSOs in September this year. In October, the Estonian and Latvian regulators approved the submitted methodology for calculating transmission capacities. Commercial electricity flows will move via the Russian-Latvian border until the synchronization of the electricity systems of the Baltic states with the frequency band of the continental European electricity system by the end of 2025.

After the complete cessation of trade with Russia, the physical flow of electricity from Russia will also cease completely. Until then, certificates will prove that the electricity coming from the Latvian border to the Baltics does not come from Belarus.

According to the state energy company Eesti Energia, the closure of the Lithuanian-Belarusian electricity trade is an important event in the Baltic electricity market, the occurrence of which was known long in advance.

"Lithuania's decision is the right step towards a fairer market organization in the Baltics, which has so far been accessed on an unequal basis by electricity from third countries, whose production has not paid the environmental fees that apply in the EU. This situation has put EU electricity producers in an unequal market position and discourages investment in new renewable generation capacity," the company said.

Eesti Energia considers that those responsible for market organization must ensure that the actual volume of electricity trade does not exceed the maximum volume of transmission capacity between Russia and Latvia, which is 320 megawatts. "Otherwise, Estonian TSO Elering must apply to the NordPool power exchange to open the Estonian-Russian border for electricity trade," the company said.