Energy, Gas, Legislation, Lithuania

"The terminal guarantees the country's energy security, but it is mostly sustained through greater heating cost by those who receive district heating. We believe this is unjust, everyone should pay for the sustenance of the terminal, which is a geopolitical and not economic project," said Vytautas Stasiunas, President of the Lithuanian District Heating Association.

In 2015, district heating consumers will pay more than EUR 40 million in fees for the terminal, the so called additional security supplement which is included in the natural gas transmission tariff, and complying with the obligation established by law to consume expensive gas provided by the terminal. District heating is generated using natural gas.

More than 24% of the expensive natural gas supplied by the terminal is consumed in Vilnius. Therefore residents of Vilnius are paying for the sustenance of the terminal more than people from other cities. It is estimated that in 2015 residents of Vilnius will pay EUR 10 million additionally for the gas bought from the terminal and the sustenance of the terminal.

Since 1 January 2015, heat supplying companies have been obligated by law to purchase and consume expensive gas provided via the terminal. In 2015, Vilnius has to purchase 65% of all gas from the LNG terminal. Moreover, between April and November 2015, LNG gas will account for 100% of all gas consumed in Vilnius.

The price of natural gas purchased from the LNG terminal is EUR 32.59 per MWh, whereas its price at the natural gas exchange GET Baltic is EUR 22 per MWh, while gas providing company Lietuvos Duju Tiekimas has publicly declared that in March 2015 it will sell natural gas for only EUR 18 per MWh.

The additional security component, EUR 2.15 per MWh, is added to all natural gas prices in Lithuania, regardless of who is a supplier of gas.