Lithuanian parliament endorses new LNG terminal financing model

Klaipėda LNG terminal
DELFI (V.Spurytės nuotr.)

In fact, experts say heating prices will go up under the new model as well, only not in Vilnius, which would have experienced the biggest hikes, had the old model stayed in place, but in smaller municipalities and only very slightly.

Mantas Dubauskas, an adviser to the energy minister, have told that “to ensure gas supply, the infrastructure has to be maintained. This maintenance is costly. Under the old scheme, if consumers had not used enough gas, they would not have paid enough to ensure supply security. According to the new model, the tax would be counted by expectation of maximum gas demand in one day.”

Prime Minister Algirdas Butkevičius said that “the new model was needed because gas demand in Lithuania is falling drastically and gas from the LNG terminal is still more expensive than what Gazprom offers.”

The adopted amendments will have the government establish a minimum quantity of gas required to ensure the operations of the LNG terminal in Klaipėda.

Under the law, energy producers have to buy the necessary LNG quantity from the designated supplier or a part of this quantity for a price projected and confirmed by Lithuania’s National Commission for Energy Control and Prices (VKEKK).

If, taking into account the forecasts of natural gas consumption by energy producers or actual natural gas consumption, it is impossible to sell some of the necessary quantity of the LNG terminal’s gas to energy producers, then the designated supplier must realize the necessary LNG amount on Lithuania’s natural gas market or global LNG market in the most cost-effective manner, in accordance with the principles of equality, non-discrimination, transparency, lowest cost, and smallest negative impact on natural gas prices to consumers.

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