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Republic of Lithuania National Energy Strategy

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Republic of Lithuania National Energy Strategy INIS-mf-_]473J IC Consult ERM Energy COWIconsult (with Technical Assistance of EU-PHARE) and Lithuanian Energy Institute it Republic of Lithuania National Energy Strategy Volume II: Background Material for Strategy Development Final Report December 1993 VOL IC Consult ERM Energy COWIconsult (with Technical Assistance of EU-PHARE) and Lithuanian Energy Institute Republic of Lithuania National Energy Strategy Volume II: Background Material for Strategy Development Final Report December 1993 Introduction to Volume II The Final Report of the National Energy Strategy is laid out in two volumes. Volume I is a complete and self-explanatory description of the National Energy Strategy inclusive of all information necessary to understand the development and justification of the Strategy. Volume II presents supplementary Background Material collected and analysed during the course of the project. Volume II consists of two parts: PART A (Sources and Methods) and PART B (Special Subsector Issues). PART A contains seven chapters. The subject of Chapter 1 is to integrate the material of this volume into the analytical approach as a whole and to give an outline of the tools applied in the Strategy development. Reference data provided in Chapter 2 summarizes the information as to the past energy consumption and the future economic development. Chapter 3 compiles basic parameters and assumptions with regard to energy forms, costs, the economic development as laid down for use in the project. Chapter 4 discusses in detail the projection of energy demand. Chapter 5 draws up the Projects under consideration. Chapter 6 presents key results of energy scenario computations, and Chapter 7 provides energy scenario indicators and assessment information. PART B of this Volume II contains full reporcs regarding topics, which have only briefly been addressed in Volume I. CONTENTS PAGE A SOURCES AND METHODS 7 1. APPROACH 1 1.1 OVERVIEW 1 12 APPLIED TOOLS: ENERGY TOOLBOX 1 2. REFERENCE DATA 3 2.1 MACROECONOMIC SCENARIOS (WORLD BANK, ME) 3 12 ENERGY BALANCE AND ENERGY CONSUMPTION (1990-1992) 6 3. BASIC PARAMETERS AND ASSUMPTIONS 15 3.1 MACROECONOMIC SCENARIOS CONSIDERED WITHIN THE ENERGY STRATEGY 15 32 DEMOGRAPHIC DEVELOPMENT AND URBAN-RURAL SPLIT 24 33 COST/PRICE DEFINITIONS AND PROJECTIONS 29 3.4 DEFINITION OF ENERGY FORMS 36 3.5 EMISSION COEFFICIENTS 37 4. PROJECTION OF ENERGY DEMAND 43 4.1 CONCEPTUAL CONSIDERATIONS 43 42 CHOSEN APPROACH 43 5. PROJECTS 49 6. RESULTS OF ENERGY SCENARIO COMPUTATIONS 51 6.1 RESULT TABLES INFORMATION 51 62 RESULT TABLES FOR SELECTED ENERGY SCENARIOS 51 7. SCENARIO INDICATORS AND ASSESSMENT 71 B SPECIAL SUBSECTOR ISSUES 75 B.I ELECTRICITY SUBSECTOR: PROPOSALS FOR A TECHNICAL AUDIT 77 B2 LEGAL/INSTITUTIONAL ISSUES: ASSESSMENT OF THE LEGAL AND INSTITUTIONAL FRAMEWORK IN LITHUANIA 87 LIST OF FIGURES PAGE Figure 2.1.1 GDP Growth Scenarios (WB, ME) 5 Figure 22.1 Development of Final Energy Consumption by Energy Forms, 1990 to 1992 12 Figure 222 Development of Final Energy Consumption by End-use Sectors, 1990 to 1992 13 Figure 3.1.1 Macroeconomic Scenarios Used in the Strategy Study 17 LIST OF TABLES PAGE Table 22.1 Energy Balance 1990 8 Table 222 Energy Balance, Conversion Sector in Detail, 1990 9 Table 223 Energy Balance, End-use Sector in Detail, 1990 10 Table 22.4 Development of Final Energy Consumption by Sectors and Energy Forms, 1990 to 1992 11 Table 22.5 Large Industries, Energy Consumption 1990 14 Table 3.1.1 Sectoral Growth Rates and Composition of GDP - Moderate Reforms-Scenario 18 Table 3.12 Sectoral Growth Rates and Composition of GDP - Fast Reforms-Scenario 19 Table 3.13 Sectoral Growth Rates and Composition of GDP - Slow Reforms- Scenario 20 Table 3.1.4 Sub-sectoral Growth Rates and the Composition of Industrial Output - Moderate Reforms-Scenario 21 Table 3.1.5 Sub-sectoral Growth Rates and the Composition of Industrial Output - Fast Reforms-Scenario 22 Table 3.1.6 Sub-sectoral Growth Rates and the Composition of Industrial Output - Slow Reforms-Scenario 23 Table 32.1 Population Development and Urban/Rural Split 1970 to 2010 25 Table 322 Population by Administrative Districts, Lithuania, 1979 and 1989 26 Table 323 Population of Cities, Lithuania, 1979 and 1989 27 Table 32.4 Development of Population/Living Conditions, Lithuania, 1990 to 2015 28 Table 33.1 Exchange Rates for Selected Currencies, 1980 to 1993 30 LIST OF TABLES PAGE Table 332 Development of Crude Oil and Other Fuels Prices, 1990 to 2013 32 Table 333 Import and Export Price Projections by Energy Forms, 1990 to 2015 (Medium Projection) 34 Table 33.4 Domestic Energy Prices in Moderate Reforms-Scenario (USD/GJ) 36 Table 3.4.1 Energy Forms 36 Table 3.5.1 Emission Coefficients • Nitrogen Oxides (NOx) in kg/GJ Fuel Input 38 Table 3.5.2 Emission Coefficients - Sulphur Dioxide (SO2) in kg/GJ Fuel Input 39 Table 3.53 Emission Coefficients - Carbon Dioxide (CO2) in kg/GJ Fuel Input 40 Table 3.5.4 Emission Coefficients - Particulates (TSP) in kg/GJ Fuel Input 41 Table 4.2.1 Additional Conservation Effects and Total Intensity Reductions 47 Table 6.1a Results of Scenario 6A 52 Table 6.1b Results of Scenario 6A (first continuation) 53 Table 6.1c Results of Scenario 6A (second continuation) 54 Table 62a Results of Scenario 12 A 55 Table 62a Results of Scenario 12 A (first continuation) 56 Table 62b Results of Scenario 12A (second continuation) 57 Table 63a Results of Scenario IB 58 Table 63b Results of Scenario IB (first continuation) 59 Table 63c Results of Scenario IB (second continuation) 60 Table 6.4a Results of Scenario 5B 61 Table 6.4b Results of Scenario 5B (first continuation) 62 Table 6.4c Results of Scenario 5B (second continuation) 63 Table 65a Results of Scenario 9B 64 Table 6.5b Results of Scenario 9B (first continuation) 65 66 Table 65c Results of Scenario 9B (second continuation) 67 Table 6.6a Results of Scenario 1C 68 Table 6.6b Results of Scenario 1C (first continuation) 69 Table 6.6c Results of Scenario 1C (second continuation) LIST OF TABLES PAGE Table 7.1 Indicators for Slow Reforms-Scenarios (2A, 4A, 6A, 8A, 10A, 12A) 72 Table 12 Assessment for Fast Reforms-Scenarios (2A, 4A, 6A, 8A, 10A, 12A) 72 Table 13 Indicators for Fast Reforms-Scenarios (1C, 3C, 5C, 7C, 9C, 11C) 73 Table 7.4 Assessment for Fast Reforms-Scenarios (1C, 3C, 5C, 7C, 9C, 11C) 73 PART A SOURCES AND METHODS 1. APPROACH 1.1 OVERVIEW The aim of the Strategy study is to determine the measures needed for modernising the Lithuanian energy system. The measures identified are referred to as Projects. Project Profiles specify the capital and time requirements for the implementation of the Projects and their expected effects on energy system performance. Twenty-four energy scenarios are established, from which the Energy Strategy in terms of a set of appropriately scheduled Projects can be derived. Each energy scenario comprises a demand scenario providing projections of the sectoral demands for final energy and a supply scenario presenting the required capacity installation and utilization levels of the energy production and conversion sectors for meeting the projected demands. The projection of the energy demands is described in more detail in Chapter 4. Sectoral consumption and energy intensity figures are derived from energy balance and consumption figures presented in Chapter 2.2, demographic data used are assembled in Chapter 3.2. For each demand scenario, a supply scenario is built so that: • the resulting capacity installation and operation schedules meet the sectoral final demands; • the scenario as a whole reflects the specific characteristics of the defined case. 1.2 APPLIED TOOLS: ENERGY TOOLBOX Of the various software tools offered by (ERM Energy's) Energy Toolbox (ETB), the Disaggregated Demand Analysis System (DDAS) is applied to the task of creating the demand projections, and the Reference Energy System (RES) is used for balancing the supply required for meeting demands under the conditions of the scenarios. The DDAS allows input, modelling, and projection of demand data, disaggregated as needed for use in the Strategy Study. It provides a computer-based environment for the organization of all the items of data for editing, debugging and solving the large number of scenarios, as under consideration in the Strategy Study, for instance. The environment is intended to mirror the structure of energy use of a given economy and is implemented as a pictorial representation displayed on-screen. Standard syntax equations are formulated specifically for this application. 1C CONSULT - ERM ENERGY - COWI CONSULT LITHUANIAN ENERGY INSTITUTE The RES simulates future energy supply for each scenario, for the years selected, and also calculates the cost of energy supply. Results are the primary supply of fuels, their processing, power generation, distribution to end-users, etc. Like the DDAS, RES allows for a user-defined disaggregation of all system components, ie the energy forms and the technologies under consideration. By its integration with the DDAS through a database and comprehensive data management facilities, the RES can directly access th~ annual demands calculated for a selected year for a scenario. Input and output information can be prepared in both printed and graph form. Energy balances and costs reports can be generated by the Report Generator. IC CONSULT - ERM ENERGY - C0W1 CONSULT LITHUANIAN ENERGY INSTITUTE 2. REFERENCE DATA 2.1 MACROECONOMIC SCENARIOS (WORLD BANK, ME) Several economic scenarios have been developed by various institutions including the World Bank (WB) and the Lithuanian Ministry of Economics (ME). The common assumption of these scenarios consists in the flattening out of the economic slump experienced since the restitution of independence in 1990 during the years 1993 to 1994. The ensuing economic upturn varies from one scenario to the other as shown in Figure 2.1.1.
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