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Lithuania 2021 Energy Policy Review INTERNATIONAL ENERGY AGENCY

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Lithuania 2021 Energy Policy Review INTERNATIONAL ENERGY AGENCY Lithuania 2021 Energy Policy Review INTERNATIONAL ENERGY AGENCY The IEA examines the IEA member IEA association full spectrum countries: countries: of energy issues including oil, gas and Australia Brazil coal supply and Austria China demand, renewable Belgium India energy technologies, Canada Indonesia electricity markets, Czech Republic Morocco energy efficiency, Denmark Singapore access to energy, Estonia South Africa demand side Finland Thailand management and France much more. Through Germany its work, the IEA Greece advocates policies Hungary that will enhance the reliability, affordability Ireland and sustainability of Italy energy in its Japan 30 member countries, Korea 8 association Luxembourg countries and beyond. Mexico Netherlands New Zealand Norway Poland Portugal Please note that this Slovak Republic publication is subject to Spain specific restrictions that limit Sweden its use and distribution. The terms and conditions are Switzerland available online at Turkey www.iea.org/t&c/ United Kingdom United States This publication and any The European map included herein are without prejudice to the Commission also status of or sovereignty over participates in the any territory, to the work of the IEA delimitation of international frontiers and boundaries and to the name of any territory, city or area. Source: IEA. All rights reserved. International Energy Agency Website: www.iea.org Foreword The International Energy Agency (IEA) has conducted in-depth peer reviews of its member countries’ energy policies since 1976. This process not only supports energy policy development, but also encourages the exchange of and learning from international best practices and experiences. By seeing what has worked – or not – in the “real world,” these reviews help to identify policies that deliver concrete results. Since 2017, the IEA has modernised the reviews by focusing on the key challenges in today’s rapidly changing FOREWORD energy markets. The IEA in-depth review of the energy policies of Lithuania was carried out in the framework of Lithuania’s request to become a member of the IEA. I welcome the broad alignment of the country’s energy policies with the shared goals of the IEA. Our review provides a range of recommendations to help the government design its future energy and climate policies, in the light of the EU-wide efforts to shift toward climate neutrality and regional ambitions to strengthen energy security. First, this review offers policy advice on how to seize the opportunity to use EU funds for economic recovery from the Covid-19 pandemic to support clean energy transitions. Electrification will determine the speed of the region’s clean energy transition, and our recommendations also emphasise how Lithuania can make modern bioenergy and electricity a pillar for the further decarbonisation of transport, industry and buildings while enhancing resilience and security. Second, Lithuania is continuously emphasising the importance of energy security in its energy strategy. Amid rising geopolitical tensions in the Baltic region, I commend the government for boosting regional gas security with the Klaipeda LNG terminal and for placing electricity security at the heart of its regional efforts. Security is more important than ever, as threats from extreme weather events or cyber-attacks place ever greater stress on the power system. It is my hope that this in-depth review will help guide Lithuania in its admirable efforts to accelerate the energy transition toward its ambitious 2050 targets. The IEA is committed to help the Lithuanian government achieve its energy policy goals of providing affordable, secure and clean energy to its people as they adapt to a fast-changing international energy landscape. Dr Fatih Birol Executive Director International Energy Agency reserved. rights 3 All IEA. ENERGY INSIGHTS Foreword ..............................................................................................................................3 1. Executive summary .....................................................................................................11 2. General energy policy .................................................................................................15 Country overview ...............................................................................................................15 Supply and demand ...........................................................................................................17 Energy policy institutions ...................................................................................................21 Assessment .......................................................................................................................27 Recommendations .............................................................................................................29 TABLE OF CONTENTS OF TABLE ENERGY SYSTEM TRANSFORMATION 3. Energy and climate change ........................................................................................31 Overview ............................................................................................................................31 Emissions trends ...............................................................................................................32 Climate policies and targets ..............................................................................................36 Assessment .......................................................................................................................43 Recommendations .............................................................................................................45 4. Energy efficiency .........................................................................................................47 Overview ............................................................................................................................47 The role of energy efficiency .............................................................................................48 Energy intensity .................................................................................................................49 Energy efficiency governance ...........................................................................................51 Energy efficiency targets and policies ...............................................................................51 Policies and measures by sector .......................................................................................54 Assessment .......................................................................................................................63 Recommendations .............................................................................................................67 5. Renewable energy .......................................................................................................71 Overview ............................................................................................................................71 Renewable energy in total final electricity consumption ...................................................72 Assessment .......................................................................................................................80 Recommendations .............................................................................................................83 6. Energy research, development and innovation .......................................................85 Overview ............................................................................................................................85 IEA framework for energy innovation policies ...................................................................86 reserved. rights 5 All IEA. TABLE OF CONTENTS Energy priorities linked to innovation policy ......................................................................87 Lithuania’s energy innovation ecosystem .........................................................................88 Resource push ..................................................................................................................89 Knowledge management ...................................................................................................92 Market pull .........................................................................................................................93 Socio-political support .......................................................................................................95 Assessment .......................................................................................................................96 Recommendations .............................................................................................................99 ENERGY SECURITY 7. Electricity................................................................................................................... 101 Overview ......................................................................................................................... 101 Electricity supply ............................................................................................................. 102 Electricity demand .......................................................................................................... 103 Electricity generation capacity, imports and exports .....................................................
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