Baltic Ring

Baltic Ring Study - Executive Summary
(Doc DK-98/60)

The Baltic Ring Report – conclusions from the work towards a common Baltic electricity market

• An effective and reliable energy supply is an important condition for economic growth and environmentally sustainable development. The European Union has given priority to the development of a common Baltic electricity market as one of the major Transeuropean Networks.
  
  
• This Baltic Ring report is the result of a co-operation between 18 power companies and utility organisations. The conclusions of the study that has been going on for 2 years, were presented in Riga on January 22.
  
  
• The project group has collected extensive data on the plans of production, transmission and other important energy issues concerning the countries involved. Based on this, an analysis describing the benefits of energy integration in the Baltic Region has been made.
  

General findings

• The Baltic Ring report identifies many advantages of a common electricity market. Higher stability and possibilities of reducing emissions through common environmental standards create extensive benefits for the region as a whole. In economic terms, a common market can lead to lower running costs and reduced investment needs.
  
  
• Before these possibilities can be fully utilised, however, a number of changes are needed. To avoid "environmental dumping" and give all players equal conditions on the market, environmental and trading rules need to be harmonised. The integration should be driven by and market forces and socio-economic aspects and not solely by an increased electricity demand.
  
  
• The environmental aspects need to be developed further through Activities Implemented Jointly. This would take the establishment of a legal and financial framework which allows for environmental investments, such as the renewal of power plants in the region.
  
  
• Combined Heat and Power plants are especially suitable for combining environmental sustainability with an effective and reliable energy supply.
  

Recommendations

• Further co-operation between the partners involved, in the form of the Baltic Ring Electricity Co-operation (BALTREL). Launch a study on the possibilities of Activities Implemented Jointly to reduce emissions of CO2, SO2 and NOx in the region.
• Establish an overhead connection between the Western/Central European networks with those of Russia, Belarus and the Baltic states to serve as a supply opportunity in both directions and promote the electricity market.
• Initiate rehabilitation of Combined Heat and Power (CHP) plant 2 in Riga and construction of new CHP capacity in Kaliningrad.

Further information will be available on Internet, www.balticring.com