Enefit CEO Janis Bethers says the amount of snow in Scandinavia, one of the main exporters of electricity to Lithuania, saw less snowfall this year, consequently, hydroelectric power plants will generate less cheap electricity.
In his words, the few years of declining electricity prices in Lithuania have ended, and there are few signs that the downward tendency would continue in 2017-2018. However, Bethers did not give a specific figure of what the price increase could be, adding this could be determined by a number of factors.
"We have seen constant price decrease year to year. Our view is that most probably this price decrease is going to stop for several reasons. One of the reasons is that there is lack of water and snow in Scandinavia. (...) This snow is the source of water that will go to hydropwer reserves and approximately 60% of electricity is produced of hydropower in Scandinavia," he told a Vilnius news conference on Tuesday.
In his words, lack of snow and water could have a 3-5% influence upon the final electricity price. Furthermore, the growing gas prices may also have a negative effect upon prices.
"If we look at the local aspects then the other important thing is the gas price. The gas power plants in Latvia and Lithuania play a significant role. (...) We most probably see the increase in gas price," said the Enefit CEO.
Nevertheless, in his words, the 2018-2020 period will bring positive changes to the electricity price. For instance, the electricity balancing model should come into effect, under which companies would reduce their consumption levels in peak hours, which would pull down the electricity price. Furthermore, Finland should launch its new Olkiluoto Nuclear Power Plant, which will reduce electricity prices, and the start of the additional power link between Latvia and Estonia will reflect the price in both Lithuania and Latvia.
Eesti Energia, Enefit's operator, which supplies gas in Estonia, while Enefit intends to soon start supplying gas to Poland and Latvia, furthermore, does not rule out the possibility of supplying them to Lithuania. The company's expansion manager Edita Brazyte maintains the decision would be made after expiry of compensation of Gazprom gas prices for Lietuvos Duju Tiekimas (Lithanian Gas Supply), which does not allow competition from other players on the market.
Last year, Enefit saw its last year saw its revenue climb 3.1% to 23 mln euros, while the profit widened by a factor of nearly 10 from 260,000 euros to 2.2 mln euros, including 1.45 mln euros in financial operations profit.
