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Policy Brief / Gas

Andris Piebalgs

The Baltic Litmus Test for Gas

Author(s): PIEBALGS Andris

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ABSTRACT

  • Much has been written and commented, in recent years, about the Baltic States and their delicate position – both geographically and politically speaking – concerning security of gas supply and energy independence from Russia.
  • While it’s no secret that the region has for a long time been quasitotally dependent from Gazprom imports, the profound, sometimes inevitable reasons of such vulnerability are not evident. At the same time – and consequently - the implications and ‘side effects’ of some energy policy and regulatory choices taken in this region are not the same as in any other country in Europe.
  • If we do not understand this, it becomes very difficult to see why the decision to open an LNG terminal in this region (Klaipeda) is welcome as ‘a symbol of energy independence’; and it becomes even harder to accept that the sudden, unfair price increase to gas customers by the incumbent company is publicly justified as the answer to the ‘inadequate’ choices - legitimately taken - by a country’s government.
  • As the title suggests, since they joined the Union in 2004, the Baltic countries have been the theatre of a delicate test for EU-Russia relations – which we might consider as still ongoing.
  • Since then, Lithuania, Latvia and Estonia have undergone a resolute path towards liberalization and diversification of energy sources – which will eventually lead these countries to becoming a single entryexit zone in 2020. But the road has been long and rocky.
  • That’s what this work by former Commissioner Andris Piebalgs is about, seen with the eyes of an expert and at the same time a ‘local’belonging to the region (Andris Piebalgs is from and has lived most of his life in Latvia).
  • This paper is not really a Policy Brief strictu sensu, but rather a photography: by reading it, the reader is not told any ‘pre-packaged’ truth but, on the contrary, he/she is guided through the recent history of the Baltic states and given the instruments to find out – by himself – the ‘why’ and ‘how’ of the delicate gas policy choices made by the Baltic countries.