Highlights

It is estimated that in 2015 the share of Renewable Energy Sources (RES) in the final energy consumption in Lithuania amounted to 25 percent, with biomass (wood and wood wastes) being the largest contributor. Lithuania meets the National Indicative Target of use of biofuels in transport through consumption of biofuels sourced from domestic production and from imports, mainly from the European Union. Rapeseed oil, the basic feedstock for biodiesel production, is produced in Lithuania.

Lithuania is now reliant on energy-generating raw materials that are imported from Russia but is actively developing renewable energy sources (RES) from biomass, wind and geothermal sources to gain energy independence again. In December 2009 Lithuania decommissioned the Ignalina Nuclear Power Plant which was the condition for EU accession as that facility employed the same nuclear technology as the Chernobyl facility. That facility previously satisfied 70 percent of the country's electricity demand.

Mandatory EU targets for renewable energy

In the National Energy Strategy (NES), the goal concerning renewable energy is in line with EU Directive 2009/28/EC. Lithuania should achieve by 2020 the mandated target of energy from renewable energy sources (RES) of 23 percent of gross energy consumption. In 2014 the share of RES in the final energy consumption amounted to 23.9 percent, with biomass (wood and wood wastes) being the largest contributor. It is estimated that in 2015 the share of RES in the gross energy consumption reached 25 percent. According to the NES, Lithuania holds huge potential of wind and hydro energy.

For 2016 the National Indicative Target (NIT) for use of biofuels in transport for Lithuania was set at 8.0 percent. NIT will grow up to 9.0 percent in 2017and to 10.0 percent in 2018. Lithuania meets the NIT through consumption of biofuels sourced from domestic production and from imports, mainly from the European Union. Rapeseed oil, the basic feedstock for biodiesel production, is produced in Lithuania. The basic raw material for bioethanol production is rye.

Biofuels

In Lithuania annual fuel consumption amounts to 200-250,000 MT of gasoline and 1.0 to 1.2 million MT of diesel per year. Lithuania produces two types of biofuel: biodiesel and bioethanol. The main feed stocks for biodiesel and bioethanol production are rape seed and rye. In Lithuania there are two biodiesel plants with capacity of 100,000 MT and 30,000 MT. It is estimated that in 2015 production of biodiesel amounted to 70,000 MT, 9 percent more over the previous year. Annual consumption of biodiesel in 2015 is estimated at 64,000 MT. The remaining amount of biodiesel is exported.

In 2015 annual production of bioethanol is estimated at 12,000 MT. In 2014 one of two plants producing bioethanol in Lithuania went bankrupt. In 2015 total bioethanol consumption is estimated at 11,000 MT.

Biofuel production in Lithuania started in 2002 and has expanded continuously since then. The share of biofuel as a percentage of total fuel consumption has been increasing as well, starting in 2005 at less than 0.5 percent to reach over 6 percent by 2015.

A reduction of prices for regular fuels in 2014 made biofuels less competitive. In addition there is still only a small number of bio-fuel using vehicles in the country. The harsh winter conditions and very low temperatures in Lithuania make use of high ethanol blends dangerous to car engines. A third reason is market limitations. Lithuanian blending companies can purchase bio-components from other EU producers who offer more competitive prices. Therefore, local producers are finding it a challenge to sell their higher cost bio-fuels.

Policy

Lithuania, as a member of the European Union, has implemented EU law on biofuels with a number of regulations. The basic requirements are two EU directives: Renewable Energy Directive (RED) (2009/28/EC) and Fuel Quality Directive (2009/30/EC).

RED obliges Member States to achieve a general target of 20 percent renewables in all energy used by 2020 and a sub-target of 10 percent renewables in the transport sector. Fuel suppliers are also required to reduce the greenhouse gas intensity of the EU fuel mix by 6 percent by 2020 in comparison to 2010. According to the new regulations, biofuels produced from wastes and non-food products will get bonus on the basis of sustainable development.