Today in Brussels, the three Baltic power transmission system operators – Estonia’s AS Elering, Latvia’s AS Augstsprieguma Tīkls (AST) and Lithuania’s Litgrid AB – signed a grant agreement with the European Innovation and Networks Executive Agency (INEA), according to which 75% (EUR 323 million) co-financing will be assigned to phase one of the Baltic synchronisation project. The total cost in Latvia is EUR 77 million, including EUR 57.75 million of co-financing.

"The fact that the first phase of the project has received the maximum possible co-financing - 75% - shows that we are respected in Europe, that our applications have been prepared to a high standard and that this project is important not only for the Baltic region, but for the whole Europe as well. In addition, investing European co-finnacing in grid development will allow AST to avoid own investments in the future, which could affect the electricity transmission tariffs," says Arnis Staltmanis, Member of the Board of AST, expressing satisfaction with the signed grant agreement.

The total cost of phase one of the project in Baltics is EUR 430.2 million. The framework of the project includes the reconstruction of existing power transmission lines in Lithuania, Estonia and Latvia, construction of new lines, installation of autotransformers at Alytus substation in Lithuania, as well as upgrading and installation of power system inertia, frequency provision and system control equipment.

In Latvia, the first phase of the project includes the reconstruction of two existing Latvian-Estonian interconnections Valmiera - Tartu and Valmiera - Tsirgulina, with the estimated total cost of EUR 45 million and scheduled from 2020 to 2024, installation of one synchronous condensers (SC) in power transmission system of Latvia to ensure network inertia in synchronisation mode. The estimated cost is EUR 25 million and the Brocēni substation is currently considered as its preferred location.

The project also includes costs related to the installation of power system monitoring and control system both in the power transmission system and at the power plants of Latvia following model testing and validation in 2019.

The Baltic States have made a political decision to disconnect from the so-called BRELL power supply ring connecting Latvia, Lithuania and Estonia with Belarus and Russia by 2025 and to synchronise with the continental European electricity system to reduce dependence on Russia's infrastructure. Last June, the leaders of the European Commission, Latvia, Lithuania, Estonia and Poland signed a political roadmap on synchronisation.

It is planned to use the existing Lithuanian and Polish LitPol Link interconnection and additional undersea high voltage direct current cable between Lithuania and Poland, as well as synchronous condensers in all Baltic States.

The main benefits of synchronising the Baltic States with continental Europe and desynchronising from Russia and Belarus are more reliable cooperation with European electricity systems in accordance with uniform operational and management principles (the Network Code) and a higher number of electricity system services that are available in Europe (frequency adjustment, surplus trading, consumption load adjustment, etc.). The cross-border electricity trade in Europe is also expected to increase after the synchronisation of the Baltic states.