FOI-R--3990--SE_reducerad

FOI-R--3990--SE
3.10 Russia’s Influence on Energy Policy
For primarily historical reasons, Estonia, Latvia and Lithuania are still linked to
Russia by common electricity grids and gas pipelines. Most of the current
infrastructure was built during the Soviet era, when the network was designed as
a single whole with Russia at its core. The situation has changed little in the two
decades since. Russia remains the sole exporter of gas and the dominant exporter
of oil to the Baltic states. Unlike any other EU country (with the partial exception
of Finland), the Baltic states are largely disconnected from the rest of Europe.
They have been labelled “energy islands” by the European Commission.
Perceptions gained from past experience of Russia’s power politics 157 and
decades of repression under the Soviet Union make the Baltic states sceptical
about doing business with Russia. They prefer to move closer to demonstrably
more reliable EU member states. This definitively shapes the policies and
economic approaches of the Baltic states to their common neighbour.
When discussing the role of Russia in the Estonian energy sector, it is important
to note the comparative aspect. Compared to its Baltic neighbours, Estonia is
much less dependent on Russian energy and thus less vulnerable to political
exploitation. This is mainly because Estonia generates most of its energy
domestically – 70 per cent from local oil shale – while imports from Russia
account for more than half of consumption in Latvia and Lithuania. In Estonia,
fossil-fuel imports from Russia represented 18.1 per cent of the total energy
supply in 2013 (9.5 per cent oil and 8.6 per cent gas), while renewable sources
accounted for 14.6 per cent of total energy supply. Estonia is also connected to
Finland through the Estlink 1 (350 MW capacity) and Estlink 2 (650MW). The
latter began operations in 2014.
Nevertheless, there are still some aspects of energy dependency about which
Estonia, as well as the Baltic states in general and the European Union, are
rightly concerned. The Baltic states are fully dependent on Russia for natural gas,
and almost 100 per cent of the oil consumed in the three countries is imported
from Russia. Furthermore, the companies that sell and distribute gas in the Baltic
states are owned, at least to some extent, by Gazprom, which in turn is controlled
by the Russian state. Moreover, all the Baltic states import Russian electricity,
albeit in varying proportions, and are synchronized with the Russian electricity
grid as opposed to that of the rest of the EU.
157 Natural Gas Europe (2013): Reconciling “Crazy Russians” vs. “Crazy Europeans”, December,
available at: http://www.naturalgaseurope.com/south-stream-alan-riley-russia-
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