Lithuania’s energy sector is transitioning rapidly as the country moves away from reliance on imported energy, mostly gas, and expands its renewable energy production capacity. With a focus on onshore and offshore wind, solar, and bioenergy, Lithuania aims to become energy independent and reduce its carbon footprint. The government’s strategic investments in renewable energy and grid modernization, is backed by European Union (EU) support.
Energy market in Lithuania
Key opportunities for Canadian energy companies in Lithuania
- Renewable energy projects: Lithuania’s commitment to increasing its renewable energy capacity presents opportunities for Canadian firms specializing in wind, solar, hydrogen and other technologies, project development (including investment), and infrastructure. The National Energy Independence Strategy is aiming for 100% climate-neutral energy and a transition to an electricity-based economy by 2050. The plan includes developing 10 GW of onshore wind, 4.5 GW of offshore wind, and 9 GW of solar power, with estimated investments of EUR 49-79 billion. As renewable energy production capacity grows, Lithuania is developing energy storage capacities and is looking for new technologies.
- Smart grid and energy efficiency solutions: The modernization of Lithuania’s energy grid and the push for energy efficiency create a demand for companies providing advanced grid management and smart metering systems, including storage management. By 2030, Lithuania wants to reduce its electricity imports by half and produce 70% of its electricity needs domestically. It plans to complete its synchronization with the continental European power system by early 2025.
- Hydrogen energy development: Lithuania is taking steps to position itself as a leader in hydrogen energy. The Ministry of Energy has adopted the country’s first hydrogen development guidelines for 2024-2050. These guidelines outline strategic directions for integrating hydrogen technologies across industry, transport, and energy production. Key initiatives include:
Industry highlights
3.5% contribution to Lithuania’s GDP in 2023
27,178 people are employed in the Lithuanian energy sector
31.9 % share of renewable energy in gross final energy consumption in Lithuania in 2023
27% of the sources of energy in Lithuania (2023) are from biofuels and waste to energy
140,000 new jobs to be created by 2050 in the energy transformation sector, with up to 11% of the country's GDP generated
23,5MW of renewable energy to be developed by 2025, with an estimated investment of EUR 49-79 billion
- Development of a hydrogen network: Lithuania's natural gas transmission system operator, Amber Grid, is preparing a ten-year plan that includes creating a hydrogen network and adapting the existing gas transmission infrastructure for hydrogen use.
- Regional collaboration: Amber Grid has also signed a memorandum of understanding with eight other natural gas transmission system operators. This partnership aims to coordinate the development of hydrogen infrastructure and promote a robust hydrogen market in the Baltic Sea region.
Notable challenges for Canadian energy companies in Lithuania
- Regulatory compliance: Navigating EU and local regulations regarding carbon emissions, energy production standards, and renewable energy targets may pose challenges for Canadian companies.
- Dependence on EU funding: Many energy projects rely on EU grants and incentives, which often prioritize EU suppliers, potentially limiting opportunities for non-EU companies.
- Market structure: The energy sector is characterized by a very limited number of players in generation and infrastructure, with state monopolies dominating the market.
Lithuania business landscape
Lithuania’s energy sector is supported by a comprehensive national strategy aimed at achieving energy independence and carbon neutrality by 2050. The country prioritizes the expansion of renewable energy sources, such as wind and solar power, and the modernization of energy infrastructure, including the development of smart grids. Key ongoing projects include large-scale wind farms in the Baltic Sea, solar park developments, hydrogen feasibility assessment and the implementation of energy efficiency measures in buildings. The Lithuanian government offers support and incentives for companies investing in these areas, with a particular focus on initiatives that align with EU and national sustainability goals.
Summary
Lithuania is an attractive market for energy companies, particularly those involved in LNG supply, renewable energy, grid technologies, and bioenergy solutions. With strong government commitment, EU support, and a strategic focus on energy independence and renewable energy, Lithuania’s energy sector offers potential opportunities for Canadian companies seeking to expand in the European market.
For more information on the energy opportunities in the Lithuanian market, please contact Egle Jurkeviciene (egle.jurkeviciene@international.gc.ca).