This assessment was made by experts during the discussion at the European Bank for Reconstruction and Development (EBRD) business forum in Riga.
According to the Latvian portal bb.lv, the participants emphasized that the Baltic States should be considered as a single market. They need a common vision of what facilities and in what volumes should be built to avoid imbalance between energy production and consumption.
The industry representatives drew attention to another problem that has become particularly noticeable in recent years. Due to the rapid development of solar energy, in some hours its cost drops to almost zero.
Due to low prices, the payback period of projects is falling
It is important to realize that low prices are not always good news for the industry. If there is no one to buy the electricity produced, the payback on new projects becomes more difficult.
That’s why experts say the key area of focus is energy storage systems (BESS), which allow electricity generated by solar and wind power plants to be stored and used when demand increases.
Another solution could be to attract large data centers to the region. Such facilities consume a lot of electricity and can become an important source of demand for manufacturers.
Experts believe that the appearance of at least one large international data center in the Baltic States could stimulate further investments in the region.
Electrification of transportation was named as another driver of consumption growth. Although electric vehicles alone have virtually no impact on the energy system, the mass transition to electric transportation can significantly increase demand for electricity in the future.
Representatives of investment funds and energy companies said that banks continue to actively lend to renewable energy projects. Moreover, investors remain interested in the region even against the backdrop of ongoing geopolitical tensions.
