Transatlantic Energy Security From a Baltic Perspective

Years before Russia started its full-scale war against Ukraine, the Baltic states of Lithuania, Latvia, and Estonia, correctly assessing the Russian threat, implemented far-reaching reforms to end their energy dependence on Russia. Successful implementation of multiple infrastructural projects and energy market liberalization significantly improved Baltic energy security. It made the region a role model for the rest of Europe. Further energy security upgrades are planned in the coming months when the Baltic states will desynchronize their electricity grids from the Russia-controlled IPS/UPS electricity system in February 2025. While celebrating these noteworthy achievements, the Baltic states and their NATO allies should be aware of the potential increase in Russian gray zone activities that could be directed against further consolidation of the European energy security stronghold in the Baltics.  Baltic Energy Security Upgrades In terms of energy security, the Baltic states were an isolated energy island until 2014. Having no access to European electricity and gas networks and being heavily dependent on energy imports from Russia, they were exposed to Russia’s political blackmailing and interference in domestic politics. The game-changer was Lithuania’s decision to install an LNG terminal on its Baltic coast. Despite active pressure from Russia, Lithuania successfully implemented the project and at the same time carried out far-reaching reforms to liberalize its gas market, forcing Russia’s Gazprom out of the Lithuanian energy sector. Similar, albeit less principled, measures were also taken in Latvia and Estonia. While being quite an unusual project at a time when most of the European countries were still comfortable with fostering and even deepening their energy “partnerships” with Russia (Germany’s decision to install the Nord Stream 2 pipeline serves as the best example), the Lithuanian LNG terminal brought the full spectrum of positive effects from short-term gas price reductions to the long-term ability to serve regional and broader European energy security interests.  The Baltic states’ geo-economic shift in terms of energy supplies was remarkable. Having covered all its natural gas needs with imports from Russia back in 2013, Lithuania, followed by Latvia and Estonia, became the first European country to ban all Russian gas imports, including its LNG, in April 2022 as a reaction to the invasion of Ukraine. Other European countries, despite Russia’s brutal war against Ukraine, remain eager consumers of Russian gas and have even increased the import volumes of Russian LNG by 11% year over year in the first half of 2024.  The fully operational LNG infrastructure in the Lithuanian seaport Klaipėda and well-established partnerships with LNG suppliers, mostly from the US and Norway, enabled Lithuania’s, and the wider Baltic region’s, principled energy policy and their smooth transition from Russia to other gas suppliers. Having become one of the first European importers of US LNG in 2017, Lithuania’s LNG imports from the US peaked in 2022, making the US the leading LNG supplier for Lithuania and setting a clear sign that increased transatlantic cooperation was the right answer to Russia’s aggression and destabilization attempts. In the first six months of 2024, Lithuania’s LNG imports were almost equally split between the US and Norway as the two main suppliers.  In addition to the Lithuanian LNG terminal that symbolically holds the name “Independence,” further infrastructural upgrades in the Baltics followed, strengthening the region’s leading role in European energy security efforts even further. The recent completion of the Enhancement of Latvia-Lithuania interconnection project (ELLI) provided Lithuania with better access to the Inčukalns underground gas storage (UGS) in Latvia, which is unique in the region, serving the function of a crucial gas backup facility. The Baltic countries fill the storage in summer when gas prices are low to avoid gas shortages in winter when both gas consumption and its prices increase significantly. At the same time, the bidirectional ELLI pipeline allows increasing gas flows from the Lithuanian LNG terminal to Latvia and Estonia. The importance of the Gas Interconnection Poland–Lithuania (GIPL), which has been operational since May 2022, cannot be overstated. The bidirectional pipeline serves as the key element of the European North-South gas corridor connecting the Baltic region and Finland with Continental Europe. It further diversifies the Baltic countries’ gas import routes and opens new possibilities for exploiting Lithuania’s LNG terminal as an entry point for LNG to the European gas market.