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The road to energy independence requires bold decisions

November 12, 2021
Vēja enerģijas asociācija

Juris Antužs, Member of the Council of the Latvian Wind Energy Association

We are currently on the brink of an energy crisis, with energy prices rising sharply and it’s availability declining. This clearly shows that Latvia must finally start to address in practice how to achieve energy independence and abandon fossil fuel energy production, where price fluctuations are determined not only by climatic but also by political conditions. Yes, it is a decades-long energy model in which much has been invested, but it is already clear that it is an incompatible model with the future vision of the world, as well as Latvia. Therefore, the question is, are we, as a country, ready to take bold decisions so that such crises do not affect us even more in the coming years?

Although natural gas prices are projected to fall next spring, there are still a number of external factors that could affect this, from the need for natural gas in countries with increased solvency to concerns about whether we will be able to buy the natural gas we need. The price of natural gas also depends on meteorological conditions. It is known that hot and dry summers have contributed to water depletion, making energy production more expensive. Furthermore, it is no secret that gas is also an instrument of political strategy, and the constant rise in the price of carbon allowances is only increasing the cost of producing fossil fuels.

This shows that energy independence based on a natural gas resource is just an illusion, because we have very little influence over this. Yes, renewable resources are also difficult to predict – the wind does not always blow and the sun doesn’t always shine. However, they are resources which are accessible to all, and are influenced by a much smaller set of factors that can be managed wisely through smart solutions. Many countries have already proved that it works, but it has certainly not happened overnight. It is therefore important to start work on the transformation of the energy sector as soon as possible. The first step would be to be clear about it is necessary for Latvia, not just for Europe.

At the same time, we must not forget that we are also bound by the European Union’s goals of reaching climate neutrality. One of the cornerstones on the way to this is renewable energy production. Experience to date has shown that, despite efforts, Latvia has not been able to successfully develop renewable energy sources such as solar or wind. Entrepreneurs’ efforts to develop the industry have been met with partial public opposition to the creation of modern and efficient wind or solar farms.

Strategic commitment is needed

Denmark’s example shows that targeted government decisions can open the door and allow for a rapid boom in green energy, which is both, a way to the country’s energy independence and a more competitive business environment, as well as climate neutrality and an overall quality of life. At present, about 50% of the electricity consumed in Denmark is generated by wind. The figure is projected to be over 70% over the next ten years, but the Danish government hopes to switch completely to renewable energy over the next 30 years. This clearly shows that the country can rapidly change its course of development in the green direction. It all starts with a change in thinking and the courage to take radical steps – not only setting new priorities, but also fulfilling them.

We often look to Scandinavia as a good example. I believe that it is high time to delve into Denmark’s experience towards the introduction of renewable energy and the development of energy independence in order to take similar steps here. The country was reviewing its development priorities as early as the 1970s, when it experienced a major energy crisis, which gave it the impetus it needed to make bold decisions and develop green energy. The question is how many crises we will have to go through in order to get real change, and return to ‘business as usual’ once the peak of the crisis is over. What is happening in the energy sector in Latvia and the whole region at the moment is a clear signal that it is high time to learn important lessons.

Opportunity for municipalities to increase their competitiveness

We should take a look at the positive example set by Denmark in the most modern district of the capital, Nordhagen. This is an area where the use of green energy is especially taken into consideration. There, scientists and entrepreneurs are looking for ways to make life more sustainable, to build energy-efficient buildings, to integrate electric transport into everyday life. Of course, solar panels and wind generators play a huge role there. Looking at this example, one wants to believe that there are also cities and municipalities in Latvia that could take the lead in developing green energy and thus increase their competitiveness, have a positive impact on electricity prices for their citizens and develop the economy as a whole.

Not only Denmark, but also our closest neighbors – Lithuania and Estonia – are actively working to attract serious investment in the construction of wind farms. Latvia, on the other hand, has not made progress on this issue in the last ten years. At present, the installed capacity of wind farms in Latvia is close to 80 MW and has not changed since 2012. In Estonia, the current wind energy capacity is 309 MW. There are also several new wind farms under construction – Raunistal wind farm with a capacity of 20 MW and Purtse wind farm with a capacity of 18-20 MV will start operating in 2023, Sopi wind farm with a capacity of 160 MW – in 2024. In Lithuania, on the other hand, the current capacity is 540 MW, projects have already been started in more than 10 municipalities with a total capacity of 800 MW, and in the next 3-4 years six wind farms with a total capacity of another 308 MW will be created.

It is clear that renewable energy projects, such as the construction of wind farms, will always provoke a wide-ranging public debate on their location and various practical aspects. Probably, it is the fear of a heated discussion that deters our decision-makers from a more active use of renewable energy, as this topic has always had a strong populist baggage in Latvia. As a result, our state and local governments are choosing a comfort zone approach – to create immediate benefits without radical change and a commitment to be pioneers who drive new solutions with greater long-term benefits.

Latvia clearly lacks well-defined priorities in energy development and integrated cooperation in their implementation. The Danish experience has also shown that the sustainable development of green energy requires the three-legged principle, where strategic cooperation is put into practice by close cooperation between the local community and the municipality, investors and the state. As in life, three support points provide the most stable construction. Thus, even in this case, if each party purposefully moves towards the jointly set goal, then they support each other and, even if turbulence occurs at some point, the progress does not stop.

In our society, however, there are still divisions in beliefs and desires, state representatives lack courage and understanding, and investors, seeing all of this, lose motivation. Nor has the regulatory framework so far been favorable for investment, even though everyone would benefit from renewable energy, and this would be an investment in the quality of life of future generations.

I believe that the key word for progress towards a green course is ‘courage’ – the courage to make strategic and ambitious decisions. As the Danish experience shows, this is the main turning point in making the future today. I would urge the country not to be afraid to set higher goals. Why deal with energy independence when we can have the status of energy exporter? Ambition drives growth, and without bold decisions we can become stuck in yesterday.